46-Year-Old Who Retired After Doing 'Average Joe' Jobs Shares Stock Portfolio, Tips – Says Stock Market Your Second 'Dearest Friend'

Rising inflation and economic uncertainty make it difficult for many Americans to plan their retirement. A national survey last year showed 55% of Gen X feel they won't be financially prepared for retirement, compared with 48% of Boomers and 46% of millennials.

Not everyone can get those coveted $300k-$400k tech jobs and forge an easy path to early retirement. But is it possible for people with average-paying jobs to retire early and live comfortably?

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In July, someone shared their retirement story on r/financialindependence, a community of 2.3 million members interested in financial independence. The Redditor said he worked "uninteresting" and "average Joe" jobs in the tech industry for 20 years, where his average salary was about $100,000 before tax. 

‘No FAANGs'

And yet he, 46, retired early a year ago and lives in India with his two kids and a stay-at-home spouse.

"No FAANGs … no top tech companies. Even though I had a relevant academic CS background, I wasn’t good enough to get into any top place. Grudgingly accepted my averageness and worked on normal maintenance projects in boring companies."

Investing Is ‘The Greatest Tool For The Average'

Before discussing how he managed to pull off this impressive feat, let's take a look at the key takeaway according to the investor that could help the average Joe plan an early exit from the workforce:

"Investing in the market is the greatest tool for the average! I suck at picking stocks and whenever I did, I incurred losses. Read, reread and read it every year – “The Little Book of Common Sense Investing.” Once I put my investments on “cruise” mode, it simplified my financial life/growth greatly."

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Total Net Worth Picture

Here is the net worth of the investor based on the details he provided:

Equity investments: $1.3M

Fully paid home: $600K (rented out since FIRE’d abroad)

401(k) balance: $1.3M (all in broader market ETFs)

The investor said he was raking in about $25,000 in rent annually from his house in the US.

$1,000 Per Month for 401(k) Over 20 Years

The 46-year-old investor, who moved from the U.S. to India for retirement, said he stashed away $1,000 for his 401(k) every month to invest in the stock market for 20 years.

"That’s roughly a quarter of a million invested over 20 years!"

‘Market Is Your Next Dearest Friend'

He urged investors to always think long-term and consider the market as "next dearest friend" after time.

"For the avg Joe, the market is your next dearest friend. There is no one else who will diligently work for you. Invest your 401(k) in any of the broad market/index ETFs."

Drove The Same Car for 20 Years

Like most successful investors, the 46-year-old who retired early said he always lived below his means to save and invest. He said he drove his Honda Civic for 20 years and only bought a new car when he could easily afford it.

"Lived a frugal life – spend less, save more. Did not tour the world … heck, did not even tour the US. I was mostly content with small trips in and around where I lived. Growing up in a lower middle-class family, I continued living that way after I found myself a job."

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The investor named a few funds he was invested in. Let's discuss them.

The Invesco QQQ Trust Series 1

The Invesco QQQ Trust, Series 1 QQQ, was one of the funds in the portfolio of the 46-year-old investor. He said he firmly believed the fund was one of the best ways to increase long-term wealth. He even made a table showing how small contributions to the fund would have given investors long-term gains.

"Do some simple math. If you had invested $10K in 2004 (in QQQ) and let it compound over time you’d be worth $152,400 today. Similarly, a $10K in 2005 is worth $137,000 today. Do that for each of the years in the table with an investment of $12K and you’d realize that I grossly underperformed. Nothing wrong, just pointing out how you are looking at the entire math wrong on this."

The ETF exposes investors to some of the top tech stocks in the NASDAQ-100 index. 

Vanguard Total Stock Market Index Fund ETF

The 46-year-old American investor, who retired in India with his family, said Vanguard Total Stock Market Index Fund ETF Shares (VTI) was a part of his portfolio. 

Vanguard Total Stock Market Index Fund ETF Shares (VTI) tracks the total stock market, exposing investors to small-, mid- and large-cap stocks. About 69% of the fund is allocated to large-cap stocks. Its portfolio includes more than 3,600 stocks. Among the top holdings of the ETF are Apple, Microsoft, Nvidia, Meta Platforms and Amazon.

Vanguard S&P 500 ETF

Vanguard S&P 500 ETF VOO is another broader market ETF that was part of the investor’s portfolio, who had $1.3 million in equity investments in broader market ETFs via his 401(k). The fund invests in the S&P 500 Index.

Wondering if your investments can get you to a $5,000,000 nest egg? Speak to a financial advisor today. SmartAsset’s free tool matches you up with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.

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