Book Review: Early Retirement Extreme (by Jacob Lund Fisker)

For those unaware, Jacob Lund Fisker is one of the most popular (FIER) Financial Independence and Early Retirement bloggers. He is, at least in my opinion, the leader in promoting frugality as a means to reaching FIER.

Not only does he claim that anyone can reach Financial Independence in 5 years, he actually became financially independent within 5 years of working after getting his Ph.D. in Physics. Jacob dives deeply into all aspects of life in regards to finance. For example, he explains how to optimize meals, minimize costs in life, and even have a successful relationship with your partner while pursuing FIER.

The book, “Early Retirement Extreme”, is really the first book anyone should read when thinking about pursuing Early Retirement.  

I do not intend to cover every aspect of the book since you can simply buy and read his book yourself (link). Instead, I will provide a general overview of what I find to be the most compelling parts of his book.

“I started getting an uneasy feeling that something about the world was not quite right. Nobody explained the “why.” Sure, they could explain how I should first purchase a “starter home,” so I could “upgrade” later. But nobody could or would explain why I should buy a house in the first place. Nobody could or would explain why I should have a career, only that career development was important.”


Plato’s Cave – The Lock-in

The first topic that Fisker goes over is the concept of “Plato’s Cave”. Plato’s cave is a metaphorical situation where a group of prisoners hasW been tied down to the floor of the cave staring at shadows cast on a wall by a fire behind them. The prisoners have been in this cave since birth, cannot change their position, and cannot see the other prisoners or themselves.

A dire situation to say the least.

Eventually, one of the prisoners escapes and sees the world for what it truly is, a wondrous place full of beauty and color. The escapee eventually feels the moral obligation to go back to the cave and try to convince the other prisoners that there is a whole world outside the cave, along with the idea that there is more to life than the shadows on the wall. To his surprise, the prisoners are reluctant to believe him. Leaving the cave takes much effort and requires a different way of thinking in order to believe in possibilities outside one’s perceived reality.

“In real life, the prisoners of Plato’s Cave are those who are prisoners or slaves to their wages and their culture. A wage slave is a wage earner who is entirely dependent on their wages. While the wage slave is free to leave the current job, he isn’t free to leave the job market altogether and he can likely not imagine the possibility of doing so. He is still entirely focused on the wall.”

Jacob makes a point that I fully agree with. Too many people are satisfied with the conventional 40 hours a week, 50 weeks a year, and 40 years of working in your lifetime. With the current culture of lifestyle inflation, too many individuals are stuck in “The Financial Trap” without even realizing it.

It takes a brave soul to think differently than others, an even braver soul to act differently.

Financial Independence Through Frugality

Frugality is the key tool that Jacob used to become financially independent. Instead of buying material goods, Jacob creates his own products and services. Instead of throwing out perfectly functional items, he prefers to sell them at fair market value.

Jacob considers himself a temporary user of an item as opposed to the owner of the item.  He does not believe in owning products throughout their lifetime, instead, he prefers to trade products or loan out the things that he owns. He also takes a similar approach to his housing and transportation situation.

One of Jacob’s key theories is to have an ‘optimal solution’ for any given problem or situation.

Jacob dives deeply into how people should optimize the geographical location of their home in relation to the type of transportation they should use. He explains elaborate situations in which it would make sense for someone to live incredibly far from crowded/expensive cities. But he also provides alternative hypothetical situations where living within a city could make the most sense, the point being that there is an ‘optimal solution’ (or ‘Nash Equilibrium’ for all my game theorist out there) for all situations.

Jacob dives into the optimal solution for many other topics such as:

  • Working out
  • Eating
  • Gardening
  • Plumbing/Electric Work
  • Relationships
  • Raising Children
  • Hair Cutting
  • Mending Clothes

The key component to his frugal lifestyle is having an ‘optimal solution’ for every situation in life. If you have a pot of water and stove, then you do not need a specific water boiling device. If you are looking to buy a book, movie, or game (yes, even games) and you have a library in your town, then you should spend time going to see if the library could provide the same book, movie, or game for free!

There is an optimal solution for all problems in life. We need to ask ourselves: are we spending the proper amount of money to fix a problem? Or are we overspending (i.e. going out for dinner compared to cooking at home)? Do I really need 5 bedrooms for 4 people in my home? Maybe I could fit 4 people in 2 bedrooms?

The Renaissance Man

In “Early Retirement Extreme”, Fisker talks about the concept of different types of men (I would use the word ‘person’ instead of the word ‘man’, but these aren’t my concepts):

  • The Salary Man – Most of us in society who work a typical 40 hour/week career
  • The Working Man – A worker who works many odd jobs for short periods of time (think freelance workers, wedding photographers)
  • The Business Man – This is your entrepreneur who earns money through owning their own business
  • The Renaissance Man – This type of man is a hybrid of all the men described above.

