early retirement Archives

It’s been over a year now since I reached financial independence at the age of 30, and getting to that point at such a young age is due in large part to choosing to pursue a career in travel physical therapy as a new grad.

Originally when Whitney and I started traveling, I laid out a rough outline and projected it would take me about 5 years of working as a travel PT to reach financial independence. But, surprisingly, I was able to both make more and spend less than I anticipated, which sped things up significantly.

Even though my story and path to FIRE (financially independent retired early) is unique, it didn’t require anything particularly special to be done. I think my journey to financial independence can definitely be replicated by other travel therapists.

The keys to reaching financial independence as a travel therapist were:

living frugally
hustling to make as much money as possible
investing money intelligently

What is Financial Independence Retire Early (FIRE)?

Essentially reaching financial independence is getting to the point at which it’s possible to cover all of your living expenses with only investment returns (or other forms of passive income) indefinitely. At that point, work becomes optional since the income from work is no longer needed to sustain your financial life.

Once financial independence is reached and work becomes optional, many people choose to retire early. I personally have only worked 10 weeks as a physical therapist in the past two years, since I’d rather spend time traveling internationally and working on other interests than to work with patients at this point in my life. It’s not that I never plan on working as a therapist again, it’s just that I no longer have to; and I am choosing to do other things with life right now. I enjoy helping people in a physical therapy capacity, and will likely do some sort of part time work as a PT in the future, but any money earned from it is just icing on the cake at this point.

How do You Determine When You’re Financially Independent?

Most people have no idea how much money they need to reach financial independence and retire. This is a problem because many people, myself included, are motivated by setting and achieving goals. How do you set and strive to reach a goal of retiring when you have no idea how much money is needed?

This is where the 4% rule comes in. The 4% rule is a research-backed method for determining how much money is needed to reach financial independence. Basically, when your invested assets reach a level where you can cover a year’s worth of expenses while withdrawing only 4% of your investment portfolio, you’ve reached financial independence. Even though average equity returns (taking into account the history of the stock market) are in the 8-10% range, there are periods of time when returns can be significantly lower than that, so planning to withdraw 8-10% from your portfolio per year can easily lead to running out of money before you die. At a safer withdrawal rate of 4% per year though, running out of money is very unlikely, assuming that your money is invested wisely.

An easy way to determine how much you’ll need to retire is to use the inverse of the 4% rule, by taking your yearly expenses and multiplying by 25. This is exactly how I figured out what net worth number to shoot for to reach financial independence back in 2015 when I started working toward FIRE.

Traditional financial planning usually involves calculating your retirement number based on your yearly income rather than your yearly expenses. But this just doesn’t really make sense. The true number you need to focus on to figure out your retirement, or financial independence, number, is how much you actually spend each year, and therefore how much money you need to live on for a year. In order to figure this out, you’d need to track your expenses for a few months or a whole year to get a good estimate of how much you actually spend in a year.

Since your financial independence goal number is determined by expenses, reducing monthly/yearly expenses is the easiest way to reduce the amount of time to get there. This makes your savings rate vital!

Why Strive to Achieve Financial Independence?

Everyone has their own reasons for trying to reach financial independence. It could be to spend more time with family, to take long trips overseas, to spend more time working on hobbies, as well as a variety of other reasons. For me the biggest reason was to have as many options as possible. Reaching financial independence meant that I can now pursue whatever it is that piques my interest at any given time. I’ve found over time that my interests change often, and having as much time as I want to pursue new interests when they arise is huge for me.

Why is Reaching Financial Independence Easier as a Travel Therapist?

There are several reasons why I believe that reaching financial independence is easier as a travel therapist compared to therapists working permanent jobs. All of the factors below directly contributed to my success in reaching financial independence so quickly:

