Some people love what they do for work and have no plans to retire. For every person like that, there are many more who would do anything to retire early to avoid doing a job they hate.
Do you need to buy lottery tickets every day to have any hope of making this a reality? Not at all. With some planning and financial creativity, you can set yourselves up to leave that job and be financially independent.
It will take some short term sacrifice and adjusting of attitude, but it is doable.
In this article, I will give you the blueprint to follow to retire early and enjoy your life instead of slaving at a miserable job.
1 – Create a mock budget
Before you can set about saving for your retirement, you need to know how much money it will take to live.
Remember that your bills now are not what they will be when you hit your retirement age. One of the things you’ll need to do right away anyway is to reduce your spending and get rid of a lot of bills.
Once you have everything pared down to the essentials then you can get a better idea of what kind of budget you will need and how much money you will spend on a monthly basis.
Start by tracking your expenses and read up as much as you can about financial responsibility on sites like Money monarch.
2 – Make lifestyle adjustments
You may be living an expensive life at the moment with premium gym memberships, eating out frequently or staying at high end hotels when traveling.
If you plan to retire early, then you will likely have to give up those types of comforts. Make a list of the things you can live without when you are retired and still be able to enjoy a lifestyle.
If you do want to have the finer things in life then you may need to actually work, which is perfectly fine for some who wish to retire early. For many the idea is freedom and flexibility so they can choose where and when to work rather than being tied to a dead end job.
3 – Start seriously investing
You should be saving money, but that doesn’t help your money to work for you. Only investing can do that. How you invest is up to you and your personality. Some people like to invest safely with low risk and low reward types of schemes. Others are looking for the big payout and are more accepting of higher risk and higher reward investments.
When you cut out your current expenses, put that money into some kind of fund. There are index funds, mutual funds and stocks and bonds that you should be buying.
4 – Talk with a financial advisor
Having a financial advisor on board early in your process when trying to retire early will help a lot. He will set you up on a course with lots of actionable items that will put you ahead of the game early.