Retired by 50: What it really takes

There were some bumps along the way. His wife didn't share his sense of mission, and they parted ways. He accepted a job at Sun Microsystems and moved back to California, living in his van in the company's parking lot for six months while he continued making payments on the Colorado house.

Eventually the home sold, and Ecks moved into the first of a series of shared apartments and rented rooms. In the notoriously high-cost Silicon Valley, he never paid more than $600 a month for shelter. When a friend totaled his van, he paid cash for a used Geo Metro to replace it. He ate out infrequently, cooked cheap meals at home and shopped for clothes and household goods at thrift stores.

The Sun Microsystems job paid well and had benefits, although Ecks never cracked the $100,000 annual pay mark. Still, he saved 50% of his gross income while still pursuing his passions, including learning to sail and traveling. He visited Mexico and Guatemala on a Green Tortoise bus and drove to Alaska, among other destinations.

He wanted more meaning in his work, though, so in 1999 he took a computer job with Greenpeace at the environmental organization's world headquarters in Amsterdam, Netherlands. Although his pay was less than one-third of what he'd been making at Sun, his cost of living was lower as well, and he still managed to save 25% of his income.

After a year or so, he was ready to come home. He convinced Greenpeace to let him work half time in San Francisco. He then bought the "world's smallest condo" -- a 307-square-foot space, about the size of a decent hotel room -- in downtown San Francisco shortly after Sept. 11, 2001. He paid the $127,250 purchase price with a check.

By the end of that year, he was ready to say goodbye to paid work. He told Greenpeace to stop paying him even though he continued working four hours a day as a volunteer. He now had the ability to take off when he wanted, which he soon did by sailing to Mexico with a friend.

He'd also met a woman who shared his passion for simple living and financial independence. Ann Haebig, now 38, said she's "always been frugal"

"Even in college I had in mind the idea of saving 'enough' and eventually quitting," said Haebig, who works as a database architect. "I didn't know how to make that goal real in any concrete way until I found 'Your Money or Your Life' in 1999 or 2000. I started charting my progress in earnest then."

Setting sail

Eventually, Ecks sold the condo for $235,000, and the couple rented a house for a while before buying an old houseboat for $3,100. They had it towed to a marina in south San Francisco where Ecks could also moor his 30-year-old, 27-foot sailboat. Berth rent and a live-aboard fee set the couple back $600 a month.

Ecks figures his total monthly expenses run about $1,500, which is actually less than his investments earn. Ann works half time at CompuMentor and expects to be retired entirely within seven years.

Interestingly, Ann's passion for her goal of early retirement isn't as strong since she stepped down from full-time work to part-time employment a few years ago.

"I used to be a dot-commer working too many hours at a job I just didn't care about. Now I'm working half-time at a nonprofit and still saving money, while spending my freed-up time on projects I really care about," Ann said. "If I have to keep working longer because my salary's decreased, that's OK with me. The journey's pleasant enough now that I'm not racing to save that magic number of dollars like I once was."

Ecks is concerned enough about the eroding power of inflation that he keeps half of his portfolio in stock-market investments (the other half is in Treasury bonds). But his experience, and that of many others who have embraced simple living, is that expenses actually go down over time as they get better at trimming costs.

In any case, Ecks said, the couple feels wealthy where it counts: in time and freedom.

"It's not what you have," he said. "It's how little you need."

In my next column, I'll introduce you to three more couples who have taken somewhat different paths to early retirement. In the meantime, here's what you can take away from these two stories:

• What matters more than what you make is what you save (although a bigger income and rising home equity can get you to your goal sooner).

• The decisions you make on the big expenses in your life -- where you live, what you drive, how much energy you burn -- have a profound impact on how much you can save.

• That said, no expense is too small to review if your goal is to get out of work early. Trimming expenses not only allows you to save more, but means you can live on less in retirement, thus speeding you to your goal.

Liz Pulliam Weston's latest book, "Easy Money: How to Simplify Your Finances and Get What You Want Out of Life," is now available. Columns by Weston, the Web's most-read personal-finance writer and winner of the 2007 Clarion Award for online journalism, appear every Monday and Thursday, exclusively on MSN Money. She also answers reader questions on the Your Money message board.

Published Sept. 13, 2007

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