Teenagers blithely skip off to uncertain futures, while their parents sit weeping curbside in the Volvo, because the adolescent brain isn’t yet formed enough to recognize and evaluate risk.
— Michael J. Fox

Over Christmas this past year I went down to Los Angeles to visit my best friend and his family. As a Christmas present to my two godkids, my wife and I took them to Disneyland. (Of course it was a gift to ourselves, as well.)

The rides and attractions were fun as always, but honestly I think I enjoyed our time standing in line even more — it was our chance to talk and catch up on anything and everything. I hadn’t seen the kids in far too long, and they had grown up to become wonderful, intelligent, fun, and polite teenagers. (Yes! Such a thing exists!)

As I mentioned, their dad is my best friend and my favorite human being in the world. I can’t even begin to express my admiration for him and his wife for being such fantastic parents, and raising such great kids in an age of unfettered narcissism. It gives me a tiny glimmer of hope for the future.

No one’s good at everything, though — and handling money has never been his greatest strength. Mine is not to judge, of course — I was no champion at it, either, for much of my life. I’ve pulled back the curtain and learned many truths in recent years, though (the hard way, regrettably, but better the hard way than no way at all). So when the inevitable topic of college and future careers came up, and both kids announced their intentions to “get rich,” my ears pricked up.

The Revelation

“In my mind being rich isn’t about things; it’s about time — being able to choose how, where, and with whom you spend it,” I said.

The kids both agree with this sentiment. My godson even said, “That’s true. It would be great to have enough money so you wouldn’t have to work. I’d still keep working, though.” That put a smile on my face.

“Sure, of course you would,” I said. “But wouldn’t it be great to know you could leave any time you wanted if you stopped enjoying your job?”

They agreed, naturally.

“Well let me tell you something. Listen up, now, because if I could have one wish, it would be to go back in time and have someone tell me what I’m about to tell you when I was your age.”

They listened. Yes, not only are they intelligent, fun, and polite, but they actually know how to listen. And they’re teenagers. Amazing. I don’t have kids of my own yet, but my wife and I plan to, and when we do, I hope I’m half the father my friend is.

“You could easily have enough money to retire on when you’re younger than your dad is right now,” I said. “All you have to do is follow one simple rule.”

“No way!” said my goddaughter.

“Yep,” I said. “All you have to do is save 75% of what you earn. Do that, and you’ll have enough to quit working in about 7 or 8 years. You could be done before you hit 30.”

“What! How!”

“Well, you see, if you save 75%, you bank 3 years’ worth of living expenses every year. So in 8 years, you’ll have saved up 24 years worth of expenses. The conventional wisdom is that you can spend about 4% of your money per year without much risk of going broke if you invest reasonably, so you’d pretty much be financially independent by then.”

Their eyes sparkled. “I’m totally going to do that,” my godson said.

The conversation drifted back, eventually, to stories about their dad and me when we were teenagers ourselves. We all laughed until we cried, more than once. But every now and then throughout the rest of the day, we’d chat just a little more about reaching financial freedom at a young age, and I’d catch a faraway look on one or the other of their faces.