Top 8 Ways to Retire Early

By Brendan Hughes1 Comments

Retired life is an attractive option during the years of returning home every night in the dark after a long day at the office. The thought of spending the day golfing, playing cards, spending time with family or tending the garden is what keeps many workers going during the long work days.

If the opportunity arises for these workers to retire early, they often jump at the chance. So what are the top eight ways to help individuals save enough so they can leave the workforce and enjoy their retirement?
  1. Start saving early. The earlier a person starts putting money into retirement accounts, the more they will have available later in life.
  2. Meet with a financial advisor. A team of financial advisors can help individuals set up a financial savings plan for a targeted retirement date. This team can also provide advice on tax savings that will help benefit the retirement account.
  3. Take advantage of workplace benefits. Retirement accounts are frequently part of benefit packages at workplaces, and often employers will match a percentage of funds contributed to those accounts by the employee – helping the employee save additional funds.
  4. Time your retirement with your investments. Financial advisors often recommend more risky investments for younger individuals and conservative investments for those who are closer to retirement age. The reason for this is that higher risk investments might result in higher savings, helping to build up retirement accounts. However, those who are nearing retirement don’t want to risk losing any of the savings they already have, and usually want to take advantage of smaller interest rates.
  5. Cut spending. Large, expensive items often prevent individuals from saving money for retirement. Is the luxury SUV a requirement, or would buying a budget-friendly family car help prevent the need to take money out of the savings account?
  6. Earn more money. Whether it’s a second job, or taking on extra work at the current job, having a larger income helps individuals save more money for retirement.
  7. Pay attention to taxes. Taxes are everywhere – from income to estate – and a person could owe a lot of money to the federal government if he doesn’t have a tax plan in place. Sometimes the plan will include tax-deferred accounts that can be used for retirement savings. Or it might involve making donations to help reduce the amount of money owed on income taxes. A financial advisory team can help create this plan.
  8. Consider creating an income for post-retirement living. Even if the career has ended, it doesn’t mean that a small income source can’t be found, like selling handcrafted items online or working at a favorite store in town for a few hours each week. Even though this work probably won’t include any health insurance or benefits, it could still bring in cash that could pay for entertainment during the week, and help reduce the need to draw on retirement savings.