As a software developer have you ever stopped and thought about how things will map out for you over the coming years? Have you ever wondered if you’ll be able to retire early and what it would take to be able to do that?
Let’s say you looked just 10 years ahead. You continue to work as a software developer in a corporate job, or even as a freelancer. How will your life look in 10 years’ time?
As an example of how things might transpire, let’s look at the case of a developer who’s earning a high-end salary in excess of $100k and up to $150k. Over the next 10 years, they might expect to earn about $1.5m. But they will have created zero wealth for themselves, even though they’re earning a top salary.
The salary they earned will have been spent supporting their lifestyle. They’ll be 10 years older, maybe late 40s or early 50s, but they won’t have any accumulated wealth. If they’re lucky they might have a small company pension. If they’ve been “smart” they might have been making their own contributions to a pension scheme. But the chances of retiring early while maintaining their existing lifestyle will be a receding dream.
Alternatively, let’s look at a developer who starts their own business at age 40. 10 years later, by the time they’ve hit age 50, with a modicum of success, they could have generated total revenues in excess of $15m and quite possibly much more.
Apart from paying themselves a good salary, they’ll also have taken profits/dividends and begun to accumulate wealth. They’ll likely have made large lump-sum contributions to a retirement fund and started building a nest-egg. They may also upgrade their house and car and take more expensive holidays.
But most importantly they will have built a valuable asset. They will be able to realistically look at cashing out and retiring early.
On top of that, they will have learned a whole new set of skills. Skills that will stay with them for the rest of their life and that will likely lead to them becoming a serial entrepreneur. With these skills, they will never have to worry about unemployment or age discrimination again. They know that they can always choose their own future by starting another business and accumulating more wealth.
So, is it possible to retire early as a software developer? Absolutely. But it might require you to make some life-changing decisions now to enable it to happen.
One of the reasons most people, not just software developers, won’t be able to retire early is that they make no conscious decision about how their life will play out. They just operate on autopilot and life just passes them by.
The vast majority of people appear to be happy to help other people accumulate wealth while they live from paycheck to paycheck and have little prospect of early retirement.
None of us can change the past. That’s history. But we can all change our future by making some key decisions about how we’d like our life to play out.
If you’re not happy with the way things are heading then don’t get 10 years down the road and regret that you didn’t follow a different path. Don’t blame circumstances, the economy, lack of money, lack of education, etc.
You are not the product of your circumstances. You are the product of your decisions. The worst decision is no decision. This is what many people default to.
Don’t be one of them.
I was very nearly one of these people. I got to my 40th birthday and was in cruise mode. I had a good job, a good salary, a company car, nice holidays but I wasn’t providing for my future. I only had a very small pension and I could see that there was no chance of retiring early if my life continued on the same trajectory. And I certainly wouldn’t be able to have the sort of lifestyle I wanted for my retirement.
I kept talking about having my own business but I kept avoiding making a decision. I knew that having my own business was a much surer way of achieving financial freedom and setting up the type of future life I aspired to. Thankfully, my 40th birthday acted as a metaphorical kick-in-the-butt as it jolted me out of cruise mode and woke me up to realize that I had to stop procrastinating and get on with starting my own business. Within 6 months I was up and running and the rest, as they say, is history.
So if you’d like to retire early with a lifestyle similar, or better, to your current one then you need to start accumulating wealth. And the best way that I know to do that is to start your own business.