Early Retirement Extreme: A philosophical and practical guide to financial independence [Paperback]

Jacob Lund Fisker (Author)

Book Description

Publication Date: September 30, 2010

Early Retirement Extreme provides a robust strategy that makes it possible to stop working for money in just a short number of years. It provides a paradigm shift in economic perspective from consuming to producing. Your value to society is not how much you earn or how much you buy. It is what you create and produce for yourself and for others. It is what you leave, not what you take. Consumers are often locked into expensive options, but producers have the flexibility to create appropriate solutions at a quarter of the cost. The resulting savings (the difference between income and expenses) is one's monetary contribution to society. When savings are put to work through investments, society will pay dividends which cover the remaining expenses resulting in financial independence. The strategy can also be used to pay off debt, travel the world, volunteer, go back to school, or work on otherwise nonprofitable endeavors without worrying about the next paycheck. It offers a compelling alternative to the default choice of graduating high school, getting a college degree, buying a car, getting married, buying a house, filling it with furniture, clothes, TVs, washing machines, lawn mowers, and electric egg boilers, and then spending the next 40 years working 9-5 to pay it all off.

Editorial Reviews

About the Author

Jacob Lund Fisker retired early at 33 years old. He did this by figuring out how to spend very little money by living simply and learning many skills to become more self-sufficient thus reducing his need for money to a quarter of the average person. Instead of spending the other three quarters of his money on stuff, he invested it for income to pay for the few things he can not make himself. This meant he reached financial independence at age 30 and no longer works for a living. He now spends his time volunteering for nonprofits, crewing on racing yachts, practicing martial arts, and writing the earlyretirementextreme.com blog to show others the way to financial freedom.

Product Details

• Paperback: 238 pages
• Publisher: CreateSpace (September 30, 2010)
• Language: English
• ISBN-10: 145360121X
• ISBN-13: 978-1453601211
• Product Dimensions: 8.9 x 5.9 x 0.6 inches
• Shipping Weight: 12 ounces (View shipping rates and policies)
• Average Customer Review: 4.4 out of 5 stars  See all reviews (38 customer reviews)
• Amazon Best Sellers Rank: #13,885 in Books (See Top 100 in Books)

More About the Author

Jacob Lund Fisker was born in Denmark in 1975. He got his first computer when he was 12 and subsequently trained himself to sit in front of a screen for up to 16 hours a day. This was good preparation for what was later to come. At 24, he moved to Switzerland and spent 4 years researching certain details of neutron star physics which are immensely interesting to about five people in the world. During that time he became interested in strategic resource shortages and ran a very popular website on peak oil. He also became a bit of an anticonsumer. After getting a PhD in theoretical physics, he worked as a researcher for another five years while giving talks at places like CERN, Princeton, Los Alamos, Notre Dame, etc. Having saved most of his income he found himself financially independent at 30. A couple of years later he started a blog on earlyretirementextreme.com to show others the way to financial freedom. The blog quickly proved to be interesting to more than five people in the world and so he retired from science at 33 to pursue his writing.

He enjoys really spicy food and making predictions about the fall and decline of civilization (not necessarily related) and other complex systems like the financial markets. He only eats one time per day. He practices Japanese sword arts and yacht racing, doing an occasional ocean race. He also finds it a little bit weird to write about himself in the third person.

Customer Reviews

Most Helpful Customer Reviews

50 of 53 people found the following review helpful:

5.0 out of 5 stars A must read early retirement book!, October 9, 2010

By 

Douglas E. Thompson "Klipsch fan" (Indiana) - See all my reviews
(REAL NAME)   

This review is from: Early Retirement Extreme: A philosophical and practical guide to financial independence (Paperback)

This gem of a book will be helpful for anyone trying to rid themselves of the consumer mentality. I will keep it on hand to refer to whenever I feel the "need" to buy something. The author gives many alternative solutions to everyday needs that can be had for little or no money. Although, it is most definately not the typical thrift manual that tells you what to buy and what to eat and what to do. It is more of a philosophy of living where the author shares what has worked for him and also offers a complete realm of other ideas as well a how to think about and analyze the many choices for each situation.

Similar topics are covered as in the blog [...] but they are covered much more thoroughly. The book is NOT a simple copy of the blog.

Topics discussed are philosophy of lifestyles and consumer mentality, different philosophies of working, and then onto more practical matters such as transportation, housing, food, exercise, investments. The author also touches on dealing with a spouse that isn't "on board" with the lifestyle and dealing children while trying to live thoughtfully which I found to be very accurate.

This would be an excellent addition to the library of anyone interested in decreasing consumption, retiring early, saving money, and developing wortwhile activities.

34 of 36 people found the following review helpful:

5.0 out of 5 stars A comprehensive, fantastic book, October 13, 2010

By 

Jeffrey Sims - See all my reviews

This review is from: Early Retirement Extreme: A philosophical and practical guide to financial independence (Paperback)

This book is for anyone who aspires to create a different reality for themselves. If you are comfortable slaving away at your "career" for the next 40 years, saving 5 to 10 percent of your income with the hopes of one day retiring, then this book is NOT for you. If you work so you can buy things, then work to service the debt required to buy even more things, then this book is NOT for you.

However, if you think that the American Dream is alive and well, yet albeit not in the traditional sense, then you need to read this book. If you can be focused, patient and disciplined to attain a goal that is within reach of anyone who wants it, then you need to read this book. If you dare to be different, if you enjoy finding an alternative to the mundane same ol', same ol', then you need to read this book.

More specifically, this book is for anyone who is looking for the philosophy of living a different lifestyle, one that frees them from the chains of the typical corporate life.

