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As your family matures and you make strides in your career, you may be thinking about taking an early retirement. This means a lot of hard work and a tremendous amount of financial preparation. Here are some tips that you can use to get on the path to early retirement.
Don’t stop at a 401(k) plan
If you’ve been consistently contributing a solid amount to your 401(k) plan, you’re on the right track to a comfortable retirement. However, this type of savings alone may not be enough to retire early. That’s why it’s critical to your early retirement that you educate yourself and develop a plan as soon as possible. At this stage in the game, you might want to enlist the help of a financial planner who can help you navigate the path to an early retirement. A professional will probably cost money upfront, but you can gain valuable insight on IRAs, annuities and the healthcare that can take you through your retirement years.
Pay yourself
As your family matures, you are probably facing some considerable expenses, such as college tuition for your kids. This can cause you to get lost on the path to early retirement and it can be hard to backtrack. Of course, you want to give your kids all of the tools they need for a successful future, but don’t forget about your own. When it comes to college, remember that your kids can get scholarships and student loans to help offset the expense. Unfortunately, there are no scholarships or loans for retirement, so continue saving and investing for your own future if you want to retire early.
Consider semi-retirement
Planning for an early retirement at any stage in your career takes some serious financial know-how, as well as a great deal of hard work. If you are just now thinking about retiring early, and your kids are soon going to be college bound, you might want consider a working retirement. If you have been saving and investing, but you aren’t quite ready for full-on retirement, you might want to consider consulting, freelancing or working part time. At this point in your career, you have probably acquired a great deal of expertise and experience in your field, which other professionals and companies could find quite valuable to their businesses. Semi-retirement allows you to enjoy a flexible schedule, while still taking advantage of some income and benefits. Don’t rule out this option, especially if you find your early retirement plan coming up short.
Published on January 08, 2007