Are you someone that wishes to retire early? Retiring early has become a more important thing among many working individuals. To me, the word retirement just doesn’t feel right. Maybe it’s because for the longest time the word “retirement” has been associated with a rocking chair on a porch. For many, early retirement is more about becoming financially independent. Embracing a life of freedom as well as reducing stress and not worrying about rush hour or alarm clocks. It also means having more time for the things and people that you value the most. These might seem like fantasies but becoming financially independent and leaving the workforce early can be within anybody’s reach. Believe me, getting up and going to work is way more enjoyable knowing you are financially independent and not stuck.
One big issue with becoming financially independent is that people fail to plan. Some people seem to have this issue because they do not do the long-term math. For most, it comes down to procrastination. I have seen this first hand more times than I can count. I have had conversations with people about planning and all too often people want to push it off. Then something will happen in their lives and suddenly planning for retirement becomes a major priority. The problem is, unlike a math test, you can’t cram for retirement. Don’t wait for something to happen in order to get yourself in gear.
Financial planning is also essential if you are considering financial independence. However, one way to ensure that you can peacefully and confidently retire early is to clearly figure out the amount of money you presently have and will have. This is known as your net worth.
Your net worth is usually calculated by means of adding up the value of all your assets and then subtracting all your existing debt, including credit card debts, loans, mortgages, and more. If you know how much money you have, you will also need to know how much is needed for you to retire.
When striving for financial independence, it is very important to plan. Planning your retirement will make it so that you know how much money you must save and you will also find out how much money you will need to live the rest of your life without working. Take advantage of employee sponsored retirement plans (401k, 403b, & 457 plans just to name a few). Great benefits to these are in some cases the employer is contributing on your behalf as well.
Without planning for your retirement, things may not go as you were hoping for and might not fall into place the correct way. Planning helps to give you an idea of all the details that will be important to accomplish your goals. If you need help with planning for your retirement, contact The Retirement Planning Group today!