Last Updated on June 5, 2021 at 9:14 am
Raghu asks, “Dear Pattu Sir, I have just started my career as a school teacher in a tier II city. I also take tuitions to supplement my income. Thanks to our families frugal existences and early initiation into personal finance, I have been able to comfortably make ends meet and invest the rest (thanks to your articles!). I am fascinated by financial freedom and wish to achieve it at least before the age of 50.”
“However, except perhaps your story, every financial freedom story I have read is that of an IT employee often with some time spent abroad. Is financial freedom an impossible dream for those working in non-IT jobs?”
Let us begin by making necessary clarifications to appease readers from the IT industry who are possibly fuming at the insinuation that it is easier for them to become financially free. While it is true that some instances of financial freedom (including accounts shared here) are those from IT folk, it is not a universal trend. What Raghu is trying to say is, “is there any hope of financial freedom if my salary is low?”
Now, let us not interpret this as “IT folk earn a lot”. Raghu is under the impression that a school teacher in a tier II city may not make as much as an entry-level employee TCS or Infy. However, I recently learned that the entry-level IT pay has not changed much for many years. So the “gap” may not be as high as Raghu imagines.
Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email! 🔥Enjoy massive discounts on our robo-advisory tool & courses! 🔥
Also, even as an outsider, I could see that the nature of the IT business has changed. Many who started in the early/mid-90s have probably achieved financial independence and become independent consultants or entrepreneurs. Correct me if I am wrong, but the going has been at least a little tougher for those who started in the early 2000s and tougher for those who started later.
And as regards that envious on-site opportunity, it had dried up even before the pandemic and, at the very least, looks uncertain now. So let us not single out IT employees as these super-rich guys who can easily become financial independent.
At least in the higher echelons of academia, the income gap has significantly reduced if not overturned. Ok, that is enough appeasement. Let us get down to the question at hand.
Forget early retirement. For even normal retirement with financial freedom, one requires a reasonable salary, low expenses, not too much debt and the prospects of salary hikes in future. Where one works is irrelevant.
Also, the definition of normal retirement has considerably changed. For me, it is age 65. For school teachers, it should be age 60. The scenario for those with corporate jobs is considerably different. Even in the non-IT sector, normal retirement is probably 55 or even 50 (if not less!).
For someone below age 30, for normal retirement with financial freedom, if X = annual expenses that will persist in retirement (to be reviewed each year), X should be the minimum annual investment. They should invest in a portfolio with an initial equity allocation of at least 50-60%.
If Raghu can pull this off from day one or at least within the next 3-5 years, he should consider himself on the right path. But, unfortunately, scores of 30+ and 40+ Indians find this impossible to pull off. Raghu could well be one of them. The way out does not lie in worrying about what others make.
For early retirement – let us define this as at least 10 years before normal retirement for a person’s job profile -the annual investment should be two-three times more. If Raghu lives a frugal life and keeps his expenses and debt low, strives to increase his income; early retirement is a real possibility.
It is important not to jump to conclusions about our life and future net worth based on what we earn today. Things can change quite rapidly, provided we have the desire and discipline to take action.
So dear Raghu, do not be envious of IT folk. They have a ton of problems to deal with. A teacher typically does not deal with the kind of stress that comes with a fat corporate salary. Use that advantage to make the best use of your time. Upskill yourself, share your learnings with others and build your income.
The desire for financial freedom or early retirement is often a dream that originates from a stressful workplace. However, at least for someone with Raghu’s profile, I think it is possible to find a work-life balance without becoming financially free as soon as possible.
Never define success in terms of salary or education or belongings even success! “Success is really nothing more than the progressive realization of a worthy ideal.” – Earl Nightingale.
So I would worry about what is a worthy ideal for me and set about getting closer to it. Determination is the key. All the best.
🔥Enjoy massive discounts on our courses, robo-advisory tool and exclusive investor circle! 🔥& join our community of 5000+ users!
Use our Robo-advisory Tool for a start-to-finish financial plan! ⇐ More than 1,000 investors and advisors use this!
New Tool! => Track your mutual funds and stock investments with this Google Sheet!
We also publish monthly equity mutual funds, debt and hybrid mutual funds, index funds and ETF screeners and momentum, low-volatility stock screeners.