“A Renaissance man is a person who is competent in a wide range of fields, covering intellectual areas as well as the arts, physical fitness, and social accomplishments. This contrasts with the more modern, specialized approach, where a person is encouraged to build skills in a single vocation and use the income from that to pay for everything else… This isn’t the case for the Renaissance man, who develops all sides of himself to their full potential.

A Renaissance Man, in Jacob’s book, is a person who can bike 10 miles to work every day and make light work out of it. It describes a person who is able to hand stitch their own clothes instead of going to a tailor, cut their own hair instead of going to a barber, and even invest their own money instead of going to a financial advisor.

Instead of using financial capital to get work done, a Renaissance Man would use his social capital to get the same task complete. Rather than hiring movers to move furniture out of an apartment, the Renaissance Man would rent a U-Haul and convince friends to help do the heavy lifting. In return, the Renaissance man would do a favor for the friends or perhaps treat them to a much-deserved pizza lunch.

Most importantly, a Renaissance Man’s goal is to solve problems as a human instead of becoming a part of the “work-spend” system.

Jacob is definitely a Renaissance Man in the sense that he is able to provide his own plumbing service, electrical services, furniture, vegetables, business, and much more. Depending on your time and interest, you can also be a Renaissance Person!

Environmental Benefits

The last major compelling argument that Jacob made was that the economic theories of ‘supply’ and ‘demand’ are not being treated properly in today’s society. Supply and demand based theory will be sustainable in a growing market only if the problems of limited ‘resources’ and increasing ‘waste’ are dealt with.

“An ecosystem has four components,  which for a cycle: Abiotic (resources), producers (supply), consumers (demand), and decomposers (waste management). Modern economics only considers two of these relevant: producers and consumers… Naturally, the economy can’t keep growing without killing itself if the cycle isn’t completed. If the cycle is not completed, we’re either going to run out of resources or drown in pollution.”

He sees a serious socio-economic issue with limitations of ‘resource’ and constraints in managing ‘waste’. These are pretty obvious issues, but no one in the political spotlight seems to be tackling these major world problems. Where does all the garbage in landfills go? Hmm..

Jacob’s contribution to solving this problem of limited resources and growing waste is to simply not be a part of the consumer system. The logic is simple – if we stop buying consumer goods, suppliers will stop supplying consumer goods, therefore no waste will be generated and no resources lost.

Jacob argues that the mentality of recycling and trading goods should be adopted on a much larger scale in order to slow down this system of consumption without proper waste management. In general, Jacob goes on to describe how there will be an eventual collapse of an economy where resources are overused and waste is under recycled.

My Thoughts

“Early Retirement Extreme”, by Jacob Lund Fisker, is a good introduction into financial independence and early retirement. It absolutely gets the point of Financial Independence and Early Retirement across to the reader and makes some fair arguments in favor of the lifestyle. The book also does a great job in explaining how having a different mindset will allow for Financial Independence in 5 years.

Personally, I am aiming for an 8-12 year goal, but that is only because I would prefer to live a little more ‘luxuriously’. Like not living in a mobile home in order to achieve FIER.

Overall, this book is very helpful and definitely worth reading. There are many mathematical formulas and graphs in the book explaining incredibly complicated ideas that went above my head completely (and I was a Math major in college). There are some chapters (like the one about optimizing your working out) where I would prefer he not write about the subject as it seemed irrelevant to the overall theme of FIER. If you can ignore some of these confusing parts of the book, it is a good read.

The theory and framework within Jacob’s book resonate well with me, as he was in a very similar situation to the one that I am in. Jacob was relatively young, without children, without a mortgage, and also seemed to have a reasonable start in his adult life when he wrote this book. He did, after all, graduate with a Ph.D. in physics. Like me, he did not seem to have any significant hardships that may have made his dreams of FIER an impossibility. It is easy to write from the perspective of myself and Jacob, where we are young and have many fewer restrictions tying us down to a specific lifestyle. The questions posed to the reader in this book are much easier to deal with for people with more options in life and much harder to deal with if you have already made some poor decisions in your life.

For instance, Jacob does not ever mention what to do if you are older without a college education. He does not mention what to do if you have already committed to a mortgage and have 6 family members living in the house. There are many real-world situations in which the advice given in this book would not be applicable. Instead of providing solutions to your current financial problems, this book provides a mental framework of how to achieve Financial Independence.

One topic not covered in this book is specific investment strategies. The author says that everyone should simply invest in what they know best, whether it is lumber, real estate, or the stock market. Jacob can care less what your investment vehicle is, as long as you invest. But for those keeping score at home, Jacob himself likes to invest in stocks!

I would recommend this book to anyone looking for a good introduction into Financial Independence through frugality.


Information (4 out of 5)

Entertainment (3 out of 5)

Readability (4 out of 5)


Amazon Soft Cover Link


Amazon Kindle Link Below



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