Early (Reasonable) Retirement

Wouldn’t it be fantastic to be able to retire young and enjoy the golden years away from the 9 – to- 5 grind?  What is young?  I imagine any time prior to age 70….or before death.  And I am being serious about the death part.  I have spoken to so many who cannot comprehend the possibility of retiring at all.  I have known people who died while still hanging on to their jobs, or who passed away shortly after they finally decided to retire because they worked too late in life.

Fortunately, I will be retiring at age 56 (in three years), and my husband at age 60 (this year).   The truth is we are not “fortunate”.  We have been smart.  I do not think of it as an early retirement either, but a reasonable retirement that we have planned for.

Here are some tips that might help you get from here to there, too:

  • Marry an equal: Yes, of course, you can get to early retirement all by yourself.  Who needs a spouse? You say.  Fact is that most people will get married sometime in their life.  So, if you are going to do it, do it wisely.  Love is wonderful but there many thousands of people in the world with whom we could potentially fall in love.  But they are not all ‘right’ for us.  Most importantly, we need to be with someone who has a similar outlook for the future that we do.  A true match made in heaven is one that is based on similar desires, goals, and maturity. Watch out for the following red flags:
    • Careless spending
    • High debt
    • Inability or desire to plan for the future
    • Inability to maintain long term relationships
    • Unwilling to work things out rationally when there is a problem in the relationship
  • Plan your family thoughtfully: Children are wonderful, but how many do you need in order to live a happy and still affordable life?  The more children will likely mean the less contributions you will make to your retirement savings.  Either you or your spouse may decide to stay home with the children while they are young to save on child care expenses.  Believe me when I say, I completely understand.  I struggled with the desire to stay home, too.  But my children grew up very well with two working parents.  And the savings did not outweigh the financial losses I would have suffered had I stayed home.  The losses would have been the years spent putting time toward a pension, 401K savings, and social security credits.  The price of child care for two children in the late 80’s and early 90’s was about one of my paychecks for a month of care.  I probably earned about $7-8.00ph in those days.  But the point is, we kept on trucking and made it all work out.  And it was tough with two kids, I could not imagine having four or more.
  • Never give up on the marriage: In this day and age of disposable everything, even marriages have become very easy to throw away.  But the fact is, divorce is expensive and can cause a financial disaster.  This is not to say I encourage people who are deeply unhappy to ‘stick-it-out’ at all costs, just so they can retire early.  Absolutely not.  But, when trouble hits, it is never just the other person doing things wrong.  When things are not going well, step back and reevaluate.  Some positive actions can be taken to improve the rocky times:
    • Remember the person you fell in love with – he/she is still there
    • Appreciate the other person – all the little things matter
    • Express your appreciation – because it feels good and IS good for you both
    • Show affection – hugs, kisses, etc.
    • Take an interest in the other person’s interests
    • Help and give compassion to the other person without any expectation
    • Plan things to do together
    • See a counselor to help work through things
  • Always put money into a retirement savings plan: Even if you can only afford a very small amount, do it.  Every little bit counts towards that future and will earn compound interest over time.  If you were only able to put away $50 a pay period for 30 years, that alone would be $36,000 – plus all the interest it would earn over those years.  Of course, you would increase that amount of savings over time, as your earnings increase (hopefully).  If your company offers a retirement savings plan with matching funds, you would have double that amount!  Also, think about putting at least some of your money into the riskier funds for faster growth.  The ride may be a bit bumpy but it will be worth it in the long run.
  • Forego the move to a bigger, fancier house and neighborhood: You will save a lot of money by living more simply.  Making updates to your current home can be very satisfying and save you a lot of money.  Ask yourself what the real reason is that you would want a bigger house.  If it is out of need for the family (i.e. more rooms for all the kids), then do it.   Other reasons could be that everyone else is buying those awesomely big “McMansions” and you want to keep up with whoever the “Jones’” are.  Or does it make you feel that much more successful to purchase a new spectacular home?  Go for it, if that is your heart’s desire, but that new, larger, longer term loan will definitely take a chunk away from your retirement savings plan.  Remember the Jones’ are probably up to their eyeballs in debt.
  • Do not be afraid of retirement: Many people are so afraid of letting go of that guaranteed paycheck that they work much longer than necessary.  If you are worried about whether you will have enough to live on in retirement, consult a financial advisor several years in advance of your desired retirement date.  This will give you enough time to make catch-up contributions to your 401K and start getting bills under control and paid off before the big day arrives.
  • Know your health and heredity: Lastly, pay attention to what you know about longevity and health factors in your family.  If your parents passed away fairly young, as mine did, that is definitely a reason to want to plan for a retirement that begins at a younger age than maybe others would consider.

None of us are guaranteed a set number of years of life.  Anything can happen at any time.  But by making early plans for retirement (possibly an early retirement), perhaps we can enjoy many happy years just living life to the fullest, doing the things we love.


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