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A man who retired at age 30 is using this strategy to teach his 10-year-old son about money

Mr. money mustacheJeremy Vohwinkle/flickrMr. Money Mustache retired comfortably and debt-free at age 30.

After working in standard tech-industry cubicle jobs for just 10 years, Peter Adeney (better known as “Mr. Money Mustache”) and his wife Simi retired comfortably and debt-free in order to start a family in Longmont, Colorado.

That was in 2005, right before Adeney’s 31st birthday.

They didn’t win the lottery or inherit a fortune — they weren’t even earning abnormally large paychecks. Combined, their salary amounted to $134,000 a year.

They did it “simply by living a lifestyle about 50% less expensive than most of our peers and investing the surplus in very boring, conservative Vanguard index funds and a rental house or two,” Adeney writes on his blog.

Today, 11 years after retiring, he’s earning about $400,000 a year through his blog, but he and his family spend just $24,000 of that for annual expenses.

Despite having “never heard of personal finance,” as he told Nick Paumgarten of The New Yorker in a recent article, he’s clearly figured out how to master his money, a skill that he’s passing down to his 10-year-old son, Simon.

One simple strategy involves a bike. Adeney pays Simon 10 cents for every mile he logs on his bike, Paumgarten reports. He’s up to 1,300 miles — which is $130 of biking money — and has $700 of total savings. Not bad for a 10 year old.

What’s more, Simon’s savings are sitting in the “Bank of Mr. Money Mustache” and growing at an annual interest rate of 10%.

In addition to passing along a healthy lifestyle — Adeney also bikes year-round, going through just two and a half tanks of gas a year — he’s teaching his son the power of compound interest, which, if leveraged at a young age, can get you to the seven-figure mark by retirement.

While retirement is a bit far off for Simon to concern himself with, college is less than a decade away. With regard to that expense, Adeney told Paumgarten, “I would rather Simon find a way to pay for it himself.”

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