Do you want to retire early or have you simply not given early retirement much thought?
Definition of Retirement
Retirement does not mean the same thing to everyone, it is just a word used to say that we have paid our dues. If a true survey was taken on retirement wishes however; not just the tangible (everyone want to be financially secure) but also the intangible experiences as well (like peace and happiness), we might find that many people have surprisingly similar hopes for that distant; or not so distant future.
Early Retirement Example
A good example of someone who retired early and has lived a very happy post-employment life would be Jim and Beverly Callen. He was an ad executive from Chicago and she was a stay at home Mom. After the college graduation of their youngest child, combined with habitual thrift and great preparation they were able to retire in their early 40s.
They have been traveling the world ever since and while they are in their 70s by now, they could certainly be the poster child for anyone’s idea of retiring early
Tips for Early Retirement
Following are a few tips that you might want to try if you are considering early retirement:
- Be Thrifty and Save: Start a savings account at an early age. Invest in an IRA or other type of pension plan like a 401K. Trim your budget of unnecessary items that represent wasteful spending.
- Purchase Rental Property: This method is used more often by young investors to assure a mortgage-free retirement income. But it can be a viable investment for the older investor as well (even with a mortgage) if there is significant cash flow. Use a tax calculator to see how you might benefit from mortgage interest and property tax liability.
- Start a Side Business: The idea of having a side business is popular because of the tax incentives. There are several other nice aspects to running a side business. If your business is on your laptop, it can be conducted from a pool side in Hawaii or at a ski lodge in Vail, so retiring for you, is just the next step.
- Start Investing in Stocks/Bonds/Mutual Funds/Forex/Futures: In yesteryear it was said that your bartender was your best friend, not so much in today’s world, your stockbroker should fit that bill. Find one,get to know and trust this person by being pro-active about every penny you place in his/her trust (Wall Street will never allow another Bernie Madoff) and then watch your money grow.
Winning the lottery, hitting the Jackpot in Atlantic City, or finding a pile of cash hidden in your attic, are all qualifiers to send you on the road to a work-free environment. But the odds of those three things happening are much slimmer than if your keep to a planned effort, as demonstrated with the previous four steps.
If you wait until you have to retire to start planning, more often than not, you have waited too long. So whatever your retirement wishes are, sit down today and plan your early retirement strategy.
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Your suggestions are excellent. My husband and I are both middle-aged with two teenage, almost adult, children. We can retire early because of the nature of my husband’s job and his pension. However, one of your suggestions really hit home, and that’s purchasing rental property. Here in Chicago, several of my neighbors have done that. As you’ve said, you can get a steady cash flow from this method. But the method that really hit home for me, that you’ve mentioned, is starting a side business on the Internet. There are so many opportunities to receive passive income on the Internet. Affiliate marketing, for example, income is a terrific way to make money with little to no work. Of course, you have to promote your interest, but once you get it going, the amount of promotion you need to do lessens or stops.