Five years without a salary: my financial independence review

Last updated: February 2026

Five years. That's how long it's been since I permanently left salaried employment. Five years living off passive income. How is that possible? Here is an honest, unfiltered review of a life many imagine but few dare to pursue.

What do you call this new life?

It has been five years since I permanently left salaried employment. After all this time, I still struggle to label this situation. The word "retirement" doesn't suit me, even with "early" in front of it — I'm far from the retiree who watches TV all day or plays golf. "Financial independence" doesn't quite cover it either, since it's merely a prerequisite — one I had achieved well before leaving my job.

I find it paradoxically easier to describe this period by the absence of salaried work than by any term that would capture all its elements. And yet this life is anything but an absence. On the contrary, it's fullness itself. Perhaps because our vocabulary is far too rich when it comes to work, and desperately poor when it comes to everything else.

My daily life without a salaried job

Socially, I introduce myself as self-employed. People don't realise I spend only around ten hours a week on this side activity. This life sometimes reminds me of my student days — plenty of free time — except that today I have a family to support.

That's actually one of the most precious aspects of this new life: I have more time for the people I love. It comes with a few added responsibilities, of course, but these have nothing in common with the constraints of professional life.

Before, I was stressed at work, then rushed through my leisure time trying to make the most of every free minute. Today, my schedule revolves around my family and my passions — and that's more than enough to fill it. I'm almost embarrassed to admit it, but I sometimes find myself short of time. And I immediately laugh at the thought, wondering how I ever managed when I was working full-time.

The financial review after five years

Financially, I live primarily off my portfolio (dividends and capital withdrawals). In line with my five pillars approach, I supplement this income with:

• rental income from my former primary residence (used to recover part of my LPP pension capital);
• my small independent side activity (social connection, AHV self-employed status).

On the spending side, the picture is paradoxical. On one hand, there were savings I hadn't fully anticipated:

• with more time available, I handle far more tasks myself (DIY, cooking, admin, etc.);
• savings on direct and indirect professional expenses were significantly higher than expected.

On the other hand, I'm starting to allow myself more in other spending categories. And here's where it gets interesting: after years of "paying myself first", learning to "treat myself first" is harder than expected. This is a psychological aspect I had partly anticipated — and it was one of the reasons I always rejected extreme frugalism. But reality exceeds anticipation. I now want to spend more than I did as an employee — and even that requires a conscious effort.

Financial independence without extreme frugalism: my approach

I've always looked with some scepticism at the more radical strands of the FIRE movement, even though I have great respect for their followers. During my accumulation phase, I saved around 20% of my net salary. That's modest compared to the 50–75% targeted by frugalists — but it was more than enough to reach financial independence, while still living the way I wanted.

This measured approach has an advantage I hadn't fully appreciated at the time: it avoids conditioning your brain to permanent deprivation. Because today, I'm convinced that knowing how to spend is more important than knowing how to save, once the goal is reached. Someone who has spent twenty years tightening their belt will struggle to loosen it — even when they have the means, even when it's the right decision.

It's worth noting that the savings rate is just one lever among many. The return on invested capital, the accumulation period and the target lifestyle all play an equally decisive role. With a safe withdrawal rate of around 3.5–4% (the basic "4% rule"), a portfolio of CHF 1'000'000 can theoretically generate CHF 35'000–40'000 per year without depleting capital over 30 years. That said, this rule is a "one size fits all" approach, with its pros and cons. The VPW method, by accounting for more individual parameters, has the advantage of adapting to each person's situation.

What I would have done differently

With hindsight, I could have made the transition about five years earlier. I was already financially independent, but I kept working part-time, gradually reducing my activity to zero. I needed that period to reassure myself.

If I had known it would be this smooth, I would have taken the leap sooner. But I also understand that this phase was probably necessary for me to feel psychologically ready — and that's an aspect that is often underestimated in FIRE planning.

My message to those still hesitating

Let this review serve as encouragement to everyone still enduring the tyranny of salaried employment. The light at the end of the tunnel may be closer than you think. In the meantime, stop over-calculating — and start living.

Want to plan your own path to financial independence? Explore my other articles on FIRE strategy and passive income.

Frequently asked questions

Do you need to be an extreme frugalist to reach financial independence?

No. With a savings rate of 20% of my net salary, I reached financial independence without sacrificing my quality of life. What matters is consistency and the return on your investments, not asceticism. A high savings rate speeds up the process, but it is not a prerequisite — especially if you start early.

How do you deal with the fear of running out of money without a salary?

Diversifying passive income streams is the best answer: equity portfolio and dividends, rental property, a small side activity. Each additional pillar reduces dependence on a single income source and builds psychological security, not just financial security. A gradual transition — progressively reducing working hours before stopping entirely — also helps.

What is the hardest part of living without a salary?

Relearning to spend without anxiety after years of accumulation. It's a genuine mindset shift, often underestimated in FIRE literature. Moving from "pay yourself first" to "treat yourself first" takes conscious effort and time — even when your finances are sound.

How much capital do you need to live without a salary in Switzerland?

It depends on your lifestyle and income structure. Applying the 4% rule, an annual budget of CHF 60'000 requires a capital of around CHF 1'500'000. But in Switzerland, other sources supplement this: AHV from age 65, LPP, and potentially rental income. The multi-pillar approach reduces the initial capital required. Use our FIRE calculator for a more precise estimate.

Does financial independence mean never working again?

Not necessarily — and this is one of the biggest misconceptions about FIRE. I still spend around ten hours a week on a side activity. Not out of financial necessity, but for social connection, AHV self-employed status, and because I enjoy it. The goal isn't to do nothing; it's to choose what you do — and with whom.

Sources and data

• Bengen, W.P. (1994). "Determining Withdrawal Rates Using Historical Data." Journal of Financial Planning — origin of the 4% rule.
• Trinity Study (1998), Trinity University, Texas — safe withdrawal rate over 30 years.
• Swiss Federal Social Insurance Office (FSIO) — AHV and LPP rules: www.bsv.admin.ch
• ASPIM-IEIF — average SCPI distribution rate 2024: 4.72%.
• Personal data and field experience, dividendes.ch (2021–2026).