While there are a lot of people dedicating their entire lives to their careers, what good is making six figures salary if you don’t have the time to spend it? The answer is simple; you save it for your retirement. Unfortunately, when this day finally arrives, things may not be the way you imagined they would. After years of work, work and nothing but work, you may find yourself in a position where you simply don’t know how to spend your free time. Furthermore, seeing how the social security retirement age moves upwards, you may not reach it until you are almost 70. This is why the only sensible thing to do is to plan an early retirement. Here are five tricks that may help you get there.
1. Start in Time
First mistake a lot of people make is believing there is time for everything. Although you probably won’t retire before you’re at least 65, make sure you start saving as soon as possible. You can’t start saving when you are 50 and hope to amass enough money to retire by the age of 55. Ideally, you should start in your late 20s or early 30s, and save a bit at a time. This way, two decades later, you can just start looking for reputable luxury retirement communities to move into.
2. Financial Education
The best thing about living in the age of internet is that the education is cheap and easily accessible. This is an opportunity you shouldn’t miss. A perfect idea would be to take a crash course on personal finance. This way, you will learn how to save money more efficiently, make better financial choices and how to govern your funds the best possible way.
3. Live Below Your Means
Sure, austerity is always difficult, especially when it is completely self-imposed. You may have enough money to enjoy a $5 latte every morning, but this really isn’t the way someone hoping for early retirement should think. Try to lead a more moderate lifestyle and in time, you will collect a substantial amount of money in your bank account. Of course $5 really isn’t much, but sipping the aforementioned beverage just three times a week would cost you $780 annually. Combine this with all other unnecessary expenses and there you have it – your retirement fund
4. Pay off Your Debts
Planning an early retirement in your 40s, while you still have twenty-something years of mortgage to pay off is probably not the most doable thing. Same goes with loans and credit cards. If you have any of these issues ongoing, you should first focus of paying them off. On the interest alone, you will be able to save at least part of what you need for early retirement.
5. Passive Source of Income
Finally, you can also set a passive source of income or two in order to support your lifestyle while in retirement. For example, you could rent out a property, trade on stock market or start a blog. The number of options is truly great so you should make a choice based on your personal preferences.
Retirement is the time when you should adjust everything in accordance with your own pleasure and forget about the rest. This is why, it is vital that you get to it while you are still relatively young. This way, you can fully enjoy everything you are presented with and will be able to see exactly what you worked so hard for.