The Big Four Oh


They say “You can’t see the forest for the trees.” In other words, it can be easy to lose sight of your goals while focusing on the tactics. For us dividend growth investors, and most other investors for that matter, we do what we do as a means to an end. Financial independence (FI) and/or early retirement (ER) are the primary goals for all our research and hard work. It can be easy to forget that while diving into earnings reports and dividend history. This is why it’s important to set a clearly defined goal.

A common goal across the investment blog community is to achieve FI/ER by the age of 40. But what makes 40 so special? I asked some of the people who inspire me to share their thoughts.

Joe at, who is already enjoying early retirement, said “I think 40 feels like the mid point in our lives. If you’re not happy with your life by then, you need to make a change.” Many of us spend the majority of our time working at jobs we don’t love to cover the costs of living. We only have so much time on this planet to enjoy, so if there’s a way to enjoy it more, why not pursue it? Joe saved everything he could to invest in a number of different strategies including dividend investing, Peer-to-Peer (P2P) lending, and real estate. In July 2013, these investments empowered Joe to leave his corporate job and live life on his terms before he even actually turned 40.

Achieving that freedom while you can still enjoy it is important too. Jason Fieber at says “I think 40 is a popular age because it’s young enough to still live life to its fullest, while also being old enough to be experienced enough to know exactly what you want out of life.” This is why setting a goal early and working towards it is so important. “… if you start working at 22, and retire at 40 you’ve got 18 years to build a large enough portfolio to live off of.” Jason’s journey began in 2010, 2 months before his 28th birthday. His plan: “to save more than half of my net income for the entire 12-year period and invest in high quality companies that pay rising dividends at attractive valuations.” So far he has built a portfolio valued at almost $150k, which many consider to be “Critical Mass.”

Setting the goal is important, but knowing what you want to do with that freedom is important as well. Tim at invests to have the freedom to never be stuck in a job he hates and to give back to society. His goal would be better defined as financial independence rather than early retirement. In Tim’s eyes, “Financial independence lets you become more philosophical and focus relentlessly on personal happiness and benefiting society without getting caught up in the rigmarole of the paycheck-to-paycheck lifestyle.”

40 is such a popular target age because you’re young enough to still enjoy the money. What good would all of your hard work and saving be if you were too old to enjoy it? You always hear retired people say “youth is wasted on the young” but what they really mean is “I wish I knew what I know now when I was younger.” This is why the best time to start saving money and investing is NOW. Set a goal for yourself, and be clear how you want to achieve it. What age do you want to retire by? How much money will you need? How much do you need to save each month to achieve that? Once you have your plan, start acting on it. For me, this means buying dividend paying stocks that raise their distributions each year like MCD and TGT.

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