Last Updated on October 9, 2020
Retiring early is probably a dream many people share. However, for many, it’s not much more than that. But if you start planning as early as possible and make some sound investments and job choices, there’s every chance you could find the best way to retire early.
Making the Right Choices to Retire Early
The best way to retire early is to invest any spare money into property. Things like stock trading is too volatile, and savings accounts don’t yield the type of return you need. Of course, a well-paid job is vital too so that you can not only make enough money to live off, but so you can also set some aside as you earn.
But if you’re wondering, “How much money do I need to retire early?” then we’ll break down some figures so we have a concrete amount to work with. Our assumptions are as follows:
- You want to retire at 50, perhaps earlier. The earlier you want to retire, the more money you’ll have to make at a faster rate.
- Your maximum life expectancy is 100, but more likely it’ll be somewhere in the mid-80s.
- We won’t count on any interest after inflation and taxes; this is simply money you’ll have to hand.
- You can comfortably live on $50,000 a year for bills, vacations, etc.
- Spending will vary depending on your age, but will equal out over time.
Answer: You will need at least $2.5 million if my calculator telling me the truth. To be on the safe side, I would say $3 million.
(i) These variables are different from person to person. If you want to run a simulation and see some numbers adjusted to your own needs and assumptions check out this early retirement calculator by folks at millennialmoney.com
The Best Way to Retire Early
Invest! Property is your best bet for investment because it’s one of the few things that remains stable and increases in value over time. A diversified portfolio is the best way to protect against market crashes and other potential issues.
For example, look at buying some rental residential properties; these are a sure-fire investment. Alternatively, agricultural land leased out to a business is another quality investment. After all, as long as people need food, companies will need land to grow it on.
So when it comes to how to retire early, you obviously need to be smart with your money. Either bring an accountant on board, or take some accountancy or investment courses. The initial cost will be a great benefit to you in the future as you’ll know exactly how to manage your money for the best returns.
When it comes to investing in property, you need to pay attention to the most secure investments that’ll provide returns on your seed money. Getting involved in property flipping is another great idea, as you only need the start-up capital to make some good money.
(i) If you would like to learn more about flipping houses I recommend you check my book “Think Like a Tycoon – Profit From Selling Distressed Properties”
The Best Way to Retire Early is to Invest
In short, the best way to retire early is to make good money as early in your career as possible and then invest. The more diversified your investments, the better chance you have of making that sweet retirement pot. Just remember to only invest in secure options to minimize your risk.