Dave Ramsey is an often polarizing figure in financial circles. He has a massive following of supporters, but there are also those who view his advice as wrong or too simplistic. Regardless of your opinion, he offers three key things to model if you would like to retire early.

Here they are:

  1. Find out what you want to do with your life. In other words, find your purpose. It is important to consider what you are retiring to, not just what you are retiring from. Ultimately you need to know the “why” to your existence, because that will drive and motivate your career success as well as a meaningful retirement.
  2. Invest in Roth IRAs and 401(k)s for the longer term. Dave Ramsey suggesting investing in these vehicles while also working a full-time job and pulling down an income, but this needs to be done consistently and for decades.
  3. Invest in low-turnover mutual funds. These are growth-type funds where the stocks are not sold very often, resulting in low portfolio turnover which minimizes the taxation of the portfolio.

In the short list above, the first step is the most important, because from it all things flow. But purpose only matters if there is a financial plan in place to drive it, so be sure to work all three steps, but never lose sight of the first one.