Higher income:
- This is the most obvious reason and the reason why many therapists choose to travel in the first place. Most travel therapists can expect to earn between 1.5-2 times as much money after taxes compared to a therapist working a permanent job. The more money a therapist is able to make, the more they’re able to save to reach financial independence more quickly.
Becoming a minimalist:
- As a travel therapist, getting used to living with less is important. Packing and moving is always difficult, but it gets more difficult the more stuff you take with you to each assignment. Whitney and I both progressively became more minimalist the more travel assignments we took in order to avoid having to pack and move as much stuff, and this seems to be an almost unanimous trait among other travelers as well. Learning to be a minimalist is important in reaching financial independence because the less you buy, the lower your expenses, and the faster your path to FIRE.
Lower student loan payments:
- I’ve written numerous articles on student loans including all the various student loan forgiveness options over the years. As a travel therapist on an income driven repayment plan, it’s possible to reduce your student loan payment significantly and even to pay $0/month in some cases. Going on the REPAYE repayment plan and pursuing student loan forgiveness while saving and investing as much as possible has allowed me to have a significantly higher net worth even when factoring in my student loan balance gradually growing. This isn’t the solution for everyone but is definitely worth considering, especially as a travel therapist with lower taxable income.
  - For those therapists who would rather pay off their student loans as quickly as possible, point #1 about higher income can help you to aggressively pay off your student loans within just a couple years as a travel therapist, compared with stretching it out over 10+ years on a standard repayment.
Cheaper health insurance:
- Currently under the Affordable Care Act, subsidies can make health insurance extremely affordable for those with a low taxable income. I’ve been able to take advantage of this for the past couple of years with, health insurance costing me less than $150/month while using the ACA marketplace plans between contracts. While on contract I’ve always chosen to use company sponsored plans which have always been very affordable. For most Americans, health insurance costs are a major concern, but as a travel therapist with a lower adjusted gross income (AGI), health insurance can be very affordable!

Using Travel Therapy to Gain Freedom

Financial independence is a goal that everyone should be striving for regardless if retiring early is appealing or not. Even if you love your job and plan to never quit working, having the peace of mind of knowing that work is optional is invaluable. Having more options in your life is always a wonderful thing!

Pursuing a career as a travel therapist, with all of the flexibility and benefits inherent in the job, is a perfect way to reach financial independence more quickly. Travel therapy was certainly vital for me in reaching my financial goals in such a short period of time!

If you’d like help getting started on your own path to financial independence and travel therapy journey, feel free to contact us with questions or ask us for recommendations for travel therapy companies/recruiters to help you get started!

Written by Jared Casazza, PT, DPT

Written by Travis Kemper, PT, DPT

What is your dream vacation or retirement? For most of our country, it seems the goal of working is to retire, and retirement means an endless vacation doing whatever we want. Julia and I took an eye-opening vacation recently while on break between our Travel Physical Therapy positions in New Mexico and Arizona. We went to Hawaii, more specifically Maui and Oahu, for nearly three weeks to relax, hike, swim, surf, snorkel, etc. — as well as see some friends that are living there.

This seemed like an ideal vacation, and it was for about 10 days, but then something unexpected happened. Even with being active throughout the days in the water and hiking, we both found ourselves with achy bodies. More importantly, we found ourselves unfulfilled in an amazing destination; we felt as though we didn’t have a purpose.

We concluded that for us, all future extended vacations will need to be a combination of “voluntourism” and exploration to allow us to have a purpose, help people, and see beautiful parts of the world. This is something we both knew we would want to do in the future anyway, but we were both surprised to find that it will be necessary for our vacations to be fulfilling. We realized, that while we are still going to pursue financial independence so that we don’t need to punch the time clock in the future, we will likely never truly retire.

One great thing for us is that we have found a profession that allows us job flexibility, so that we may never have to truly “retire,” and that is Travel Physical Therapy. This has allowed us the opportunity to still work and feel as though we have a purpose, while getting to travel around to different parts of the country and go on endless adventures. Additionally, we have the opportunity to take time off whenever we want to or feel like we need a change, such as a week to a few weeks between contracts to explore a new area, go on a volunteer trip, or rest and recharge.

We are very fortunate to have this as a career option, so we don’t see ourselves with the urge to “retire” anytime soon, despite the fact we are saving and working toward financial independence.

In my opinion, travel therapy gives us the perfect work-life balance. I feel that a life of endless vacation would be unfulfilling; but a life where I have many options to work, not work, volunteer, take time off, travel, vacation— whatever I want, that’s a great life.

What’s your take on this? Do you think endless vacation would be great, or not? Where does travel therapy come into play for you? Let us know!