Tips for a Great Early Retirement  

     It is every worker’s dream to just relax on the beach, swing a nine iron or putter in garden and not worry about having to go to work or dealing with work related stress.

      But retiring early does not have to be a distant dream. If you have planned well and saved up enough money, you can spend the entire day lolling around in your Bermuda shorts!

       In order to retire early, you must take into account that you will most probably have 30 or more years to spend blissfully without worrying about going to office. Therefore, everything should be planned and worked out so that few years after an early retirement, you are not back in the job market. Therefore, now is the time to start thinking about how to take your pension, set up Social Security and what you will do with your time.

        Here are some tips to have a great early retirement and it is ultimately in your hands to ensure that you enjoy the rest of your live in relative peace and calm.

Pension Payout :

          Before you retire early, you need to think about pension payout. You will need to decide whether you want your accumulated pension in a lump sum or as a monthly payment. It is best to talk this over with your financial advisor as there are many things to consider.

          Annuity payments are usually preferred by people as they last a life time. You can take a high monthly payments now and then have the payments end when you die or you can take low payments now and have them continue to your surviving spouse after your death. Remember survivor benefits are usually half of what you will get but something is better than nothing.

Social Security :

          It is best not to retire as the Social Security payment is based on the average of your best 35 years of work which is adjusted for inflation. However, if you retire too soon, those 35 years will be taken as zero and this can drastically reduce the Social Security you receive.

          It is best to wait to collect your Social Security regardless of when you retire. You can start collecting your Social Security when you reach 62 but will be fined five-ninths of 1 percent for every month you are younger than 65. This works out to getting 20 percent less per month if you collect your Social Security at 62.

Inflation :

          Before you throw in the towel, make sure you have added the inflation into your retirement benefit. It is common to take a 3 percent hike for each year and add that to your retirement plan. For those who do not take into account inflation, usually get a rude shock. For instance, if you require $50,000 a year to live on, without take the inflation factor, this amount will be worth just $48,500 the next, $36,871 in 10 years and $27,189 in 20 years. There is a big difference living between on $50,000 and $ 27,189 especially when your expenses might not get cut into half 20 years down the line.

Tips for a Great Early Retirement






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