![]() ![]() Chase it because you want to obtain something worthwhile. In the case of early retirement, that means being motivated by a carrot instead of a stick.ĭon't chase financial independence because you want out of a bad job. I believe people are much more successful (and happier) if instead of running from something, they run toward a goal instead. And yes, there are plenty of people who are hoping early retirement will solve their problems. Reading the financial independence forum on Reddit, you might think that most people want to retire early because they're trying to escape from something. However, I've noticed some common themes. Honestly, the reasons people pursue this goal are many and varied. Why would somebody want to retire early in the first place? Let's take a look at the basics of how to retire early - and why you might want to do so.īefore we dive deep into the numbers, let's get a little philosophical. That's not to say you shouldn't plan to retire early - it's a laudable goal, one that I encourage here at Get Rich Slowly - but if you're serious about doing so, you need to be diligent. Even if you stay healthy and the economy cooperates, that's asking a lot. In short, early retirees have less time to make money, and that money has to last them longer. (I'm experiencing issues with this gap already!) ![]() You also face penalties if you choose to access your retirement accounts before you reaching minimum age requirements. If you retire young, you can't access Social Security or Medicare for several years - or decades. You don't enjoy traditional retirement benefits.If you retire at 65, your savings will probably have to last only ten to twenty years if you retire at 45, your savings may need to support you for thirty or forty years. Life expectancy for the average American is nearly 80 years. You spend more time living on your savings.But if you retire at 45, you only have 25 income-producing years. ![]() If you start working at 20 and retire at 65, you have 45 income-producing years. In general, those who manage to retire early have opted to live with less when they're younger so they can obtain financial freedom before they're too old to enjoy it.Įarly retirement is a fantastic goal, but it can be tough to achieve. These folks aren't lucky lottery winners, and most didn't have high-paying careers. (Previous surveys have shown that 18% of people retire by age 55.) In fact, the 2018 EBRI Retirement Confidence Survey found that 35% of retirees left the workforce before they turned 60. Still, there are a surprising number of folks who manage to retire young. We like our iPhones and Playstations and Priuses, so we surrender to the idea that we'll have fifty-year careers. Lots of us dream of leaving the workplace in our forties or fifties instead of sticking it out until age 65 - but we keep working to support the lifestyles to which we've become accustomed. Early retirement gives us the flexibility to choose how we spend our time, whether that entails sitting on the beach drinking margaritas or it leads to new work that provides meaning and fulfillment. Why retire early? Well, for most people a job is a necessary evil. There's been a lot of buzz in the media lately about early retirement, and that's led folks to wonder how much money they would need to quit their jobs - or if early retirement is even something they should consider. ![]() More and more, I'm meeting people who want to know how to retire early. ![]()
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