![Follow Freefincal on Google News Follow Freefincal on Google News](https://freefincal.com/wp-content/uploads/2023/07/Follow-Freefincal-on-Google-News.jpg)
![Subscribe to the freefincal Youtube Channel Subscribe to the freefincal Youtube Channel. Subscribe button courtesy: Vecteezy.](https://freefincal.com/wp-content/uploads/2023/07/Subscribe-to-the-freefincal-Youtube-Channel.jpg)
![Follow freefincal on WhatsApp Channel Follow freefincal on WhatsApp Channel](https://freefincal.com/wp-content/uploads/2023/09/Follow-freefincal-on-WhatsApp-Channel-300x83.jpg)
![Listen to the Lets Get Rich with Pattu Podcast Listen to the Lets Get Rich with Pattu Podcast](https://freefincal.com/wp-content/uploads/2023/07/Listen-to-the-Lets-Get-Rich-with-Pattu-Podcast.jpg)
![Lets Get RICH With PATTU podcast on YouTube Lets Get RICH With PATTU podcast on YouTube](https://freefincal.com/wp-content/uploads/2023/08/Lets-Get-RICH-With-PATTU-podcast-on-YouTube-644x362.jpg)
- Do you have a comment about the above article? Reach out to us on Twitter: @freefincal or @pattufreefincal
- Have a question? Subscribe to our newsletter using the form below.
- Hit 'reply' to any email from us! We do not offer personalized investment advice. We can write a detailed article without mentioning your name if you have a generic question.
Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email!
About The Author
![Pattabiraman editor freefincal](https://freefincal.com/wp-content/uploads/2019/11/Pattabiraman-author-freefincal-article-bottom.jpg)
Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! ⇐ More than 3,000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter the market condition is!! Watch the first lecture for free! One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Our new course! Increase your income by getting people to pay for your skills! ⇐ More than 700 salaried employees, entrepreneurs and financial advisors are part of our exclusive community! Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show you how to achieve this by showcasing your skills and building a community that trusts and pays you! (watch 1st lecture for free). One-time payment! No recurring fees! Life-long access to videos!
Our new book for kids: “Chinchu Gets a Superpower!” is now available!
![Both boy and girl version covers of Chinchu gets a superpower](https://freefincal.com/wp-content/uploads/2021/02/Article-bottom-Chinchu-gets-a-superpower-front-cover-for-girls-and-boys.jpg)
![Feedback from a young reader after reading Chinchu gets a Superpower (small version)](https://freefincal.com/wp-content/uploads/2021/02/For-bottom-Feedback-from-a-young-reader-after-reading-Chinchu-gets-a-superpower.jpg)
Must-read book even for adults! This is something that every parent should teach their kids right from their young age. The importance of money management and decision making based on their wants and needs. Very nicely written in simple terms. - Arun.Buy the book: Chinchu gets a superpower for your child!
How to profit from content writing: Our new ebook is for those interested in getting side income via content writing. It is available at a 50% discount for Rs. 500 only!
Do you want to check if the market is overvalued or undervalued? Use our market valuation tool (it will work with any index!), or get the Tactical Buy/Sell timing tool!
We publish monthly mutual fund screeners and momentum, low-volatility stock screeners.
About freefincal & its content policy. Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on mutual funds, stocks, investing, retirement and personal finance developments. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than three million readers a year (5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified with credible and knowledgeable sources before publication. Freefincal does not publish paid articles, promotions, PR, satire or opinions without data. All opinions will be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
- Twitter @freefincal
- Subscribe to our YouTube Videos
- Posts feed via Feedburner.
Our publications
You Can Be Rich Too with Goal-Based Investing
![You can be rich too with goal based investing](https://freefincal.com/wp-content/uploads/2016/11/You-can-be-rich-243x300.jpg)
Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want
![Gamechanger: Forget Start-ups, Join Corporate and Still Live the Rich Life you want](https://freefincal.com/wp-content/uploads/2017/05/2-mini-Cover-pink.jpg)
Your Ultimate Guide to Travel
![Travel-Training-Kit-Cover-new](https://freefincal.com/wp-content/uploads/2019/11/Travel-Training-Kit-Cover-new.jpg)