Early retirement can be achieved in seven steps.

  • Self-made millionaire Grant Sabatier retired early at 30 years old with a nest egg of R17.7 million by using a seven-step strategy, which you can use for your own path to financial independence.
  • First, figure out your target number for financial freedom, determine how to get there by calculating your net worth, and overhaul your mindset about money.
  • The next four steps involve action to achieve that number: Stop budgeting, hack your full-time job, start a side hustle, and invest.


Having retired at 30, Grant Sabatier has mastered financial independence. He became a self-made millionaire in five years, retiring with a nest egg of $1.25 million (R17.7 million).

It may sound impossible, but Sabatier says it's not if follow the same seven-step strategy he used.

"This plan works because it's designed to maximise all areas of your financial life," he writes in his book, "Financial Freedom: A Proven Path to All the Money You Will Ever Need."

"Each of the steps build on the others and the sum of the steps is much greater than each one on its own," Sabatier says. "If you follow the plan and stick with it, I promise you will end up with more money than you ever thought possible."

You can also pick the best ideas that work for you and still get results, he says, because it's a "customisation, scalable," strategy that can be used indefinitely.

Read more: I retired at 30 worth R17.7 million, and I'm convinced anyone could do the same if they follow 5 steps

1. Figure out your number.

According to Sabatier, "your number" is the amount of money needed to reach financial freedom, whatever that means to you.

"Maybe it's how much money you need to get out of debt, save six months of expenses, have enough money so you can take two years off to travel the world, or have enough money to live the rest of your life without ever having to work again," he says.

Ultimately, it depends on the type of lifestyle you want to live. You can determine your number by calculating your expected annual expenses and multiplying it by 25 or 30.

The younger you are, the less money you need to have saved before you retire from full-time work because of the power of compounding, according to Sabatier.

But that's if you follow a few rules: Save at least 25 times your expected annual income,defer="defer"taking investment gains as long as possible, expand your six-month emergency fund to 12 months, live below your means, and preserve your investment principal.

2. Calculate where you are today.

Once you establish your number, you need to calculate your net worth, which Sabatier calls your "financial scorecard." To do this, add up your assets (cash, house, investments, etc.) and subtract liabilities (debt).

You can calculate how close you are to your number by subtracting your income-generating investments in your net worth from your number, Sabatier says.

"If you keep saving and investing, your net worth will keep growing, and because of compounding, the growth will accelerate," he writes.

According to several early retirees, one of the keys to achieving financial independence lies in tracking your net worth. It can help you figure out where you stand financially and set goals, according to early retiree Sam Dogen.

But don't obsess over it, or it can pull you off course.

Read more: A woman who studied 600 millionaires says there's a misconception about wealth that just won't die

3. Shift how you think about money.

"If you keep thinking about money the same way you always have, then you won't make as much money as possible," Sabatier writes.

Building any type of wealth, he says, relies on the same three variables: income, savings, and expenses.

"The problem with most personal financial advice is that it focuses primarily on two of these three variables: how to reduce expenses to increase your savings," he writes. "In order to build wealth quickly, you need to maximise the potential of all three levers. By reducing expenses while simultaneously growing your income, you'll have more money to save/invest, which will help you increase your savings rate."

He adds: "While both are essential, to fast-track financial freedom, increasing your income is more powerful than cutting back on your expenses because you can only cut back so much and it gives you the opportunity to invest more money more often, accelerating the rate of compounding and the growth of your money."

4. Stop budgeting, and focus on what has the biggest impact on your savings.

While it's important to track your spending habits, it's not where you should dedicate most of your time, Sabatier says. "Budgets actually reinforce a scarcity mindset and hold most people back from saving and making more money," he writes.

He likened budgeting to dieting: "The more guilt you feel, the less likely you are to stick with it."

Instead of cutting back on the small expenses, he recommends controlling the biggest expenses - housing, transportation, and food. It will increase your savings rate by at least 25%, he says.

Even millionaires forgo budgets, according to John of personal finance blog ESI Money, who studied self-made millionaires for a few years.

5. Hack your 9-to-5.

Sabatier recommends strategically using your full-time job to make more money now and in the future. It's essential if you want to reach your target number in as few years as possible, he says.

You can do this by maximising your benefits - like a 401(k) - and maximising your salary by proving your value and asking for a raise, which sounds intimidating but is easier to navigate if you're prepared.

It's equally important to negotiate your salary; it could make a $1 million difference in your lifetime earnings.

You should also take advantage of your skill set and networking, he says.

"Skills are the currency of the future," Sabatier writes. "The more valuable and diverse your skill sets are and will be, the more money you will make. Keep building your skills and your network and they will pay huge dividends over time."

6. Start a profitable side hustle, and diversify your income streams.

"Side hustling to invest will fast track your investment growth," Sabatier writes. "Every side-hustle dollar you invest reduces the amount of time it will take to hit your number."

While it's easier than ever to start a profitable side hustle, most people do it wrong, Sabatier says. They either spend their time side hustling for someone else or try to grow a side hustle "doomed from the beginning." Either way, you're not making as much money as possible.

The most lucrative side hustles are those that generate passive income, he says. Building a passive income business that generates a minimum amount of money to cover your monthly expenses "gives you more flexibility and potentially the opportunity to reach financial independence very quickly," he writes.

Consider JP Livingston, who retired early at age 28 with a nest egg of more than $2 million (R28.3 million) and then earned more than $60,000 (about R850,305) in one year from her blog. With the use of affiliate commissions and online advertisements, a good portion of these earnings were passive income. She spent less than five hours a week blogging.

Read more: Retiring early doesn't mean you'll stop making money. How one retired millennial made more than R850,305 in passive income last year.

7. Invest as much money as you can, early and often.

"When you invest money, your money makes money and you don't need to trade much, if any, of your own time," Sabatier writes. He calls investing "the ultimate form of passive income."

He advises separating your short- and long-term investing goals and setting a baseline number to invest in each account over each period, then determine your target asset allocation, or the percentage of each asset (whether stocks or bonds) in your investment accounts.

You should also evaluate investment fees, he says, because they "can have an enormous impact on how quickly your money grows, how much money you'll have within a given time frame, and how many years it will take you to reach your number."

He also emphasised maxing out your tax-advantaged accounts and opening a taxable account with any money left over.

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