This is How Ordinary People Become Millionaires and Retire Early

7 simple steps to financial freedom

Ordinary people, just like you, can do extraordinary things. Even retire early, with a millionaire dollars. If you’re looking for a shortcut, this isn’t it. Instead, I’ll cover a series of extremely low-risk very high-reward simple strategies. It also takes the right mindset. Even better, it doesn’t require completely changing your life or lifestyle.

This article is going to be a culmination of my favorite and best ideas I learned in 2021. I’ll also share a handful of new strategies and ideas. I live and preach everything I’m discussing today on my road to early retirement. Here’s how ordinary people retire early as millionaires — and you can too.

(Near the end I have an announcement I’m extremely excited to share. Here’s a hint: it’s something I made for you!)

#1. THEY DON’T LOOK THE PART

Financially independent people rarely dress like they’re financially independent. They didn’t dress like extravagant millionaires to get there so why would they start now?

But it goes far beyond how they look and dress. It’s having the willpower not to splurge spend on fancy cars, new tech toys, more expensive jewelry, a bigger house than they need, frequent exotic trips, and the like. They save more as they earn more. They don’t spend more.

The majority of early retirees and millionaires are regular people that worked normal jobs from all walks of life, on all kinds of different incomes. Plus, 80% are first-generation self-made millionaires. Most never cared about impressing other people and having more money didn’t change that.

The millionaires that do care and do look the part — I’m guessing a good chunk of those are the 20% that didn’t become first-generation millionaires themselves. They’re the ones that are going to YOLO away their wealth and likely end up back at square one.

Every dollar you save aids in your long-term vision. Keep this in mind with every dollar you spend and every investment you make. The goal is to live a more rich and fulfilling life. Not to look rich.

#2. THEY HAVE A LONG-TERM HORIZON AND GOALS SET ACCORDINGLY

A few years ago, Chris Hogan surveyed 10,000 millionaires. He discovered 92% of millionaires surveyed said they develop a long-term plan for their money.

Early retirees and millionaires stayed focused on the future to get there. I do the same. I often think about Future Me. How would Future Me feel about the decisions I’m making today? Not the small day-to-day stuff — the bigger picture stuff like goal-setting, investing, and working hard to achieve my financial goals.

Thinking long-term consistently and actually setting quality goals becomes easier when you reflect on and develop a strong sense of why. As James Clear said, “You don’t rise to the level of your goals, you fall to the levels of your systems.” I believe a strong sense of why helps you build habits and systems that stick.

It’s important to dream-set before you goal-set. For most early retirees, the ones that ultimately made it happen, it likely started by envisioning the life they wanted to live long ago. You should try this dream-setting exercise as well if you’re only getting started.

How do you want to live your life? What are your passions? What would you do if money wasn’t an issue? Going through this exercise of dream-setting, envisioning how you want to live your life and why is step one on any early retirement or millionaire journey.

#3. THEY’RE OPTIMISTIC AND BELIEVE IN THEMSELVES

Chris Hogan also found 97% of millionaires agree with the statement “I control my own destiny.” Do you believe that as well? You should because you absolutely do, even if you’re currently feeling down, behind financially, or overwhelmed with debt.

There are countless stories of people in the worst situations or massively in debt like I used to be that have turned their life around with a can-do attitude and can-do spirit.

Developing a positive mindset about your money is everything. Positive people and future millionaires reject the notion that it can’t be done.

They have an abundance mindset. They know anyone can achieve early retirement status if they believe it, learn, take action, stay positive, and stay the course. They know they are in full control of their own destiny. They don’t let fear or doubt get in the way. They don’t give up when the going gets tough. They don’t make excuses. They don’t believe their success depends on anybody else.

Early retirement takes patience. It takes resilience. It takes optimism. Developing the right mindset is half the battle. Let’s start talking about the other half — the financial strategies and best practices half…

#4. THEY INVEST EARLY AND OFTEN AND LET COMPOUND INTEREST DO THE HARD WORK

79% of millionaires did so with their employer-sponsored plan — most typically a 401(k) in the US. 75% of millionaires make regular, consistent investing part of their ongoing personal finances. You must as well.

Investing is massively important to understand and act on because you cannot save your way to early retirement or $1,000,000 by stashing cash. It’s virtually impossible, I assure you.

Cash saved loses value every year — roughly 2 to 4% due to inflation. Investing is how you overcome that loss and then some. Over the long run, investing in the S&P 500 or a total stock market index fund returns 7–10% most years.

Then there’s compound interest, where the money you earn gets reinvested and that money earns money, and so on. All self-made millionaires know about this. Compound interest is the secret ingredient to early retirement and millionaire status. The earlier you start and the more money you put in, the more you’ll be rewarded long-term. It can be exponentially more if you do it young enough when time is on your side.

In terms of investing, early retirees were averse to massive risks. They didn’t invest in the latest meme stock, NFTs, open a dropshipping store, or other latest financial craze. They’re immune to get rich quick gimmicks and fad investments. You should be too.

