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Personal Finance

Learn how my parents retired early in their 40’s

Hey Hustlers, it’s going to be a pretty intimate post today. I’m interviewing my parents on how they retired so early in life. My parents have taught me many money lessons throughout the years, many of which were just passively learnt from watching and hearing what they do. But I think it’s time I actually sat down with them and have a very deliberate conversation about how they managed to retire so early.

Especially since I want to beat them at their own game and retire at 35. Nothing like some friendly competitiveness.

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Money was never a topic you had to be shy or embarrassed to talk about. It actually took my teenage years to realise most families don’t talk about money and society in general think talking about money istasteless and tacky. It was a bit of a shock, because it was the complete opposite in my family. My parents grew up poor, not first world bread line poor, but actually not having access to education, clean water or electricity when they were kids, kind of poor.

So money was naturally a thing they thought about and talked about often. Anyone who knows how hard life is when you don’t have money will know how important it is to keep it once you get it.

How old were you when you retired?

Mum: 46

Dad: 51

How long did you take to plan your retirement?

Mum and Dad: We started thinking about it a little before the year 2000. That’s when we had the plans of building the house in Hong Kong and it was also a realistic possibility. We didn’t think about retirement before that. We officially retired in 2005, when we moved back to Hong Kong.

Who would have thought. 2 immigrants that didn’t speak a word of English would retire after 2 decades of hard work

How long did you work before retiring?

Mum: I started working at 7 or 8. I was helping Grandma with the beadwork at home and doing factory work in Hong Kong. I had my first official job at age 13 at a factory. I spent 40 years working before resting. It looks like we retired young and easy, like we didn’t do anything but we started working at a young age.

Dad: I started working at 14. My first job was at a dim sum restaurant pushing the dim sum trolleys, but I was helping your grandmother on the fields and herding the cows.

What did you do before you retired?

Mum: I did bead work and weaving work like most kids from poor families in Hong Kong. I then started knitting in the factories once I got older. I did a few sales jobs before marrying your dad and soon after marriage we started our small businesses.

Dad: I mostly worked at restaurants, first at the front end and then in the kitchen. I continued to work in restaurants when I went to UK at 18. I then started a business with my brothers and finally started  my own businesses with your mother.

How do you pay for your expenses now?

Mum: I don’t have many expenses other than my personal spending needs. I like to trade on the stock market to pass time. If I average it out over the years, I’ve made a good salary for myself just by trading on the market. Your sister use to give money on a monthly basis before she got married, and that went to general expenses like food. Now you give me money every month, but that goes to my personal spending like holidays, clothes or small unexpected expenses around the house.

Dad: The household expenses are paid by rental income, and dividends I get from shares I have. We have no debt or any other financial burdens to worry about. We live within our means and it’s more than enough so far.

Did you have a clear idea on how you wanted to retire, or did you figure it out over time?

Mum: We didn’t properly think about it. The opportunity just came and we took it. We saved our money and spent wisely. We had no debt and we had enough to live on.

Dad: I didn’t think about these things when I was young. I wasn’t educated and my parents didn’t teach us any of this. They didn’t know themselves. I just didn’t want to work so hard for all my life. I started working at such a young age that I just didn’t want to work anymore. We made the decision to retire once it seemed possible and realistic.

Would you do anything differently to retire earlier? 

Mum: Your dad didn’t listen to me when we were in Vancouver. I could have retired at 36 if we took the money we made and bought a few houses. I did the calculations and we could comfortably live off rental income. Your dad didn’t listen to me and I end up retiring at 46 instead. (then she rambles on all the other missed opportunities they missed because of dad not cooperating with her plans…)

Dad: …

retiring early
Click to learn how I did it

What’s your biggest advice for people who want to retire early?

Mum: You have to save your money. You need to learn to work hard and live as modestly as possible to save money. Then once you save your first lump sum, you need to learn how to invest it. That’s it. It all starts from saving money.

Dad: Of course you have to learn how to spend modestly. You need a way to sustain yourself after retirement. You don’t know how long you will live and so saving money alone is not a good strategy. You need to find a way to give yourself a steady stream of cash without working.

What’s the most important thing someone needs to achieve in order to retire early?

Mum: You need to a secure piece of real estate that is completely paid off. You don’t have to live in it, but having real estate you own outright means you have an asset. You can rent it out and take that money to rent somewhere for yourself. It doesn’t matter, but you need to sort out a place you can live, with zero financial worry.

Dad: You can’t have debt. You need to be debt free. We never had much debt ever other than the mortgage, our credit score was also really good.

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That’s the end of the interview guys. If you can learn anything from this, then it must be the following. My parents are just average people. They’re not super savvy financial know-it-alls, they’re just hardworking people who didn’t take shortcuts. Both my parents didn’t even attend school past the age of 11 and didn’t have a big inheritance or even a family to help them out. In fact, they both had to send money back to their family until marriage. They started from scratch and were diligent savers that took chances when opportunities came by.

And that’s the big lesson to retiring early. Diligence and patients. They never actively thought about retirement, but that didn’t mean they weren’t saving for it, or investing their money accordingly. The main idea they had was to grow their net worth and before they knew it, they were in a fortunate position of retiring at a young age.

And if I was honest, if my parents can do it under the circumstances they did it. NO ONE has an excuse to struggle with retirement.

…yet a lot of us do.

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