Lifestyle Sacrifices If You Want Early Retirement
If you want to take early retirement but can’t afford to, it’s probably because you only have yourself to blame.
Early retirement for Expats in UAE, UK and Australia is an achievable goal for many but it doesn’t come without some lifestyle sacrifices.
That means you literally can’t have your cake and eat it where spending is concerned.
Instead, you need to pay your debts and manage your money.
So, if you want to retire young, here are some points to consider from as soon as you start work for your early retirement.
Rapidly settle your debts
The concept is you are borrowing against future income to buy something now, instead of waiting until you can afford the expense. Making minimum payments stretches the lifetime of a debt, adds to the cost and siphons cash that is available for saving.
Spending more than you earn
If you live beyond your means, nothing is left for saving and the inevitable result is sooner or later your credit will run out, leaving you with a financial millstone to repay. If you spend too much, take an honest look at your lifestyle and start making some cuts even if it means going with a holiday or some treats for a while
Living a life you can’t afford
This is deceiving yourself by keeping up with wealthier friends and colleagues when you can’t afford to. Signs are renting a home in an expensive neighbourhood, dressing in designer clothes and eating out in posh restaurants that are above your pay grade
Paying people to do your stuff
If you fork out for cleaners, gardeners, the laundry and car valeting, you can immediately save some cash by doing these jobs yourself
Don’t lock in all your savings
Tax relief on pensions is a good deal unless you need to access the money. You need cash on hand to pay the bills in an emergency, such as falling ill or losing your job. Consider saving some as cash every month and pay in a lump sum at the end of the year if you have more money than you need to survive for six months without an income
Factor in your lifestyle choices
Bringing up a family will hit your saving plans and means adjusting timelines and how much you put into the bank and pension – and the more children you have, the longer you will need to work.
At credence, we have many plans and advices for early retirement, get in touch with us if you`d like to learn more.