#5. THEY ARE WILLING TO CHANGE JOBS & FOCUS ON DIVERSIFYING THEIR INCOME

Changing jobs is a fantastic way to boost your income. Most people that stay with companies for long periods of time — 5, 10, 15 years, or more — can get stuck earning the same amount of money. You might earn a 2 to 3% raise annually. You might earn a holiday bonus based on company and personal performance. However, that barely helps you keep up with inflation year to year.

Outside of asking for a raise (which is massively underrated) the best way to boost your income is by going to a new company. A new company might value you at 5% to even 25% higher than you make. Plus, you can often negotiate a new offer or take it back to your current job and see if they will match or beat it. I’ve done this several times personally, once earning a promotion and raise to stay put.

Many early retirees leveraged the concept of “raise-lattering”. It’s where when you get a raise or a new job for more money, you only increase your spending with 20% of that new money and you automatically save and invest the other 80%.

Further, many early retirees and millionaires went beyond their 9 to 5 and diversified their income via sides hustles, passive income, and investing. I personally try to invest 100% of side hustle money.

The average millionaire has 7 streams of income. I challenge you: make it a goal to add an income stream this month or in the next year.

#6: THEY LIVE BELOW THEIR MEANS AND INVEST THE DIFFERENCE

You don’t need a 6-figure job to become a millionaire or retire early. In fact, Chris Hogan found being a teacher was a top 3 profession of the 10,000 millionaires he surveyed. 93% of millionaires say they got there by hard work rather than big salaries.

In CNN’s article explaining how to become a millionaire on $56,000 a year they summarized this nicely:

“All you really need is a smart savings and investment strategy from the get-go, along with a willingness to adopt a lifestyle that supports that strategy. If you make savings a priority early on in your career, you’ll be well on your way to reaping what could be a significant financial reward down the line.”

It takes simple frugality and being smart consistently. Sure, it’s not a shortcut, but it’s also not extreme. That’s why I feel anybody can do it if they live below their means and invest the difference. It’s simple daily decisions like:

• Make shopping lists and stick to it
• Save for bigger purchases and pay in full in cash
• Stay out of bad consumer debt.
• Cook most of your meals and set limits on eating out.
• Buy used cars
• Budget and be sure to include savings in your financial plan as opposed to savings whatever is hopefully leftover.

Give yourself a raise by reducing your annual expenses and increasing your savings rate. Invest that difference and you’re well on your way to being an early retired millionaire.

Living below your means goes back to “not looking the part”. Goals. Consistency. Optimism. Investing early and often. Increasing and diversifying your income. And everything else I’ve covered so far. Small consistent efforts add up and compound. It’s how 1+1 can equal 3.

#7. THEY SAVE AND INVEST HALF

Yes, half. You might be thinking a 50% savings rate sounds crazy, but it’s less crazy than you think. It’s not for everyone, but anyone can do it. I am proof you can do it. Allow me the chance to prove it to you. Let me show you how…

I’m thrilled to announce my third book “Save Half, Retire Fast”. It is now officially available for pre-order on Amazon. It’s your complete guide to financial independence and early retirement from money mindset to retired millionaire. It’s all things FIRE Movement and it’s packed to the brim with all the strategies you need to know to achieve financial independence and early retirement.

It’s nearly 40 chapters and over 280 pages of my best advice and research. It’s a year and a half of hard work and research culminating in my 3rd finance book. It’s focused. It has one goal throughout: to get you on the road to saving half of your income so you can retire in as little as 17 years. And it covers it all:

• investing — how to and what to invest in
• creating passive income streams
• timelines and goals
• how to max out tax-advantaged retirement account and why
• the psychology of money
• 10 types of FIRE to help you discover the exact right path
• mini-retirements
• millionaire stats and strategies
• how to achieve FIRE in a big city
• how to retire early on a low income
• how to stay motivated on your FIRE journey
• my rules of money I live by
• how to achieve financial independence in one year.

Plus, of course, the mentality you need to develop to do it all— the most critical lessons I cover.

The best part is none of it is unrealistic or just for somebody else. It’s an optimistic guide. Something I’m very proud of is every chapter in the book has a companion YouTube video to bring the chapter concepts to life, reinforce the core ideas, and build on them.

I’ve been on my financial independence journey for 4 years now. I’ve improved my net worth by over $250,000 since starting from (negative) -$80,000. I knew almost nothing about money when I got started. But if I can get on the early retirement path and stay on the path and do so from scratch, I know you can too. Especially with my help, best tips, and advice you’ll find in Save Half, Retire Fast.

It’s good ol’ fashion timeless finance lessons that put together are far greater than the sum of their parts. It’s how anybody can achieve early retirement and millionaire status, a decade or more sooner than they thought was possible — because save and invest half, retire twice as fast.

Ordinary people on any salary can accomplish extraordinary things when they get resolved about it. I know I can. I believe you can too. I want to escape the rate race and I’m on my way to making it happen. I’m on my way to buying my time and freedom back, and I want to show you how to do the same. Let’s do this together.

Happy holidays and happy new year. Let’s make it a great one.

Watch the video companion to this article here.

Frankie Calkins (M. Ed) is a Digital Marketing Manager by day. On nights and weekends, he’s an author, YouTuber, and finance course creator. He lives in Seattle, WA. Contact: [email protected]

This article is for informational and entertainment purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.