It is hard enough building yourself up from nothing, but having to do so twice can be soul-crushing. You think you’re on your way to a secure retirement, only to find yourself back at the beginning and needing to start over. Still, it is possible to pick yourself up and dust yourself off. Disappointment shouldn’t lead to giving up, especially if you’re young.

That’s the initial reaction I had to this Redditor’s post on the subreddit r/ChubbyFIRE, a board dedicated to financial independence and early retirement while still enjoying the good things in life.

DrChilliPepper wrote that as a small business owner, he found himself at age 29 with his services in a high-demand industry giving him a net worth of $200,000. He felt he had arrived at a point where he could splurge, which, of course, is when it all came undone.

He made some poor cryptocurrency investments, followed by his business being flooded with competition. Suddenly he was back at square one. While he has managed to get himself out of debt, he’s now 32 years old and living with his parents once more. After cutting the majority of his expenses, he has $25,000 to his name again.

Although he has a goal of making $150,000 this year with an eye towards saving half of it after taxes, he feels if he doesn’t achieve this he will simply give up being an entrepreneur and work any job he can find.

The raging defeatism in his post is palpable. He was on his way up, only to crash and burn. What he wants to know is, is it possible to get back on track and start all over again?

24/7 Wall St. Insights:

• When you find yourself suffering a major setback on your road to a financially secure retirement, you can’t allow yourself the luxury of self-pity. You need to dust yourself off and get going once more.
• Particularly if you are young, you can use the power of time and compound interest to achieve the security you seek.
• No matter what age you are, the keys to success include committing to living below your means, staying out of debt at all costs, and making sustained, regular investments into the stock market. 

A plain vanilla option may be best

Because DrChilliPepper is relatively young and can readily work for another 20 to 30 years, he has time on his side. If he did nothing more than buy an S&P 500 index fund with his $25,000 grubstake and held onto it for 30 years, even if he never added another dime, he would have about half a million dollars at retirement. That assumes the benchmark index continues to earn its historical average of 10.5% annually.

While that might not be enough to live a life of leisure and wealth, it’s not nothing either. But if he made regular monthly contributions of $500 over that time, DrChilliPepper could have over $1.8 million at the end. Time and compound interest are a powerful combination that can set you up for an easy retirement.

3 essential keys for success

No matter when you start, though, whether in your 20s, 30s, 40s, or even 50s, just starting and keeping at it is the essential ingredient to success. Of course, the older you are the more you have to do to achieve your goals. 

That’s why you should start investing for your retirement as early as possible. It allows you to make mistakes, learn from them, and move on. Later in life, you have less room for error. You may have to forego many luxuries you are accustomed to and contribute more than you would in your 20s, but it is still possible to come out ahead in the end.

The Redditor certainly seems to have the mindset and drive to overcome his mistakes. That can be just as important as having the financial means to achieve the goals. The saying “where there is will, there is a way” happens to be very true because you make your own luck rather than wallowing in self-pity.

Overcoming your inner demons is the first step. Then you must live below your means, avoid debt like the plague, and invest in the stock market with an eye towards the future.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.