The first thing I realized when I started working with
TCS, way back in 2005 was that I inherently dislike Work of any sort. There is no greater pleasure for me than sitting back an doing absolutely nothing all day. From the very first day, I started counting down to the time I can retire and laze around all day, which, I believe is my natural state.
While I always knew I wanted to retire early, I had no clue on when would be the right time when I can do that with absolutely no
compunctions about my future. Now, fortunately for me, I have been placed in situations over the last few years which, basically, was the right place at the right time. That meant that I seem to be doing fairly well in my professional life and managed to do pretty early what I set out to do when I started- earn a significant amount of money. No, I am not an ambitious person, and I know I am not going to become the CEO of Citibank or something nor do I really want to. A nice one room house in a
hill station , with lots of good books, a decent
Internet connection and pizza once a week is my version of paradise.
That being the case, I realize that I am in a sort of an inflection point where I am supposed to take a few momentous life-changing decisions. Although, I am still not sure what I want to do, I
definitely know what I do not want to do- Work. So, rather than grope about blindly, I decided, to create a mathematical model, which would help me figure out the earliest year I can retire by.
So, I started with a set of assumptions, they were
1. Time value of Money should be ignored along with inflation and returns from savings. I figure, I can invest my nest egg at
at least the going inflation rate
2. I will be single for the rest of my life and obviously I will have no kids
3. I wont own property
4. I wont even be working part time so will have
no source of income once I retire.
5. I will have no source of income and hence will pay no tax.( I am also ignoring Capital Gains tax)
6. If I intend to buy a Car, I will need to buy it in the next 10 years and the maintenance will be negligible
7. Significant medical bills will be run up only when I am 50 and will be a constant Rs 50k/ year
8. I will run up a constant expense of RS 3,60,000/ year after I retire over and above medical expenses if any
9. I will live until 70 (I know I am overestimating. By a distance. Well, what can I say? I am going for the 'at worst' scenario here)
10. Even if I continued working, I will have to retire at 60.
With all this in place what did I find out?
If I manage to save 12 Lacs every year(Which is the maximum I'd be able to save if I stayed here in the US), I will be able to retire by the time I am 38. Wow! That's just 10 more years! Isn't that absolutely Fantastic? To accomplish that, I need to do the following before I retire
1. Buy a house in a hill station. Probably in one of the more remote areas and a car. I should find some way to finance it. I will probably take a loan. Damn that would bite!
2. Get a job here in the US and stick to it for the next 10 years. Basically make as much money as its possible.
3. Cut down on unnecessary expenses.
4. Try and pile up as many books, music and movies as possible. If I am going to do nothing for 40 years , I'd better start
collecting stuff to entertain me
5. Learn some basic electrical and plumbing stuff. That will help both save money and independence
6. Learn some art/craft/skill, like painting, sculpting or wood crafting
7. Cut down on bad food and stop abusing my body. I
don't want to be sick and dying as soon as I retire. Believe me, I'm heading for an
at least an Ulcer by the time I am 30, the way I am going
8. Learn cooking and basic tailoring
9. The last thing and by far the most important point- Do not, I repeat do not fall for a female. That will undo everything. Unless she is super rich and well you can divorce her and get some alimony. Considering the chances of that happening let's just stay away from women
PS: If you are interested in the calculation, I have posted it in the following link
http://spreadsheets.google.com/ccc?key=pf-dO1LoEZr23C3QSzT9tYQ&hl=en