A couple who retired in their 40s says there are 3 types of spenders, and the key to building real wealth depends on which one you are

A couple who retired in their 40s says there are 3 types of spenders, and the key to building real wealth depends on which one you are

Kiersten and Julien Saunders, a couple who retired in their 40s, say there are three types of spenders.
Fast spenders can’t hold onto their cash, while financially insecure people worry about spending money.
Most people are in the middle, but they still might be too scared to pursue financial independence.
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There’s tons of advice online about building wealth and retiring early, but it’s hard to know which approach works best for your specific circumstances.

Kiersten and Julien Saunders, a couple who retired in their 40s and host the popular podcast rich & REGULAR, suggest finding out what kind of spender you are before creating your wealth-building plan.

In their new book, “Cashing Out: Win the Wealth Game by Walking Away,” the couple explains that there are three different types of spenders.

Are you financially insecure, a fast spender, or somewhere in the middle?
The financially insecure: These are people who have experienced financial hardship in the past, who now live paycheck to paycheck. The Saunderses write, “They’ve grown accustomed to this way of life, and their goal is simple: to have enough.”
The fast spenders: Fast spenders tend to be high earners who spend money extravagantly and quickly. “They get an all-encompassing, full-spirited rush from spending money, and the desire to do it over and over sets the tone for their lives,” they write

The financially insecure are more likely to equate their self-worth with their ability to perform well at work. They are always striving for higher-paying jobs, living paycheck to paycheck, and struggling to feel like they have enough.

To counteract the impulse to keep grinding hard at a 9-to-5 job, the Saunderses remind their readers that a salary is never going to outperform investing in the stock market.

The couple writes, “You must believe your income can work harder than you can. Instead of working for your money, you must adjust to managing your money so that it can multiply over time to serve your future wants and needs.”

For the fast spenders: Track your income
Of fast spenders, the couple writes, “Money both comes in and goes out at such a fast pace there’s no time to build an emotional attachment to it and little incentive to try tracking it.”

The couple writes about a friend of theirs who would rather go out for expensive drinks and indulge in luxury vacations instead of funding his retirement. “Plus, he believes that if he wanted to, he could start saving money tomorrow. The problem is, tomorrow never comes.”

The book contains “richuals,” simple guidelines that help readers change their relationship with money. A good “richual” for fast spenders is to track your income and how you feel when you earn that money. The couple writes, “A dollar earned doing something you enjoy is always better than a dollar earned doing something you don’t.”

Retirement Calculator Use Insider’s calculator to see if you’re on your way to a comfortable retirement by answering a few questions about yourself, your savings, and how long you expect to keep working.
You will have about

$1,725,000

You will need about

$2,940,000

*Need is based on covering 70% of your annual pre-retirement income and a life expectancy of 100 Years.

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