How many of us want to retire early? Basically everyone right! Who wouldn’t want to retire early, is the real question. But what’s an even more vital of a question than that? HOW can you retire early, especially in this economy.
Retirement is often viewed as a happy, and yet very stressful and difficult process. However it doesn’t HAVE to be difficult, and if you start preparing now with these simple steps, you can retire successfully, comfortably, stress-free, and most importantly- early.
1. Tracking and Organizing Your Spending
This has the potential to be one of the easiest steps towards retirement, with the monumental question of “How much do I need to save?”. This phase should start early; you can be 25 or 45, but preferably you want to start your plan to save, early on. Depending on how much money you are making at the time of saving, as well as how much you want to retire on. Also consider, at what age do you want to retire yet as well.
So, how much do you need to save? Think about the kind of life style you want to live when you retire. Are you strung with the idea to travel, see the world? Are you in love with the idea of having nice things and just retiring in a beautiful home? Or are you content with living a simple retired life in your home town? Consider what your current income is per year, and what you currently can live on comfortably. You want to have enough money saved to support you for the rest of your retired life!
Your first step would be sitting down and figuring out where your finances are headed right now, and calculating how much you may want to save. Once you begin tracking where all your money is being spent currently, you can then organize this. This can be done with a financial advisor, online finance organizers, or even just by hand on a spreadsheet you create!
Set aside time to make some calls, get all your spending into one place, and decide from there how you can increase your savings. Which avenues can you reduce spending in, what services could you possibly cancel? Are there services that could be made cheaper through another company, or are you eligible to refinance your car, or home? All is said and done, you are now able to put those same funds towards your retirement savings instead. Getting a hold of your spending NOW, will go a long ways for your retired future.
Just as important as taming your spending habits, is deciding on what you want to invest in. You will likely be drawn to invest in a diversified portfolio to help reduce risk. Of course, the portfolio is often created with your Financial Advisor, and an investment discussion will be involved in the process. However, the investing phase will journey along and accumulate throughout your lifetime.
Especially if you are one who is planning your retirement early. Investments will come with time. Take your time and make smart, and realistic investments throughout the course of time, as well as when you near retirement. As you get closer to your retirement, you will have your accumulated investments, as well as other options for investments. We certainly recommend setting up your plan with a financial advisor to reduce risk, and look at all possible options.
3. Housing, Health Care, and Taxes
You should also consider the factors or daily life in retirement, such as housing costs, health costs, taxes and inflation. Currently, do you own your house, renting, or making mortgage payments? Do you plan on remaining in that home for retirement, or are you considering a retirement community?
What is your plan for healthcare? Do you currently receive healthcare through your job, or is it independent? Have you factored in healthcare costs with your retirement savings plan? As far as taxes goes, there is much to consider there, as taxes and inflation steadily rise every year. You will need to include an estimation of your annual tax bill in your retirement savings plan. You may also need to consider the taxes involved in any money coming out of any retirement account. We certainly suggest planning a time to sit down with your financial advisor to put together a practical plan that factors in all of these elements with your savings plan.
Finding a Financial Advisor
Of course most early retiree’s consider seeing a financial advisor who is in the surrounding area. Thought that is not always the case. Regardless of your location, plan to take some time out of your days planning your retirement, to meet with an advisor to get a more strategic plan laid out. Come see us over here at Assured Retirement Group to get started on your retirement plan.
Or Download your FREE Retirement guide from Assured Retirement Group, to begin your retirement plan early on. If you are still a bit early for retirement, this guide will undoubtedly help in your planning process; providing a spreadsheet and checklist for organizing your current income, investments, etc. and so much more.
We’ll See You Soon!