Last year readers went bonkers over an interview The Washington Post did with Mister Money Mustache, a personal finance blogger whose no-nonsense approach to money allowed him to retire at age 30.

Since our first conversation, Pete, as he’s known, has come back to answer questions about how his family got into the habit of saving aggressively and how they balance necessities, like health insurance, with wants, like travel.  We hope he will make occasional appearances in our new section. (He is, after all, retired.)

But that first chat brought attention to some tried-and-true advice that still applies to anyone seeking to take control of his finances. One gem: Think of debt as a “huge emergency, like running around with your hair on fire.”

Here are some highlights:

The Washington Post: Interesting name you have there. What’s the story?

I imagine the Mr. Money Mustache character as this old-fashioned financial sage from days gone by. He runs his old western town with quiet wisdom: The business leaders from Wall Street seek his advice, and the mayor checks with him on issues of town policy. He takes time to dish out a wise lesson or two to the local children, occasionally, and with a sparkle in his eye, he flips them each a golden coin with the tip of his thumb. “Invest it wisely, children, and you too will grow to be Mustachians!”

So there’s that, and the fact that all those M’s just sound great together. Plus, the convenience of how Mustache rhymes with Cash — as in “You Must Stash your Cash.”

So you retired at 30. How did that happen?

I was probably born with a desire for efficiency — the desire to get the most fun out of any possible situation, with no resources being wasted. This applied to money too, and by age 10, I was ironing my 20 dollar bills and keeping them in a photo album, just because they seemed like such powerful and intriguing little rectangles.

But I didn’t start saving and investing particularly early, I just maintained this desire not to waste anything. So I got through my engineering degree debt-free — by working a lot and not owning a car — and worked pretty hard early on to move up a bit in the career, relocating from Canada to the United States, attracted by the higher salaries and lower cost of living.

Then my future wife and I moved in together and DIY-renovated a junky house into a nice one, kept old cars while our friends drove fancy ones, biked to work instead of driving, cooked at home and went out to restaurants less, and it all just added up to saving more than half of what we earned. We invested this surplus as we went, never inflating our already-luxurious lives, and eventually the passive income from stock dividends and a rental house was more than enough to pay for our needs (about $25,000 per year for our family of three, with a paid-off house and no other debt).

What sort of retirement income do you have?

Our bread-and-butter living expenses are paid for by a single rental house we own, which generates about $25,000 per year after expenses. We also have stock index funds and 401(k) plans, which could boost that by about 50 percent without depleting principal if we ever needed it, but, so far, we can’t seem to spend more than $25,000 no matter how much we let loose. So the dividends just keep reinvesting.

We also have hobby income occasionally — I love to build things, so I do some carpentry work for friends and family. Usually it is free, but I also get paid sometimes.

What are the different ways you think about debt?

People have become too complacent about debt, making piddly monthly payments on a high-interest credit card while they continue to go out and buy more luxury products for themselves, ensuring the debt is never retired.

To combat this tendency, I encourage people to consider it a huge emergency, like running around with your hair on fire. Or like standing in an enormous cloud of killer bees, which are stinging every square inch of your body. Occasionally I’ll even have to pull out the old “cauldron full of boiling lava and poisonous snakes” metaphor to properly convey the urgency.

After internalizing these scary scenes, people develop the appropriate aversion to doing something like financing a new car, instead of waiting until they have cash to afford a used one.

Click here to read the full interview. 

Read more:

When your second career starts at 73

Retirement mistakes people make at every age

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