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How To Reach Financial Independence + Millennial Retirement

Financial Independence and Millennial Retirement: Redefining the Concept


For the reasons laid out above, the retirement definition will need to shift for Millennials.  That’s partly because when you look at the amount of Millennial retirement savings, the results aren’t great.

But it’s also because we can’t expect the same financial support programs that have helped others.  We don’t have the guarantee of a social safety net there to catch us if we fall behind.

Unsure of how the future will unfold, I find myself wanting to forge my own way built upon self-reliance, despite not necessarily knowing how.

The truth is, we don’t know what may come to pass- but it likely isn’t the status quo, because our country can’t afford it.  Because of these trends, our retirement plans must change.

With difficulty seeing what’s in our immediate future, let alone 40+ years down the road, we face hard money decisions our forebearers simply didn’t.

How many Baby Boomers had to navigate student loan refinancing or the Federal student loan system writ large?  My guess would be a lot fewer than us.

Baby Boomers went to school in droves at affordable prices.  They managed to make respectable livings by advancing their careers, earning pay raises, and saving money along the way.

And those who didn’t?  About 25% of Baby Boomers cite having a pension available to them.  Many will also receive Social Security and maybe have a bit tucked away in their 401k and individual retirement account (IRA) plans.

This isn’t to say all Boomers will live comfortable retirements.  There are many who still need to work to make ends meet because they don’t have enough saved for retirement.

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In the Millennial vs. Baby Boomer retirement debate, the point I am trying to stress is we are being forced to rely more on our own preparation for our own retirement than our predecessors.

We are a generation forced to make its own way in the world- more so than Baby Boomers or Gen-Xers.  It is up to us to seize this challenge and capitalize.

While our story is still being written, it’s clear- because we’re waiting to start saving, we won’t have an easy time.  Compound this further because Millennials have a fear of stocks last seen in those who grew up during the Great Depression.

If we can’t change the hand we’ve been dealt but want a different expected outcome, we need to do something different.  Something unconventional.  We need a new vision for what retirement can be for our generation.

Financial Independence Means Living on Your Own Terms


When I think about retirement, I don’t target some specific age when I know I’ll leave the workforce.

Despite setting aside the maximum in my retirement accounts and knowing how to save money for other priorities, I don’t know if I’ll have a ‘magic day’ where I permanently part with my coworkers and head for the back nine.

And if I’m being honest, that sounds boring.  I don’t find driving a golf cart into the rough looking for an errant ball as the ultimate reward for my life’s work.

Instead, I’d prefer to reduce my stress now by pursuing more projects or work I find rewarding.  Assuming adequate preparation for retirement, I have no intention of punching the clock one last time, strapping on my gold watch, and disengaging for my remaining golden years.

Therefore, I propose Millennials redefine the retirement definition to one which means pursuing financial independence and entrepreneurial activities.  That’s the mission of my site and how I plan to live my life.

If we redefine retirement to mean reaching financial independence, we can challenge conventional wisdom.  We can redefine how to earn, spend, save and invest not only our money, but our time.  Doing so would establish a solid financial foundation from which to live our best lives.

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Along the way, Millennials will need to learn as much as they can about finances and question the accepted wisdom about money, work, and retirement.  For our generation’s new retirement definition, most current advice is incorrect, incomplete, or out-of-date.

Instead, we should create strategies for reaching financial independence.

4 Strategies to Reach Financial Independence as a Millennial


  • Control Our Spending and Learn How to Budget

The easiest dollar earned is the dollar not spent.  Controlling our spending with practical money management skills and financial literacy are the items within our control and are the biggest levers we can pull to increase our saving rate.

  • Learn How to Start Investing Money

Conventional wisdom says to reach a safe retirement by the age of 67 (current age for full Social Security benefits), you should save 15% of your income for 40+ years.  That’s not a bad choice.

15% could get you to those endless rounds of golf.  However, there’s no guarantee Social Security will exist in its current form when we reach our 60s.

If you want to live the life you want, I’d suggest tripling that savings rate.

Perhaps consider starting to invest money in target date funds or other passive index funds, and realizing financial independence won’t happen overnight.

Several free stock apps have made this more accessible than ever (and give free stocks for signing up). However, it is imperative to learn how to live within your means and develop side hustles because this will go a long way.

  • Have Side Hustles and Income Assets to Create Variable Income

We should develop unique, in-demand skill sets and find side hustles which create variable income. Further, we should invest in income-generating assets to diversify our income sources.

Building these side hustles can reduce our dependency on a permanent job and give us freedom to pursue what we want most in life.  Another way to ween off one income is to create passive income streams.

  • Create Passive Income Streams

Passive income is the best type of income because you can earn it while you sleep.  Also, specific types receive the same preferential tax treatment as long-term capital gains.

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The general definition of passive income contains many forms: real estate, dividends, alternative investments options, bonds, etc.

While some passive income has different tax rates, understand not all receive the preferential tax treatment.  However, creating as many various ways to make money without having to play an ongoing, active role in earning it is paramount for financial independence.

To reach financial independence, we should have investments and income streams which produce enough income to cover our cost-of-living and leave room for rises in the cost of living.

If we’re lucky down the road, we can throw in slimmed down Social Security and Medicare benefits for good measure.

Learning to budget, invest in index funds on Robinhood or the best Robinhood alternatives, develop profitable side hustles, and build passive income streams which work for your benefit is the surest path to a secure Millennial retirement.

Financial Independence Means Having No Regrets


I wonder how many current retirees look back in regret about having worked a job they didn’t like for so many years and wished they’d done things differently?  My bet would be a lot.

Life doesn’t often give you mulligans, so I don’t intend to postpone my satisfaction in the hopes of one day reaching a traditional retirement.  I want to pursue financial independence and have the financial freedom to do what I want.

If Millennials are smart, we’ll learn to hustle and save.  This is what many of us will have to do to enjoy a Millennial retirement.  This is also the way to get what we want most of all: living life on our own terms.

Readers: What do you see as a Millennial Retirement? How are you planning to reach it? Please leave your thoughts and comments below as well as please consider subscribing to this blog.

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