Rachel Richards was able to retire at age 28. His secret? She learned to manage her money to generate passive income, allowing her to live off her pensions. She reveals all her tips to help you follow her path.
It is important to start saving very early to deal with the problems you may encounter throughout life, but also to benefit from a good retirement. Rachel Richards went further since she was able to retire at the age of 28, generating passive income to the tune of $16,000 per month. CNBC Make It shares the young woman’s secrets to saving and managing her money.
Rachel’s journey, a graduate of Center College in Danville (USA), began well before she entered university. In fact, the young woman was scared at the idea of having to repay a student loan. His academic and sporting results during his schooling allowed him to obtain several scholarships to avoid having to pay for his studies. With one less student loan on her hands, Rachel was able to save to retire before she turned 30.
1 – Set aside half of your salary
Rachel’s first secret that allowed her to retire at 28 was keeping half her salary. She explains that she started with a salary of $35,000 per year, or approximately €34,200, remuneration which jumped to $42,000 the second year, or $3,500 per month. However, it is not necessarily relevant to compare Rachel’s salary with those that can be found in France, since certain important expenses are not included in these remunerations: social security contributions, retirement, etc.
Even though her rent cost her $1,500 per month, Rachel managed to put aside half of her salary by paying close attention to her expenses. She also knew how to give her all to her work and accumulate in-depth knowledge about her profession as a financial advisor. This allowed him to quickly find another job that paid even better.
2 – Set up a passive income system
Rachel’s second tip was to set up an entire passive income system. The young woman therefore turned to real estate in 2017. With her fiancé, she decided to buy a duplex in Louiseville for $100,000. Each of the two members of the couple put $10,000 on the table and supplemented it with a loan of $80,000.
With the rent generated by the first purchase, Rachel and her fiancé decided to acquire new properties. In total, they bought six more in two years, which represents 40 rental homes. The young retiree explains that she took a license to become a real estate agent, which allowed her to be aware, before anyone else, of the different offers on the market. Additionally, this allowed him to act as a real estate agent and earn commission on his own purchases.
When purchasing real estate, the couple looked for apartments where there was no work to be done or those that already had tenants. Rachel Richards was looking at apartments that could charge up to $300 a month in rent.
3 – Transform your passion into passive income
Once she made her first acquisition, Rachel understood that she could put her know-how to good use. Her family and friends regularly asked her for advice on how to better manage their money, and the young woman therefore decided to write a book on personal finances.
She then decided to publish it on her own, directly on Amazon. This technique allowed her to receive 35% to 70% of the revenue linked to the sales of her book on personal finances, compared to 10% to 15% if she had gone through a traditional American publishing house. She also took the opportunity to create an online course, “ Get Your Financial $hit Together » which stems from his book and allows him to earn almost $4,000 per month.
Rachel’s daily life, after her retirement at 28
Today, Rachel and her fiancé earn $16,000 per month, together, just in passive income. Their daily life is nevertheless punctuated by the management of their accommodation. Her fiancé decided to keep his job in the army, which allows the couple to benefit from health protection.
Rachel testifies explaining that today she works “ when, where and if [elle] seen[t] “. She also says she lives with passion, which is that of a woman who writes books and teaches about personal finance.
