Retirement seems like a distant goal. If you’ve made a habit of watching the financial markets, you may feel that retirement isn’t even possible at all. But with simple strategies, conscientious saving, and a few dares that pay off, these three ways to achieve early retirement will make it more possible to retire ahead of schedule.
Save Your Pennies
The road to early retirement begins with saving money while you work. Never forget that pennies add up to dollars. While this doesn’t mean that the key to retirement involves simply scooping up lucky pennies off the ground until you achieve expedited financial security, it is a gentle reminder that a lifetime’s worth of small but unnecessary expenditures will add up in the long run. Do you make a daily ritual of picking up your morning coffee on the way to work? You’re really paying for the donut shop’s utility costs. Make your coffee at home, and you’ll save money over the course of each year to the tune of roughly $1,000. But don’t just take those savings and sit on them. Use the money you save to invest wisely. By keeping more money under your control, you can retire just a little sooner. And once you do, you can splurge on all the coffee you want.
Real Estate Investments
Investing in a rental property isn’t for everyone. In fact, it’s not for most people. For most investors, the problem is not insufficient capital so much as the dedication necessary to maintaining properties and dealing with tenants. Contrary to popular belief, owning property is not merely a matter of sitting back and letting the rent checks flow in. But with the proviso that real estate investments are hard work, they can also be quite lucrative, with revenue sizable enough to shave a few years off your regular working life.
Self-Directed IRAs
By keeping your head down and following the rules, you can probably achieve a comfortable retirement right on time. On the other hand, by taking a few calculated risks and breaking some of the old rules, you can get to the finish line a little sooner. Self-directed independent retirement accounts, or self-directed IRAs, changed the game by blowing open the restrictions on where you could invest your tax-deferred money. Rather than limiting investors to traditional instruments, such as stocks and bonds, the self-directed IRA has allowed for much more creative avenues, such as cryptocurrency, promissory notes, real estate, precious metals, and just about anything you can imagine. The money in an IRA remains off-limits until six months after your sixtieth birthday, at which point you may begin making withdrawals. You may not be retiring in your forties, but that’s still a considerable jump start on Medicare and Social Security, making it one of the best ways to achieve early retirement.