How To Retire Early
Posted by March 27, 2014in Life Transitionson
It is no secret that most of us fantasize about retiring early in order to explore the world or immerse ourselves in hobbies that we have never had time for in the past. However, before you can actually retire, you have to properly prepare for it. There are certain steps you can take in order to retire early. Retirement should not happen when you can no longer get out there and do the things you love to do, so why not begin preparing now so you can actually retire early? Knowing how to retire early is all about knowing the best things to do now rather than later. Here are a few things that can help you retire early.
Start Saving Money Now
One of the reasons so many do not retire early or even retire when they reach normal retirement age is because they simply do not have the money saved. When you start working, you should start saving money right away for your retirement. Along with using a 401K, you should use a separate method to save extra money, whether that is investing your money in the stock market, in real estate, or a certificate of deposit in which the interest rate is fixed for a certain amount of time. The key to saving money for your early retirement is to ensure you have enough to live on now while still putting money towards your future.
Know Your Insurance Options
One of the keys to retiring early is knowing how insurance is going to work once you retire. Since Medicare insurance will not kick in until you are of a certain age, retiring early means having a plan for what kind of medical insurance you will need. Also, since you are no longer employed, your company insurance plan will probably not continue which means it is up to you to find a plan that will keep you covered. Before you retire early, make sure you know what kind of coverage you need and how much that coverage is going to cost you. Since you are going to be in a transition period of your life and may not need this insurance plan for very long, you should consider choosing a short-term medical insurance plan that will give you just the right amount of coverage at the right price during your time of transition or while you look for a more permanent insurance solution.
Set Goals for Yourself
While it may take getting used to, making small adjustments like making coffee at home instead of purchasing a non-fat soy latte at the nearest big chain coffee shop can save money in the long run. In an interview with the Washington Post, a blogger who goes by the name “Mr. Money Mustache,” who retired at the age of 30 suggested people ask themselves this question: “Will this really make me happier in the long run?” Setting goals for yourself when it comes to retiring early can be anything from having a certain amount of money saved by a specific date to avoiding purchases that quickly add up and drain your funds.
Since you are going to be doing everything and anything you can do to meet your goal of retiring early, you may run into a few money saving scams. Before you invest any money in anything, you need to make sure you research companies and any individuals who may approach you with plans. Since you are planning to retire early, your money is very valuable to you and as a result you need to be able to have a solid plan of how to invest it and make it work for you.
Retiring early is not just about saving money. Rather, it is about changing your lifestyle now so that you can have the lifestyle you want in the future. Riding your bike instead of using a car to get to work, taking advantage of public transportation, cancelling your cable, and growing your own food are all simple ways you can save money and have a huge impact on your future.