Posted on 03/28/2018 6:52:51 AM PDT by SeekAndFind
Countless workers dream of retiring early and reaping the benefits that come with it. But many folks don't pursue that objective, either because they're too scared to take the leap or are worried that they're not financially ready. Both are valid lines of thinking, but the problem is that the longer you wait to retire, the longer you'll miss out on the lifestyle you really want. If you've been on the fence about early retirement, here are a few good reasons to take the plunge.
Americans certainly aren't strangers to hard work. Collectively, we tend to forgo vacation time, put in long hours, and sacrifice our work-life balance to prove our worthiness on the job. If that's been your routine for the past, say, 40 years, and your savings will suffice in allowing you to pay the bills, then it's about time for you to call it quits.
Now most seniors are told that they can safely expect to withdraw 4% of their retirement savings each year and not risk running out of money. If you're retiring earlier than the average senior, however, then you'll need to adjust that withdrawal rate downward. But if your nest egg is healthy enough, that may not be a problem.
Imagine you're looking at a $2 million nest egg. If we apply a fairly conservative 2% annual withdrawal rate, you'd start out with $40,000 of income. Now, that alone may not be enough to live on, but if you're married and both you and your spouse can start collecting Social Security, that might add another $40,000 to the pot. Suddenly, you're looking at $80,000, and that changes the picture tremendously. Furthermore, if you have another source of income, like a rental property or side business you plan to pursue, then you have even less to worry about moneywise.
Of course, not everybody is in a solid financial position to retire early. But if you've done a good job of saving, then frankly, you've earned the right to leave the workforce ahead of schedule. And you shouldn't feel guilty about that in the slightest.
Though studies have shown that retirement increases the risk of suffering from depression, working full-time might harm your health in other ways. If you have an office job, being sedentary for the bulk of the day could put you at risk for musculoskeletal disorders, obesity, diabetes, and heart disease, to name a few.
Furthermore, the majority of U.S. workers today don't get an adequate amount of sleep, which, over time, can increase your risk of early mortality. And if your job stresses you out more often than not, you could increase your chances of heart disease, anxiety, and, yes, depression.
Now if you happen to love your job and find that it serves as an outlet for being active, then that's reason enough to stay. But if you're among the 52% of Americans who identify as being unhappy at work, you may want to make your exit sooner rather than later.
The average 65-year-old man today will live until 84.3, while the average 65-year-old woman will live until 86.6. But will you make it to your mid-80s or beyond? Maybe. The fact of the matter is that you just don't know, and that's reason enough to retire as soon as you're able. Even if your health is great at present, it's impossible to say when things might start to deteriorate. Heck, you could walk out the door tomorrow and get hit by a bus, and suddenly, there go your retirement plans.
Of course, this isn't to say that you should be scared to leave the house, and looking both ways before venturing out into the road will reduce your risk of the aforementioned scenario. The point, however, is that none of us have a crystal ball to tell us how much time we have left on this planet, so if retirement is something you've been eager to experience for a long time, you might as well go for it.
Though early retirement isn't for everyone, if it's something you want, then march into your manager's office, submit your two weeks' notice, and get ready to pursue the lifestyle you deserve. Chances are, it'll end up being the best decision you ever make in your lifetime.
4. You’ve pulled the welfare wagon for forty-five years.
4. You’ve pulled the welfare wagon for forty-five years.
...
Paying the bill for the votes Democrats are buying.
Just another tip: whatever amount you THINK you need to retire on, double it. I’m speaking from experience.
To my mind, #3 argues for sticking it out and drawing a paycheck as long as you possibly can....
I’m retiring on Friday. Woo-hoo!
Only a few years left.
Despite the recent wild ride I have enough to retire very comfortably — I could now but I have a specific goal.
After working 40+ years I can use the break.
Note to youngsters: Start saving for retirement YOUR VERY FIRST PAYCHECK. Social Security, if there at all, is subsistence living at best.
I didn’t start saving until I was in my 30s. Had I started when I started working I would have retired years ago in my late 40s or early 50s!
Am I missing something here?
Why assume a "withdrawal rate?" What about investing the $2 million in a diversified portfolio that earns, say, 4% annually? Won't that give you $80,000 without withdrawing any principle at all?
-PJ
I thank the Army regulation that forced me to retire at 62. Seven beautiful years since.
Retired means retired; let someone else climb up to Machu Picchu.
Ah...time for my midmorning nap...my couch beckons...signing off.
;^)
Congrats!!!!!!!!!!!!!!!!!!
I’ve retired early and for me the most important thing, something that these guys never seem to say is buy a house and get it paid for. Do not go into retirement with a mortgage or rent. It is almost always a persons biggest monthly expense. It’s amazing how much less income I need now that I’m not workiing
I retired at 62 and its worked out well for me.
Can’t believe how many of my graduating class have already passed.
Many were the outstanding students and athletes.
>>Why assume a “withdrawal rate?” What about investing the $2 million in a diversified portfolio that earns, say, 4% annually? Won’t that give you $80,000 without withdrawing any principle at all?<<
That is the theory but planning is to draw it down and assume no return. For TSA-type investments you have to take withdrawals anyway.
RE: What about investing the $2 million in a diversified portfolio that earns, say, 4% annually? Won’t that give you $80,000 without withdrawing any principle at all?
As long as you are not going to lose sleep over the huge swings and the ups and downs of the markets ( e.g. the downs of the mortgage crisis ), then have at it.
Most retirees do not have the stomach for this and would prefer steady, predictable income.
I’m in my 70s. I still work a full time job. I don’t know how long I will live, but lots of family members are 20 or more years older than me. My aunt, 16 years older than me, jogs and teaches aerobics. I’d be afraid of running out of money if I retired now.
>>I’ve retired early and for me the most important thing, something that these guys never seem to say is buy a house and get it paid for. Do not go into retirement with a mortgage or rent. It is almost always a persons biggest monthly expense. It’s amazing how much less income I need now that I’m not workiing<<
Great advice. I paid for my house last year and will be going into retirement debt-free.
As should everyone. If you have debt you are not really retired.
If you retire at 62 you pull less from social security. If you don’t need it, this is a good way to help ease the system.
The future is unknown: Out of my last six small office jobs, six coworkers have died in the past 10 years. All were younger than me. Most were 40s, 50s and early 60s. This is the best reason of all to retire early. I'd rather survive on ramen noodles than have no retirement at all.
And yes, that is my plan, too. However, I'm also factoring in some market return to be included, and not just assume a drawdown without additional investment earnings.
Also, there is the benefit of not paying $10,000 into Social Security and Medicare taxes anymore.
-PJ
Woohoo! Congrats! I retired at 58 and have never regretted it.
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