As a banker, you see all walks of life. When it comes to retirement there were people who were carefree and others who are burdened. The ones who were pinching every penny or the ones who were headed on their next trip. Some even live in fear and are not sure their money will last.
Many think they can not retire early but, that should be the plan whether you think you will want to or not. Some people are caught having to retire early without the finances to do so. If you have the right reasons, it is easier to develop a plan so you are prepared.
So Why Should You Plan On Retiring Early?
Because you never know what can happen or where you will be in your career. Many careers are changing. If you have not kept up with
The Annoying Boss
The annoying boss may be enough of a reason, but you should be prepared regardless. Obviously, if you are already a boomer it may be a little late for this article but midlifers should take note. For those who can make changes now, do it.
You never know when there will be a regime change and you want to have the resources to leave on your terms.
Spend More Time with Friends and Family
If you are always tired or stressed from work you don’t feel as motivated to get together. I know when I was working I had to force myself to go on a trip or make plans. It sounded more appealing to me to stay on the couch and watch documentaries during my vacation time. I needed to recoup.
Since I have stopped working, I have been able to take trips, and everyone has noted how much happier I am. I used to look burdened when I was working, and I was a lot less fun. People know I will say yes to most invites now, so they reach out more.
Travel While You Still Can
Often health issues start to creep in during your 60’s. Traveling now is ideal when thinking about taking long trips or going into adventure travel due to aches and pains and other restrictions as we age. Hiking, white water rafting, and other adventurous activities are less attractive.
Vacations from work are hardly long enough. You have little time to recoup from your trip, and vacations are best spent without restrictions. Also, you can get better travel deals if you are flexible with your schedule.
Make Your Health A Priority
Stress, lack of exercise and poor diet from working long hours and not planning meals or making time to care for self is often a factor in many health issues facing people in their 50’s and 60’s. I know my job was causing my health issues and was my main reason for getting out of banking. As we age we are unable to handle stress the way we did when we were younger due to mineral deficiencies because stress depletes minerals and then, of course, there are those fun hormonal changes.
You May Have To Retire Early
Circumstances may change, and you may be forced to retire early. Health, downsizing, and competition in a smaller pool of young workers who will work for less is reality. It is best if you are prepared. Many people have ended up in dire circumstances because they were not financially prepared for a long-term problem.
Address The Future Today
Many Americans are far from retiring well into their 60’s and even their 70s. By addressing this now you have a better chance of fixing the problems that will arise later. Cutting your budget and taking a hard look at your finances is never a bad thing.
American’s have huge amounts of debt. Is it really important to have a TV in every room? Will the smaller SUV work just as well as the Tahoe? Are you still making ego purchases so you can keep up with the Jones’?
Look At Your Current Plan
When you look at your current plan you may realize you will not be able to retire until your 70’s. Talk with your financial adviser about where you will be at certain points. Most investment sites have calculators to help you see where you will be in the future.
Avoiding it will not change anything, and you may be limiting yourself in retirement because you did not want to address the issues.
Increase in Income
When you realize that you may not be able to retire like you planned you are more motivated to earn more. You will look at opportunities differently. You may work harder to get that promotion. Extra income can include a side business or second job. Investing in real estate is another way to increase income.
The Truth Is You Never Know What Will Happen in Life
Everything is temporary. If you can start preparing now, you can ride the waves of life with ease. Here are some budget tips to help you get there sooner!
- Debt: Pay off your smallest balances first then take that payment and put it on the next card or balance.
- Pay additional principal on your mortgage with your tax refund. Make at least one or two additional payments a year directly to the principal. It can shave 10 years off of your mortgage.
- Keep that car! Drive it until you can’t! Once you pay it off you may have some repairs but it won’t total what you pay in payments each year.
- Shop sales only for clothes, makeup, and housewares. The retail mark-up on new clothing is huge and a total waste of money. Buy offseason for next year.
- Stash as much into your 401k as you can. You will save money on taxes and you can use the catch-up plan through your employer.
- Get healthy! Nothing costs more than medical bills. I always had a high deductible for emergencies and put money in an HSA and the difference in my 401k. The company matched my contribution on the HSA and I saved a ton on insurance costs and again, on taxes.