Early retirement sounds like a dream for many people – but the absolute truth is that it can be done as long as you really want it. What are some of the most important things to know about early retirement and how to really achieve this goal? We have gathered some tips for you – so read on and find out more.
Set a Realistic Goal
It is very important to know exactly when you want to retire. This will help you do the math and see exactly how much money you need to live comfortably for the rest of your life. It will also help you know exactly how much money you need to save every single year until you reach your goal.
However, please keep in mind the fact that it is very important to set realistic goals. You may want to retire at 55, but if your income doesn’t allow you to save too much and if this pushes you into even more debt, you might want to reconsider your retirement age. Pushing it just a few years farther can mean a lot for your current finances and it will still be an early retirement.
Don’t Put Your Eggs Into One Basket
Once you have decided when you want to retire and how much money you have to save in order to achieve your goal, make sure to invest your money in a variety of ways. Stocks, IRAs and equity tend to be among the most popular retirement investment options – but it is of the utmost importance to study all of the options you have and to settle on those which actually suit you (and make you feel safer).
Also, it is more than worth reminding you that you should make sure to vary your investments as much as possible. This way, if one of your investments fails, you still have the other ones to rely on and you can reconsider your priorities, so that you don’t lose a lot of money and so that you can still keep yourself on the right track.
No matter how much you plan, you will always be influenced by things that are simply out of your power. The economy, the politics and the evolution of science and technology can all have a huge impact on your investments – so be prepared to be flexible.
Yes, we like to think of the best case scenarios. But beyond them, it is also crucial that we are flexible and open to finding new investment opportunities when we fail. For example, a new economic crisis like the one in 2008 can have a very harsh impact on rental properties – so it is important to be prepared for this kind of situations as well.
Stay focused and keep your goal in mind! Yes, retiring early can actually happen and it is more than doable – but you will have to stick to a plan and you will have to be very ambitious about it!