Achieving your dream of early retirement
Spending more time with your family. Picking up a brand new hobby. Exploring exotic destinations. However you paint it, retirement is a beautiful goal to work towards, and starting early means you’ve got more time and energy to enjoy it.
Unfortunately, wanting it doesn’t mean you’ll get it. Most cannot afford to hang up their tool belts and briefcases early. There’s a big disconnect between those who want to retire early, and those whose finances will allow them to stop work. So how can it be done?
It’s interesting to note that those who successfully retire early aren’t just lucky, or from wealthy backgrounds. They are people who foster habits that allow them to build their wealth sustainably over time. Here’s a few things that early retirees have in common:
- Mindset: Have discipline necessary for saving. Consistently choosing to save rather than spend – plus compound interest – means that real wealth is built over decades.
- Long term goals: Early retirees are more likely to have set long-term goals and focused on them. There’s a psychological reason that makes this is difficult for many people. Our brains are hardwired for instant gratification and it doesn’t just affect our propensity to snack or hit the sales. Anything we can see, or at least visualise strongly, is much more attractive than anything that’s too far in the future to picture.
- Have a united approach: Good habits in saving and goal setting are more effective if they’re shared by your spouse. A spender can undo much of the good work of a saver, even if their finances are not completely intertwined.
- Get advice: Of course I am biased about the importance of getting advice. But studies have shown that those who retired early were more than twice as likely to have worked with a financial professional. So if you want more help on making your early retirement dream a reality, get in touch with a financial planner and start putting your dreams into action.
Principal Wealth Management Pty Ltd trading as BMO Financial Solutions ABN 53 109 336 601 is a Corporate Authorised Representative of McPherson & Associates Pty Ltd Australian Financial Services Licence (AFSL) 229883. Before making any financial or investment decisions, we recommend you consult a financial planner to take into account your particular investment objectives, financial situation and individual needs. McPherson & Associates Pty Ltd and its Authorised Representatives do not accept any liability for any errors or omissions of information supplied in this article.
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