When can I quit my job / retire?
Just wondering, when can I quit my job / retire?
Lots of people are actively wondering how they can escape the 9-5. Escape the corporate lifestyle. We are here to tell you that the age at which you retire is ultimately your decision. It all comes down to discipline. The earlier you plan your retirement the earlier you can make it a reality.
What is retirement? Retirement is simply replacing your income so you no longer need to trade your time for money. There are many ways to create additional income sources so we will leave that up to you, but ultimately we eventually want to replace our income completely or accumulate enough wealth in a lump sum that we no longer need to work again.
There are multiple government schemes that will help supplement income once you reach retirement age and so, you’ll just need to contribute enough to your retirement fund to match the lifestyle you expect to live. The more indulgent the lifestyle the more income we will need.
As Dean mentions in his video, when you’re retired every day is the weekend and we all know that we spend more on a Saturday & Sunday than we do on a weekday. With this in mind let’s follow the two steps below to firstly determine the income needed for our fun years. We also need to determine when it is we’d like to retire. Is it at age 65 or can we afford to bring this forward? Can we simply start winding back work to part time for a few years before the big day.
Secondly when we are in retirement we need to measure and monitor our spending. If we have our money invested, it’s about monitoring the market and making sure our investment plan is on track. Alternatively if we have a big wad of cash in the bank we need to make sure we’re monitoring our purchasing power as everyday basic needs become more and more expensive over the years. Let’s get started below.
1. Set a target
When do you want to retire?
How long until you will retire? How many more years do you have to accumulate wealth?
How much do you need to live on in retirement? What’s your expected annual income per year?
How long do you plan on being retired? 30 years?
2. Track our progress
Now that we understand the goal (when we are going and when we need to be there) we can start to measure the progress. Let’s reverse engineer it. If we need to accumulate $100,000 over 10 years it’s pretty simple to work out how much we need to save each year to make that happen. If the savings are looking unrealistic and we need to leverage our money to create an additional income source - now is the time investigate further. Do you need an investment plan to help you get to your goal faster? Are you willing to take on some risk in order to make your goal become a reality?
If this is the case and you’d like some investment advice feel free to get in touch.
Signing out for Money Week
We hope you’ve enjoyed watching our videos as part of Sorted’s Money Week this year. As always if there are any further questions you have or would simply like to catch up with Dean for a coffee, please feel free to get in touch. Oh and don’t forget to sign up for our 4 part Online Bootcamp via that link below. If you’ve enjoyed Money Week then you’ll love the Bootcamp Series.
If you’ve missed any of the previous videos please follow the links below.
Monday - What is Money Week?
Tuesday - How do I start a plan?
Wednesday - Do I earn enough to become rich?
Thursday - How to survive the remainder of Covid-19
Friday - When can I quit my job / retire?
Online Financial Fitness Bootcamp
We’re also using this as an opportunity to invite people to sign-up to our FREE online financial bootcamp series – going live in September – click below to pre-register for your spot.