First, let me explain what you will not learn in this book. You will not learn the next great investment strategy. You will not learn how to flip real estate, how to make millions on the Internet or how to turn a small investment in a penny stock into millions. This book is about so much more than getting rich. In fact, it is not even about getting rich, rather it is about becoming wealthy.

What you will learn is a philosophy for living detached from the economy. You will learn how to provide for yourself by being efficient and sustainable. You will learn how to change your perspective so that you can see how it is possible to live on less while living more.

Really, one of the strongest points of this book can be found in the old adage "Give a man a fish, he eats for a day. Teach a man to fish, he eats for life". And that is what the author has done here. You will not find a step by step guide to saving money to retire extremely early. What you will find are the principles required to change your life in order to make the changes required for early retirement extreme (ERE).

If anyone is looking for "21 simple ways to save money" then just do a search in Google and be on your way. This book is not for you...yet. But when attacking a problem such as ERE, which is unconventional to the majority, then unconventional means are necessary. Therefore, the author presents the principles that one can apply themselves in order to live on less and save more.

For me, some of the most positives came with the diverse contents of the book. For instance, the author talks about systems and models and learning common systems so that one can solve their own problems. This reminds me of what Charlie Munger says for investing...that is building mental models of businesses to see how they fit into the larger picture. This didn't make much sense to me until I read this book and it made much more sense.

Another major positive is just how thorough the book is. Just the sheer amount of information covered is impressive. For example, this book covered everything from eating, exercise, housing, transportation, clothing and a myriad of other things. The author had a knack for anticipating what I might question and provided an answer before I could finish my question. For example, when talking about walking in the rain, I had questions about getting wet, which of course was addressed in the subsequent discussion.

The only section that left me wanting more was the section on investing. The author alluded to the fact that he was a stock investor...of which I am one as well. Ironically, had the author said he was a real estate investor I would probably not have the same complaint, since I have no interest in real estate!

Anyways, since the assumption is that one will live in part or in full off their investment income, I was hoping for a bit more discussion on the mechanics of this, particularly from the authors point of view. However, this would have been seen as an "endorsement" so to speak for stock investing, which the author pointed out and we are all aware, there are multiple ways to invest (real estate, commodities, etc.). That said, I am not sure exactly how the author could have satisfied my need for more information on the investing aspect so perhaps this is something that would be better addressed in another book (a sort of sequel...after ERE is attained, perhaps?)

Overall, this book is certainly the most different and most complete book I have read that I can categorize as a personal finance book. The only weak point was a lack, or rather a perceived lack of detail around investing. Of course, this is EASILY overshadowed by the thorough content elsewhere in the book. As the author states, it is simple to learn about investing, one must only be willing to put in the time.

This book will provide the reader with the framework that is necessary to do something extraordinary with their life. This book doesn't give you the answers...it teaches you how to find the answers and in my opinion is much better than just a random collection of tips. I recommend that the novice read something a little simpler before tackling this work, perhaps Your Money or Your Life. Once a small base is built, I wholeheartedly recommend this book to anyone with the wherewithal to make a major change in their life.

As Morpheus said "You take the red pill and you stay in Wonderland and I show you how deep the rabbit-hole goes." Take the red pill....come down the rabbit-hole.

15 of 15 people found the following review helpful:

4.0 out of 5 stars Insightful, Detailed Analysis of the Early Retirement Mindset, October 13, 2010

By 

Mike - See all my reviews

Amazon Verified Purchase

This review is from: Early Retirement Extreme: A philosophical and practical guide to financial independence (Paperback)

This book is an analysis of the modern consumer mindset, our culture of debtors, an economy of specialists all dependent upon one another for their expertise, and it presents an alternative option for the lucky few who have the drive, mindset and courage to go about life a little differently. The author presents an alternative to devoting your life to a career, financing an appropriately luxurious vehicle depending upon your income, mortgaging an over-sized house, filling it with 'stuff' and then working 40 years to pay it all off.

The book analyzes where the consumer culture came from and picks apart the details of what it means to live in a consumer culture. The book has great moments. The author compares a working man, who makes his living by selling his time, to a farmer. And he compares a man who lives off managing his assets to a hunter. A farmer always has something that can be done, and so hard work and busy-ness are his virtues. "The more he does, the greater his reward." But a hunter must wait quietly for his opportunity to strike; patience is his virtue. And so it can be hard for a farmer, who has accumulated enough wealth to live off his assets, to suddenly become, or to even understand, the patient inaction of the hunter. A life sitting around patiently collecting interest on investments might look like no life at all to the habitually "busy".

The author makes a compelling argument around savings rates and compounding interest to show the tremendous worth of quickly saving up your assets rather than putting away 10% for 40 years. I also appreciate that the book is written without particular investing or career advice. As the author notes, any investment advice he could offer would be quickly outdated, and how one invests one's assets isn't nearly as important as developing the mindset that one ought to be an asset holder at all.

So many people live unexamined lives that lead to risky financial decisions, the wasting of thousands of dollars of resources, and ultimately pointless toil. For the few who have the curiosity to even read a book like this, they will be empowered with the knowledge that there are viable alternatives.

The book includes a detailed table of contents, index and extensive recommended reading list. It is all well laid-out.

I will say this book could turn off people who are new to the idea of early financial independence simply to due to its depth and complexity. If you're looking for an overview of what the early retirement life is about or are just beginning to flirt with the idea yourself, well, this ought to be the 2nd or 3rd book you read on the topic. If it's the first I'm afraid you might get intimidated, even though it is all spot-on, by the hyper-logical and analytical narrative style.