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The Ultimate Guide to Early Retirement Planning

Posted by Shanna Tingom, AAMS® on Sep 7, 2016 10:00:06 AM

Best Retirement Planner in Gilbert AZ

Hopefully, you enjoy your job and appreciate the impact you’re having in your professional life. However, all careers have an expiration date and there is nothing wrong with looking forward to a well-deserved retirement. But, if you want to retire early or even just retire securely, you need to plan ahead—decades ahead—and proceed with self-control and forethought to make it possible.

And it can be a lonely road. Many Americans today aren’t even saving enough money to retire independently at 65, let alone retire early. Their daily expenses are too high, their homes are too big, and their investment accounts are too small, leading eventually to a slow motion tragedy and years of regret. If you want to exit the workforce on your own schedule at age 60, 55, 50, or even younger, you’ll absolutely want to follow these basic guidelines and seek out the help of the experienced retirement planners here at Heritage Financial.

Live Below Your Means

If you aren’t saving anything now you won’t have anything in the future—guaranteed. Of course, Social Security Benefits can help, but those won’t be available until you reach your sixties. And you can always sell the house, but if and when you do, where will you move and how will you be sure that it will have kept its value?

Ultimately, If you want to retire early, you have to be the one to fund those years yourself. And you can, you really really can save the money you need. But you have to be willing to get into the right patterns and make the right choices. Choices and patterns such as:

  • Downsize. Live in a smaller house than you can afford
  • Buy a used car, but one new enough to avoid frequent expensive repairs
  • Budget your entertainment and get used to small splurges rather than big ones
  • Get good insurance to moderate unexpected expenses
  • Save 100% of your tax refunds, bonuses, and inheritances
  • Transfer 20% of your income to savings automatically. Don’t tempt yourself by letting it sit in your spend account

Invest

Americans these days are leery of the stock market, and justifiably so. The turbulence of recent years was hard on the retirement accounts of a great many, and going back and making the same mistakes seems like the wrong choice.

But, if you want to retire early with enough money to live off of comfortably until the end of your days, investing isn’t optional. Fortunately, you don’t have to do it alone. We can recommend the right products, typically diversified mutual funds with proven long-term performance and low associated costs.

And, once you are investing, you need to leave your money alone. Let it grow quietly without interference and don’t worry about daily, monthly, or yearly ups and downs in the market. After all, you’re playing the long game.

Schedule to Eliminate Your Debt—All of It

Americans are in debt for mostly good reasons: houses to live in and retire in, student loans to get good jobs, and car payments to take us to work. But we also have bad debt: credit cards, medical payments, car payments on luxury cars, and cash advances. If you want to retire early, however, you have to make a real decision. You have to decide right now to eliminate all personal debt as quickly as possible, while continuing to save and prioritizing investments.

This requires discipline, planning, and (typically) setting up some fairly ambitious automatic payments. We’ll help you make your schedule and can also recommend refinancing options to lower your rates, save you money, and make your financial freedom a bit more achievable.

Set the Proper Expectations

How much money will your retirement cost? How much do you need to have in reserve? When, precisely, will you get there with your current income?

If you have questions about retirement, early or otherwise, we can help. Call Heritage Financial of Gilbert, Arizona today at (480) 397-1184 to make an appointment.