Early retirement is an intentional strategy for retiring before retirement age. Achieving early retirement means saving enough money to live comfortably in retirement without having to work into your 70s or 80s. Several strategies can help you reach early retirement, and Mark Hauser, a Certified Financial Planner™ and wealth advisor at Wealthfront, has outlined some of the most important in his latest article.
Why retire early
Retiring early is not only an excellent idea for personal financial reasons but can also be incredibly freeing and rewarding. Here are five reasons why early retirement is a great idea:
- You Can Live Better on Less Money. If you retire at 55 or earlier, you can expect to live 10 to 15 years longer than if you retire at 65. Inflation factor, and you could be living much better on much less money when you retire early.
- You’ll Have More Time To Do What Matters Most To You. When you retire early, you can focus on the things that truly matter to you in life- your family, your career, your passions.
- You’ll Have More Time For Your Friends and Family. Many people feel like they’ve lost time with their friends and family when they’re busy working. By retiring early, you can enjoy more time with those close to you while still providing for them financially.
How to decide to retire
If you are considering retiring, now is the time to start planning. The sooner you decide, the easier it will be to put together a realistic plan. You don’t have to wait for retirement to begin planning; you can start today by taking these steps:
- Figure out what kind of retirement you want. Figure out if you want to retire now or you want to continue working until you are no longer able to work. Figure out the type of retirement that will fit your needs and circumstances if you decide to retire now. Many options are available, including partial pension, early retirement, and retirement at age 55 or older.
- Create a retirement plan. Retirement planning isn’t just about saving money; it’s also about making sure your lifestyle will change when you stop working. Start by creating a timeline of your expected life after working and retirement years, then develop a budget based on that timeline and your specific needs and wants in retirement.
Planning your lifestyle after retirement
Mark Hauser is a financial planner with more than 20 years of experience helping people plan for and achieve their retirement goals. In his latest blog post, he outlines some strategies for early retirement planning.
- Create a savings plan. Once you estimate your annual income needs, create a savings plan that targets those needs. This could include investing in individual stocks or mutual funds. Make sure to review your savings plan periodically and adjust as needed to maintain consistent progress towards your retirement goals.
- Review your pension options. Suppose you currently receive a pension or other retirement benefits. In that case, it’s essential to review the terms and conditions of that benefit to ensure that it’s still worth pursuing after you retire.
As we all know, life changes can happen at any time. Maybe you just had a baby and suddenly have less time to work. Perhaps your career path has shifted, and now you can only work part-time. Regardless, it is essential to begin thinking about how you want to retire as soon as possible to ensure that your plans will align with your current circumstances.