Early Retirement Case Study - Billy and Akaisha Kaderli

[This post is written and copyrighted by FIRE Finance (http://firefinance.blogspot.com).]

Bill & Akaisha KaderliIn our popular post "Top Resources For Early Retirement Planning," we had presented a short profile of Billy and Akaisha Kaderli. They are well known for having reached FIRE really early. Today while browsing through Kiplinger archives we found a detailed case study profiling Billy and Akaisha's early retirement and how they achieved it. Here is an interesting excerpt.

When they were in their late thirties, Billy, a stockbroker, and Akaisha, a restaurant owner-turned-office manager, decided they were working too hard and paying too much in taxes. They vowed to save enough to quit in two years. "Every time I looked at a latte or a new pair of shoes, I decided I didn't need them," says Akaisha. "If you are clear about what you want, it becomes easier. You can either buy this or be days closer to your goal."

By 1991, they had accumulated about $500,000, including a $100,000 profit from the sale of their home. They put their belongings in storage and set out to see the world.

What's their secret?

This might sound like an extravagant lifestyle, but Billy and Akaisha limit their expenses to about $24,000 a year. They eat well and enjoy themselves but don't buy much "stuff." Their few big expenses include Akaisha's extensive dental care in Thailand and a laptop computer they use to update their web site.

The couple invest mainly in low-cost index funds, withdrawing about 3% of the balance each year. They pay little in taxes because most of their income is from capital gains and dividends, which are taxed at a maximum of 15%. They haven't had to touch their IRAs, which would still cost them early-withdrawal penalties. "At this point in our lives, we are less worried about running out of money and more concerned about not having enough time to enjoy it," says Billy.
We can learn a lot of interesting lessons from this couple who achieved FIRE in their late thirties! You can follow the entire story here.

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