How to retire early is a question asked by many people many times during their lives.
Unfortunately it is not achieved by too many people in terms of the concept of traditional retirement of stopping work and having sufficient income to just potter around day-to-day.
However the concept raises two interesting points what does "to retire" and "early" mean to you?
What does it really mean?
The few people who achieve the financial means to be able to retire early are usually the ones that are driven. They have the FIRE!
They have established a career or business, not just to make money, but as a passion and life mission. There is another group that achieve the financial means early in life which includes sportsman or entertainment celebrities.
The final category of people who can consider early-retirement can thank their fathers or grandfathers for their adequate legacies.
However retirement does not fit the traditional concept for a large group of people. Those who have decided that the corporate lifestyle, or first world environment living, can be replaced by more laid-back lifestyle. There's a growing number of people who decide to move abroad in pursuit of this ideal. They do not consider it as an escape but to open up new opportunities and choices.
Although in some cases this is considered retirement, it is really just a lifestyle change. A lifestyle that provides more freedom, more flexibility of time, and possibly the opportunity to have a portfolio type lifestyle.
The internet providing a fantastic opportunity to generate an income for these so-called 'retirees.'
The Rules for How to Retire Early
If you are not exceptionally driven, or a world class sportsman or born with a silver spoon it is also possible to consider early retirement by following a few simple rules:
Minimise debt or use it wisely
Take on as little debt as possible throughout your life. Live your life within your means. Even if this doesn't provide all the financial resources it will teach you the financial fundamentals you will need for an early retirement.
Don't waste money keeping up with the Jones'
Reduce expenses where ever possible. It is not necessary to keep up with your friends, neighbours or colleagues driving the latest car and living in the fanciest house.
Learn about investing. Traditional retirement funds and investment vehicles are never going to make anybody wealthy enough to retire early. Don't follow traditional methods or you will get traditional results … not much! It has been calculated that costs wipe out most of your real returns. These costs wiping out as much as 75% of the real value of your retirement savings in a 40 year period.
Have your own business
Start your own business. Having a successful business is an excellent hedge against inflation and wild fluctuations in the stock market. In addition it is an effective way to build capital value.
It is also useful to remember that this idea is the gist of the quote "If you want to be rich, don't rob a bank start a bank."
So the answer to the question "how to retire early?" generally depends on your luck or redefining the meaning of retirement.
To achieve this status requires great ingenuity and drive and when you achieve it - it's unlikely that you're going to give it up and retire!