How To Go From Living Paycheck to Paycheck to Retiring Early, According to Dr. Lakisha Simmons
The Financially Savvy Female had the opportunity to chat with Dr. Lakisha Simmons, a financial freedom coach who went from living paycheck to paycheck to saving $750,000 in four years and becoming financially independent. Here, we chat with Simmons about how she achieved this financial milestone and how other women can too.
Listen: Live Richer Podcast, Episode 7: F.I.R.E. Movement Expert Dr. Lakisha Simmons Gives Tips on How To Retire On Your Own Terms
Women and Money: The Complete Guide To Being a Financially Savvy Female
What steps did you take to become financially independent and able to retire early?
I took four steps to reach financial independence and retire early from full-time work. The first was the most important, and that is believing that I was worthy of being wealthy. I didn’t always feel that way, but I knew if my goal was to reach $1.25 million, I would have to believe I was worthy of having that. After that, the next actions became easy.
Second, I got a budget bestie: a spreadsheet with rows for every income and every expense I had, and columns for each pay period of the year and formulas that compute balances automatically. I was then able to cut expenses that didn’t align with my values and my mission to retire early.
Third, I learned all about retirement accounts — how they work, the IRS limits and how they reduce taxes, and started increasing my contributions.
Fourth, I learned how the stock market works and began trading in my own investment account to make my money finally start working for me. My money began to multiply.
Of all the things you did to be able to retire early, which had the most impact?
When I changed my mindset from spending to saving to investing, everything changed for me. I shifted from fear to confidence with investing because I took time to educate myself and create my own financial freedom plan (when and how much I needed to retire early). Within four years of taking these steps, I had accumulated $750,000 in investments due to the power of compound interest. Even after I retired early and stopped investing in June 2021, my investment nest egg had increased by another $70,000 by November 2021.
What advice would you give to other women who want to achieve financial independence?
My best advice for those who want to become financially free is to make it your main focus. Educate yourself, put energy toward creating your own financial plan and start investing!
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Jaime Catmull contributed to the reporting for this article.