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20 Is the New 50


Don’t let retirement sneak up on you.

The world looks different from my side of the desk. Three decades working with clients dreaming of retirement and the good life has revealed things you can’t fully understand unless you see it with your own eyes. We hear crazy talk like 70 is the new 50, indicating people at age 70 are as active as people once were at 50. Bullshit! I would be happy as hell if I could pry some people’s asses off the couch for more than a trip to the fridge at age 20. The noises they make is a tell; they are ready for the nursing home by 30. But I digress.

There is good news, however. Twenty is the new 50. It goes like this: the same people return to my office year after year as broke as they were in prior years. This goes on for decades. Then one day they hit 50 and realize, “Holy shit! I only have 15 years until retirement.” Spending slows and investing increases. Now they are open to the Wealthy Accountant’s advice. Fifteen years later my happy client reaches retirement with a nice nest egg. Now image how soon they could have retired if they had their “Holy shit!” moment a bit earlier in life.

The New Age Paradigm

Make no mistake; the pattern is still firmly in place. Convincing a client to slow spending and max out retirement accounts is an uphill battle. The excuses have remained consistent over the years: I earned a Hummer, SUV, 4-wheeler, boat, and on ad nauseam; I deserve a vacation; I work hard so I deserve an over-sized home; after a long week of work I need to party all weekend to unwind. Giving up bowling would be a cold day in hell until age 50 arrives.

However, I see more light at the end of the tunnel than ever before. I started saving in high school because I was greedy and wanted to be rich. Later, when I discovered I crossed the seven figure mark without noticing around age 32 I knew money was no longer the goal, only a tool. The goal in high school was to sock enough money away so I never had to work. It made sense back then. I grew up on a farm and milked cows every morning at 4 a.m., went to school, came home and milked cows for another four hours. I hated the work, I hated farming, and I hated the long hours. I wanted a life.

Only when the farm was gone and I was away from it for a few years did I realize how much I loved the farming lifestyle. I made almost nothing working all those hours in high school, but I saved every dime. Back then banks paid 10% interest. Even savings accounts paid 6-7%. In 1979 I discovered the stock market. I was only a sophomore in high school, but I understood the value of business ownership. Interest rates were high back then. I understood interest rates could change, as in “go down”. Dividends change too. They sometimes go down, but the market as a whole sees dividends chug higher almost every year. I was not allowed to invest my money until I reached 18; all I had was bank deposits.

I was ready on my 18th birthday. All my money was moved from the bank to the MFS MIT fund. The sales guy said it was the oldest mutual fund in existence. I liked that. He also said the fund still held the original shares of GE purchased in 1924. I was impressed. The Dow Jones was around 800 at the time. Then I experienced the luck only youth can bring. The stock market began its 5-year mega-run in August. By 1987 the broad U.S. stock market had rallied over 300%. The bank deposits would never have competed.


Toying with retirement is dangerous. Time to get serious.

Better To Be Lucky Than Good

Working on the farm only paid $50 a month. I saved every penny and earned a great interest rate at the bank compared to today, but a 300% return on a small amount brings me only part-way to retirement. I was 23 and full of anxiety. I discovered the ever beautiful Mrs. Accountant and wanted to settle down. It seems like I have always been in the right place at the right time my whole life. Sometimes I think if I ever fell into a vat of shit I would come out smelling like roses.

There is no doubt I was born at the right time. I reached the age of maturity when stocks were primed to rock ’n roll. So, with all the market timing luck of being born at the right time, how have my classmates done financially? Not good. Of course, they had fancy cars, clothes, expensive weddings (yes, plural; they also had expensive divorces), exotic vacation, and enjoyed the best restaurants.

Kids today do not have it so good. Back then the S&P 500 had a PE ratio under 10 and a dividend yield of 6-7%. (I am running off memory so feel free to fact check me in the comments.) Today, as I write, the PE ratio of the S&P is a tad over 25 with a dividend yield of 2.02%. I doubt we have a 300% bull market starting here and running for five years. No such timing luck for 18 year olds today.

