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It might can be the most common cubicle daydream: basically early retirement, and the freedom u2014 financial and otherwise u2014 that comes with it.
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THE FINANCE BFF An Easy Guide to Early Retirement
Make Some Adjustments To Your Current Here’s where that work really comes in: No matter how you want to slice it, retiring early means making some changes to how Current You earns and spends money, so Future You gets to relax. And for many people, that really means cutting their budget to the bare minimum. Budget
Calculate Your Annual Retirement Spending Translates into needing less money for retirement — the assumption being you’ll also continue to do so. Always prove that out by putting together a retirement spending estimate. So, to do that, take a look at your current monthly spending and consider what will go down, what could go up, and what might be added or eliminated altogether.
Estimate Your Total Savings Needs The work you already did to nail down spending already has you halfway through this one, thanks to a couple of rules of thumb widely used by early retirees. The first is also the rule of 25: You should have 25 times your planned annual spending saved before you retire.
Invest For Growth At the risk of stating the obvious, retiring early actually means (1) you have a shorter period during which you can save, and (2) you have a longer period during which the money you’ve saved needs to support your spending.
Keep Your Expenses In Check You’ve done a fair amount of work estimating how much you’ll spend in retirement. The harder job will be actually sticking to that estimate.
