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An entrepreneur who retired at 36 says his simple investment strategy means he'll never have to work again

Jeremy Schneider
Jeremy Schneider retired at 36 and now lives off of his investments.
Jeremy Schneider

Jeremy Schneider never wanted to work for a big company. He graduated from the University of Michigan with a master's degree in computer science but turned down a job offer from Microsoft as a software engineer.

Instead, he transitioned from being a broke college student to being a broke entrepreneur, trying to get his own company off the ground. He promised himself that if he couldn't afford health insurance after a year of running the company, he'd give up and get a job.

It took three years for Schneider to be able to fully live off of his company, Rentlinx, an advertising website for rental properties. During those years, he learned to live on a tight budget, drove around in a 16-year-old vehicle, and lived with a number of roommates. 

Twelve years later, in 2015, he sold his company, walking away with about $2 million in his pocket at the age of 34. He stayed on with the company for another two years before retiring.

He's now 40 years old and hasn't worked full-time since leaving his company. However, he's been able to double his net worth in the last six years by investing the profits from the sale of his business. His blog, the Personal Finance Club, teaches others how to gradually build and live off their net worth. And it doesn't require building an internet company. 

Below, Schneider shares with Insider how he's been able to double his net worth and continue living off his investments.

He buys and holds diversified index funds 

Schneider has 90% of his assets invested in broad market index funds; he leaves 10% for playing around with high-risk investments. His index fund portfolio is based on 60% US index funds, 30% international index funds, and 10% bond index funds. Schneider keeps his risk and fees down by avoiding individual stocks or day trading. He also does not invest in actively managed mutual funds or pay an advisor. 

Since he has another 25 years before his target retirement age, Schneider doesn't have short-term concerns when it comes to market volatility and focuses on how his portfolio will grow gradually overtime. He mitigates his long-term risk by choosing target-date index funds, which are routinely managed to steadily reduce risk as you near retirement. 

"Whatever happens this year isn't going to matter in 30 years. So you just keep going and stay the course," Schneider says. 

Vanguard and Fidelity are his go-to choices when it comes to brokerage accounts. For information, he reads Morningstar, a research and ratings platform for investors, and uses Portfolio Visualizer, which shows backward-looking charts of how investment portfolios do against each other over time. 

He has money in retirement accounts

When he was 17 years old, his father taught Schneider about retirement accounts and how compound interest works. He opened retirement accounts at a young age, and he's since accumulated about $148,000 between a Roth IRA and a traditional IRA.

He invested early and often into his retirement accounts. Now, depending on the annual contribution limit, Schneider always maxes out his allowable investment limit.

He spends less than he makes

Schneider sets his maximum withdrawal limit below 4% of his investment portfolio, which includes real estate. On average, he lives well under 2%. When he does need his funds, he withdraws based on a specific order: First, from his real estate income; second, from his index fund dividends, which paid out about $34,000 in 2020; third, Schneider may sell a few shares of his index funds to make up the remainder of his budget. 

His income is set to $5,000 a month. He has used the app You Need A Budget to keep track of his monthly expenses and net worth for the past six years. 

He invests in real estate

Schneider began investing in real-estate development projects in 2018, to balance out his index fund portfolio. He doesn't buy, build, or sell property himself, but invests in a syndicated real estate fund. 

This strategy has allowed him to be able to pull a third of his income from his real estate investments. As for the long-term rate of return, he estimates a 10% annualized return. 

Schneider's next financial goal is to live frugally while allowing his portfolio to continue growing. He wants to remain financially free throughout his life and reach a point where he can donate money generously.

As for his company, the Personal Finance Club, he plans on donating 20% of its sales to causes. So far, he's managed to donate $50,000 since October of last year to Donors Choose, which supports teachers, and Give Well, a non-profit that supports charities. 

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