There is a difference though. Those damn kids today think they are 50! Not all, mind you, but enough for me to notice. For some reason there is a growing group of 20 year olds who act like they just turned 50 and had a “Holy shit!” moment. Think of it. Pete over at Mr. Money Mustache retired at 30. Gwen over at Fiery Millennials  is 25 and well on her way to financial independence. I have no doubt she will reach financial independence by age 30. Even Brandon, the Mad Fientist, is retiring later this year. I met the guy twice. Don’t know his age, but he is a young feller. Pretty soon I’ll have no choice but to retire just to keep these young whippersnappers in line, dammit! There goes my promising bridge career in accounting.

20 Will Get You 15

Starting at 20 is so smart. It is refreshing to see more people jumping on the FIRE (financial independence, retire early) lifestyle. Some people retire as soon as they can. Others, like me, tried backing away from our businesses and found we prefer our business lifestyle. To each their own. All I can say is the FIRE people have me thinking like never before. After all these years I have a lot of people around the country, around the globe, I could visit. If I would not miss the clients so friggin much I would go all-in.

Many moons ago there was a commercial (yes, I have allergic reactions to commercials) by a financial services firm. The commercial showed an archeological dig with several college kids working the site and complaining about the hard work. An older guy, about 35 was also working the site. One of the college kids said he could not wait to retire so he could leave all the hard work behind. He then turned to the 35 year old and said arrogantly, “When you get to retire?” Which the older guy replied, “I already did.” That shut the kid up. Think about it and you will get the message. Like I said, to each their own. Real retirement allows you the ability to choose your daily course.

The great thing about starting early and getting the retirement issue out of the way early is that it allows you to explore avenues unavailable any other way. You can bitch like the college kid or you can retire to the very same archeological site to explore a world never seen before. Once you no longer have to do something is when you discover if you really liked it or not. I hated milking cows with a passion when I was in high school; never went back to milking as an adult. I did love animals so I spent 20 years of my life raising steers. The work is hard and my body has scars to show the bad days. I would not change it for anything. I miss my boys (the steers), but that part of my life is over now. I toy with going back, but I know deep down I never will. Sometimes when I am on the road travelling and I see a herd of bovines a tear comes to my eyes. The memories are fond ones.


The Accountant family with nieces enjoying a friendly 5K run for a good cause.

Choices, Or Just Really Important Decisions

Successful people know winners decide to win. I ran a profitable farm because I decided to do it and then worked my tail off making it happen. The same is true for my tax office, hedge funds, rentals, and other minor businesses I ran over the years.

My current itch is writing. I always thought writing would be a ticket out of the poverty of farming. Little did I know writing is the only job that pays worse than farming! I only jest a bit. I have written a lot of material over the years. I assume I have found my voice. I hope it sounds better than fingernails on a chalkboard. (You young whippersnappers can Google it.) The writing projects I have in mind are varied. This blog is one of those dreams. There are certain goals to reach for me to feel content. I may never check it off my bucket list. I love putting words on paper (if you young bucks can’t handle my terminology you can leave the room). I enjoy telling stories. I have a few more novels in me. I’m not sure I want to put my real name on them, however.

If a farm boy like me pulling teats eight hours a day can decide with absolute conviction, so can you. With no money—it was all tied up in mutual funds—I still managed to invest almost all my earnings. I bought a home and a car when I left home at 22. The choice was simple and still is. You can start right now, today, investing the bulk of your earnings, or, you can wait until your 50th birthday and walk into my office and say, “Holy shit!” Either way, it takes about fifteen years.


Tuesday 18th of April 2017

I am 22 years old, and up until 4 days ago, I had no idea early retirement and financial independence was even a thing. I had read 4HW by Tim Ferris, but the idea of "earn more money to become rich" remained. I've had a complete paradigm shift since the last couple of days, and I have you, MMM, Reddit and many others to thank for it. I feel super blessed to have found FIRE, and I'm more optimistic and motivated about life than I've ever been. Finally, I feel like there's more to life than work, home, sleep. Thank you!

Keith Schroeder

Tuesday 18th of April 2017

Glad we could help, firesoo. I think you will find this community awesome on so many levels. Our groups is made up of good people all wanting to live life well. I have no idea where a better deal could be had. Welcome to our community.


Wednesday 27th of July 2016

Haha! Nice post Keith. Keep writing man, I like the voice. Starting early is critical, having financial awareness and the vision to become free should get you there by 40 if you start right out of high school. 50% savings rate = freedom in 17 years (give or take).