You wake up. Go to work. Get home. Repeat. For many, it feels like being stuck in a hamster wheel. What if you decided to call it quits and retire early? If you’ve ever wondering what it’d be like to walk away from the rat race… this article is for you.

Whether you want to retire and sail away, or you just want to retire and pursue hobbies¬—that part is up to you. But let’s explore what it takes to make an early retirement a reality. I recently had dinner with a college buddy that started sailing a MacGreggor 26, and since the idea of sailing away has a certain ring to it, we’ll use that as our goal.

Will you work part-time?
The first big question is, will you earn an income in retirement? Some people continue to work in a limited capacity with freelance writing, graphic design, or consulting, etc. Others just live off their investments. Let’s assume you’re going to quit everything and just live off investments. It’s more fun that way.

Save, save, save
Before you cut the cord, you’ll need to earn as much as possible for as long as possible. At the same time, you’ll need to cut your expenses. Cutting expenses is a quick win, while trying to earn more money can be difficult and take longer to achieve. For example, a $1,000 cut in expenses is like a $1,330 raise (assuming a 25% tax bracket). So, gym memberships, fancy cars, eating out, expensive phones, lawn service—goodbye.

The 4% rule
Saving enough money so you never have to work again is a tall order, especially if you’re in your 50s with a long life ahead of you. To figure out how much you’ll need to save, we look to the 4% rule. It’s a rule of thumb used to determine how much to withdraw from a retirement account each year. The 4% rate is considered a “safe” rate, with the withdrawals consisting primarily of interest and dividends, leaving your principal intact.

What will you spend each month?
You’ll need to figure out your monthly living costs. The good news about a boat is, you have limited expenses. Sure, you’ll have to buy the boat. But you can get a used 40-foot sailboat for about $60K. Much cheaper than a house.

Boating expenses
Even though you’re living in 150 square feet, you’ll still have to pony up cash each month for marina fees/docking, boat insurance, food, health insurance, and more. Based on sailing blogs, the monthly cost for a couple living on their boat in the Caribbean is about $2000. My clients are use to a little more, so we’ll say $2,000-$3500 a month all-in.

Ok, gimme a number
There are a lot of variables when it comes to determining how much cash you’ll need to save in order to retire. They include your age, any health issues you may have, Social Security savings, etc. So, it’s very hard to provide an accurate number without having more details. But for rough back-of-the-napkin-math, a couple will need to sock away at least $800K into investments in order to live off $3,000 a month. Again, this is very rough math, you’ll need to work these numbers out carefully on your own—or better yet, with a financial advisor.

Whether you want to leave it all behind and hit the high seas, or retire early and make model train sets, you’ll need to go through a rigorous retirement-income planning process first. But the good news is, if you’re feeling like a hamster, there are ways of getting off of that wheel forever. It just requires crunching some numbers and dreaming big.

About the Author

Richard Feight is a Fee-Only Certified Financial Planner™ and Professional NAPFA-Registered Financial Advisor at IAM-Financial. Rich has 20 years of experience offering low cost “Fee-Only” comprehensive financial planning and investment advice. For more information, email:

Rich Feight, CFP
Rich Feight, CFP

Hi, I'm Rich Feight I'm a fee-only Certified Financial Planner, successful business owner, and self-made millionaire that knows how to beat the system and become wealthy. I have a lot of clients that have done it too. I'm also pretty good at finding that ever-elusive work/life balance so many of us strive for. Lucky for you I have an abundant mindset and give all my knowledge away on my blog. So if you want to know what it takes to become a millionaire, follow me.