"Early Retired Millionaires Share Financial Regrets"

Boston Brand Media brings you the latest Insights from three self-made millionaires who retired early shed light on their top financial regrets. Common themes include underestimating healthcare costs, not diversifying investments enough, and not seeking professional financial advice sooner. These reflections offer valuable lessons for aspiring millionaires aiming for financial independence and early retirement.

Early retirees often have ample reasons to boast about their financial acumen.

Typically, to retire in one's 30s or 40s, individuals must have amassed substantial streams of passive income or saved enough in investment accounts to sustain themselves indefinitely — accomplishments that require both financial savvy and discipline.

Boston Brand Media also found even those who have achieved this level of financial independence harbor regrets.

CNBC Make It interviewed three early retirees with seven-figure net worths who have no qualms about living life on their own financial terms, yet acknowledge a few things they wish they had approached differently.

‍The Practice of Saving the Bare Minimum

Steve Adcock retired at the age of 35 in 2016, with a nest egg of around $900,000, which soon grew to over $1 million thanks to gains in the stock market. While he eventually saved a significant portion of his salary and invested it, he admits that wasn't always the case.

"The one thing I really wish I did more of was saving, and especially investing more aggressively," he reflects. "It’s exponential growth. The longer you invest, the more money you’ll have at retirement. Period."

Adcock confesses that in his early 20s, he only did the "bare minimum" when it came to saving.

"I was saving 10%, which is the commonly recommended saving/investing percentage of your income," he explains. "So at least I was doing that."

Although saving 10% of income is a reasonable starting point for many, Adcock emphasizes that to build the kind of portfolio necessary for early retirement, one must invest as much as possible, as early as possible.

‍Pursuing Peak Returns: The Quest for Maximum Gains

At age 41, Alex Trias made the decision to leave his job, and a few years later, he and his wife Noki relocated to Portugal, a popular destination for American early retirees. In 2015, they purchased a home in Lisbon and now sustain their lifestyle on dividend income from their stock portfolio.

During the early stages of his career, Trias found himself obsessively monitoring his investments, a habit that he now considers to have been detrimental to his mental well-being.

“My greatest regret financially wasn’t my spending, it was my thinking,” Trias reflects. “I used to think all the time about investing at a low price, waiting and then selling at a higher price. I cannot begin to explain the anxiety and waste this sort of mental framework caused.”

Over time, Trias realized that it was more beneficial for both his mental health and his investments to refrain from attempting to time the market.

“One of the things that works really well is an almost mindless habit of repetitiously saving and investing every [time] you get your paycheck, irrespective of what might be happening in the world economy or whether you think stocks are overvalued,” he explains.

This approach aligns with the investment strategy known as dollar-cost averaging, where investing a consistent amount at regular intervals not only helps avoid emotional reactions to market fluctuations but also ensures the purchase of more shares when prices are low and fewer when they're high.

‍The Consequences of Exiting Too Early

Sam Dogen exited his corporate job at the age of 34, boasting a net worth of approximately $3 million and a passive income stream of around $80,000 per year. While these achievements are commendable, Dogen reflects that they could have been even greater had he chosen to prolong his tenure a bit longer.

“Looking back, I could have stayed for at least another year and found a new role within the firm in a different office,” he muses. “I had always wanted to work overseas — someplace in Hong Kong, Taiwan, Beijing or London.”

Remaining with the company would have afforded him the opportunity to further bolster his retirement savings.

“I would also put 100% of the extra money earned into various risk assets like stocks and bonds. Assuming a 4% annual return, I could have generated an additional $20,000 or more in passive income per year,” he calculates.

However, instead of extending his stay, Dogen chose to depart and negotiated a severance package in return for facilitating the onboarding process for his replacement — a decision he considers to be a reasonable compromise. He even managed to utilize a few vacation days before bidding farewell to his corporate career.

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Source: CNBC