There is nothing quite as appealing in life as the prospect of retiring early. However, it is not a decision that you should make on a whim. Remember, while you will gain additional years in retirement, you will lose the income you would have generated in those years, had you continued to work. This leaves you with two choices; living on a smaller budget and making sacrifices in your lifestyle, or, finding other ways of generating an income that will allow you to have a long and happy retirement.
First of all you need to determine how your current income stacks up against your chosen retirement age. The earlier you retire the less time you have to save. With improvements in lifestyles and healthcare you should anticipate living into your nineties, which means more retirement years, too. So begin by calculating how much assets you will have per year, based on your current income.
If you really want to enjoy your early retirement, make the sacrifices while you are young. Take a second job to offset the income you will lose in your retirement years. You should also consider easing into your early retirement, by continuing part time work to support yourself. Many retirees start their own small business, drawing from life skills to do something that they enjoy and earn an income as well. Start planning your second career or business now, so that you are well prepared for your retirement.
Higher growth investments are a good strategy for generating retirement income, provided that you start early. Taking risks with equities can pay huge dividends if you allow yourself the time to recover from dips in the market. Potentially, you could end up making up your shortfall without having to work a single day longer than you want to. When you get closer to your retirement age, you can then move to more secure investments. Don’t leave it too late to get in on investments that will work for you, organize your retirement portfolio today.