How to retire in 35 years

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Is it in your life plans to work until old age? To many millennials, the traditional concept of retirement seems not very attractive. Early retirement has become the cherished desire of many US citizens from 25 to 45 years: websites and blogs are dedicated to this topic, on which they spread complicated financial calculations. "Lenta.ru report“Figured out how Americans retire young.

“The concept of retirement is undergoing metamorphosis. It seems that on this way, the usual retirement will cease to be the ultimate goal, ”says Jonathan DeJoe, owner of a personal capital management company. DeYoe Wealth Management.

How to understand that you can afford an early retirement

Fuck you money - so in the circles of early retirees is called the amount that will allow you to enjoy life without serious consequences, sending to hell the boring work. Of course, everyone has different financial needs. How to calculate the amount needed for a pension?

First of all, the early retirees assume that you need to accumulate a certain amount, and then make this money work by investing. Where to invest? On the one hand, this cannot be a high-risk operation, since in the case of an unfavorable scenario, “retirement” money is irreplaceable. On the other hand, it cannot be banal bank deposits (in the United States and Europe, using these tools, it has long been possible to receive only a purely symbolic income). In general, future retirees form future income through conservative (low-risk) investments in the stock market or real estate purchases.

“You can expect that over the course of your life, your savings will bring about 4% per annum. There are good chances that they will never run out. In other words, you need an amount that is 25 times your annual expenses, ”says Pete, author of a popular financial blog. Mr. Money mustache. He and his wife quit their jobs in 30 years, now he is 42. He says that the ideal stimulus for the accelerated accumulation of the right amount Fuck you money It was their decision with the wife to have a child already "retired." They all turned out.

In the circles of future early retirees and already established experts, the debate about how much money will provide a comfortable life in the absence of an active income does not abate. Many Americans believe that nowadays a million dollars is no longer a cake. However, those who have accomplished this are advised not to look for the average figure, but to calculate their own, which may be several times smaller.

The fact that everybody sees the ideal of early retirement differently affects the amount of money needed. Someone wants to not work at all, someone is still going to sometimes work “for the soul”, which can also bring some income. Some intend not to deny themselves anything, others understand that they can do without some spending. Finally, there is an option to move to a country with a lower cost of living, which is what many young (and not so) pensioners are doing.

Well help understand size Fuck you money retirement calculators.

Rule one: learn to save

According to the blog Early Retirement Extreme, the average American postpones from 5% to 15% of monthly income, but future “young retirees” should get ready to live on no more than 40%, and save and invest the rest. But when the treasured amount is in the hands, its thrifty owner is still young enough to enjoy the benefits of not having an alarm clock in the mornings and driving through traffic jams to the office.

Engineer Jeremy Jacobson from Washington State and his wife decided that their goal was complete financial independence and early retirement, when they were just over 20. They started to save 50% to 70% monthly income and continued to do so for 10 years. The income received from the accumulated amount now allows the Jacobsons to live on $ 36 thousand per year.

Rule two: be ready to part with things.

Doug Brown and Lisa Zandt worked as sales and marketing managers for a large company and made great money. But their dream was to quit and sail on a yacht, where the soul asks. They did not have time to accumulate the amount needed for the realization of the dream: the company began restructuring processes, and both reduced. Then they sold almost everything they managed to acquire: a house, cars, and other property. With the money, they bought a boat, the rest was invested. It was decided not to stay in the USA - it seemed to the couple much more interesting to travel around the Caribbean and South America and it turned out to be much cheaper than living in their homeland.

“Millions are not needed to retire,” Lisa sums up.

Rule Three: Understand Finance

Best of all, an early pension is possible for those who have taken the trouble to figure out what is there in the world of finance: real estate, the stock market, macro- and microeconomics — something that a future retiree needs to be in order to make reasonable investments.

Chris Tucker became financially independent in 26 years. He started with complete hopelessness and $ 300 in a bank account, but in just a couple of years he earned a great deal on real estate mortgaged. He buys and after a while sells small houses and apartments. Rental income covers loan payments, and subsequent sale provides additional income. The 2008 crisis of the year made Tucker think about a reserve source of income, and the young man also took up microcredit, and put some of the capital into securities.

Rule Four: Did it yourself - teach others

Becoming a successful young retiree, it's time to share the experience with those who crave information. Blogs and websites dedicated to financial independence, are very popular, and they can also earn.

Todd Tresidder quit 35 for years, having worked for 12 for years in a hedge fund. As a finance specialist, he was an ideal candidate for early retirees. He believes that the main task is to protect the acquired by overworking from devaluation. “Inflation is like a cancer, devouring savings,” he admonishes.

Todd's wife persuaded to share her knowledge with others. He wrote a book How Much Money Do I Need To Retire? (“How much money do I need to retire?”) And launched the site Financial Mentor.

Read also on ForumDaily:

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How much money must be saved annually to become a millionaire in the United States

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How to train yourself to save money: the advice of psychologists

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