Early retirement is quickly becoming an important aim in people’s ‘life goals’. There’s a growing number of people in their 30s and above looking beyond coping with the daily financial struggle and finding a way to become financially independent and able to enjoy retirement at a much younger age. Known as the ‘financial independence, retire early’ (FIRE) movement, there’s a growing community who are bucking the trend and making it work.
Is it even possible to retire early in today’s climate? If you’re willing to work hard, save a lot and reap the rewards later – read the following to find out more about how it’s done.
The FIRE movement
The FIRE movement is a growing lifestyle mainly made up of millennials who are looking to give up the daily grind and retire at an early age. The lifestyle requires a degree of frugality, and a willingness to save a large portion of your earnings. This enables followers to invest their money to benefit from the proceeds further down the line. Rather than being a focus on how to earn more to be able to spend more, the aim here is to live comfortably on less. The time spent not working can be used to pursue other interests and ventures, without worrying about relying on them to survive.
The movement has many dedicated followers who communicate through Reddit, while there are also many influential bloggers finding success through this lifestyle. Take a look at Mr Money Mustache for some great insight into the FIRE movement, as well as some practical savings tips.
Becoming financially independent and retiring young
In order to become financially independent at a young age, you’ll need to tighten your spending. Some things you can do include:
- Cutting back on everyday expenses, including saving money on your groceries, transport and most luxuries.
- Focus on saving as much as possible, as much as 50-60% of your income. This is easier if your salary is generous in the first place.
- Track your spending so that you know where all of your money is going.
- Find ways to cut back on socializing, taking advantage of deals and think of ways you can socialize for less – not everything has to involve a night on the town.
With your growing savings, you can start investing your money to provide further income as you look to retire. Retirement investment expert Sid Miramontes regularly hosts webinars to help people better manage their retirement assets, providing advice which could benefit you in the future.
Real estate is another popular area of investment, and investing in property could help provide you with the income you need to live comfortably post-retirement. Even those without knowledge of investing can learn to make sensible investment choices, and speaking to experts can help.
While the measures needed to retire in your 30s are on the extreme side, you can still focus on enjoying a comfortable retirement through focusing on savings and growing investments. Discover more about building wealth and start putting your financial future in place now.