Retiring at 50, how does that sound? For many years it seemed like a fantasy, an unexpected inheritance, suddenly finding out that your grandmother was the Queen of Genovia. Something that, in short, never happened to us. Alex Trias is an American who, in 2011, decided to leave his job as a lawyer and now life has allowed him to retire at 41, clearly a dream for many.
But it was not all luck. Trias managed to save a six figure amount in his checking account, and then he left the country for Portugal. He says he looked for a country where he could live well, and he started saving up to 4,200 euros per month. Some of us would have to be born again to save that amount every month.
When salary stops being the most important thing
For years he did “what he was supposed to do”. He worked in a good job, had a good salary in a big city. The pace of his life was different, but everything seemed to be going smoothly. But a work crisis forced him to stop and ask himself if he really needed everything he had.
The answer was no. A high salary comes with equally high expenses, and the problem was not how much he earned, but how much he spent.
A radical change
Trias went from a big city with high taxes to Portugal, not to live large but to live better. He had more affordable housing, cheaper insurance, and without needing to live on pasta with tomato sauce every day of his life, he began to lead a more human life.
What did he do?
Spend less and invest what he earned. That is it. He did that before leaving his job and continued doing it afterward. Clearly it worked out well for him. That does not mean that everyone who invests will have the same result. Act carefully because these are serious matters, please.
Why Portugal?
Portugal is a good country. It has a good climate, a good healthcare system, and one of the richest cuisines, for sure. When you choose a place to live, these are things you value. What is the weather like, what will social life be like. Life is not only about working, it is also about enjoying it, even if sometimes it does not seem that way.
And in addition, an important fact is that in Portugal you pay less tax than in the US, and daily expenses are also much lower.
Living off investments
Financial independence did not fall from the sky. He saved, diversified, and had a lot of patience. He saved everything he could together with his wife and they started investing, but sensibly. No quick bets or crazy things.
We remind you again that this does not work out for everyone and that investing always carries the risk of loss. You have to do it very carefully, please.
Is it a plan for everyone?
No. Trias was lucky, but being honest, none of us could decide to leave our job at 41 unless we are aristocrats or win a lot of money in the lottery.
They always tell us to review expenses, rethink our lives, save. They never tell them to raise our salaries.
A lesson?
Trias’s case is one in how many? He dared to take a risk and it worked out. He changed his entire life and it worked out. He chose to live with the essentials, without luxuries, and that also worked out. What we need to be clear about is that work cannot take our lives away from us, because we only have one. So if you feel overwhelmed, we are not telling you to do the same as Trias, but to look for other options, right?