How to Retire Early in 5 Steps [Infographic]

Retiring before age 62 is possible – we’ll show you the way.

Got retirement on the brain? If you’re like most of us, you’re wondering how to retire well and early. We’ll get you on course to your destination (we see palm trees and ocean water in your future). Here’s how to retire early in 5 steps:

The first step in our How to Retire Early infographic is an obvious one - begin to invest immediately!

1. Begin to invest immediately
It might seem obvious, but if you’d like to retire early, you need to invest now. Just be sure you have an investment strategy customized to your short- and long-term goals.

2. Answer a few key questions
The answers to these questions will help your financial advisor determine how much you should be investing monthly and annually to get ahead. Not sure how to respond? Your advisor can lead the way.

  • In today’s dollars, what do you want your income to be when you retire?
  • What inflation rate should we use? (2%, 3%, 4%)
  • At what age do you want to retire?

    Note: Since 62 is the earliest age to receive a monthly payout from social security, anyone 62 years old or younger is considered an “early retiree.” However, with smart planning, some can retire as early as their 40s.

  • What age are you now?
  • What withdrawal rate of your capital will you be comfortable using? (i.e. 4%, 6%, or 8%)
  • What rate of return do you expect? (6%, 8%, 10%) 

3. Define your risk tolerance
It’s easy to get caught up in the “Take great risks when you’re young and move to safer investments when you’re older” myth. But first, you must learn what risk means by answering the following questions:

  • What level of risk (and loss) is tolerable?
  • What kinds of risk are necessary to stomach?
  • How do you prevent the risk of losing your purchasing power to inflation?

4. Start tax planning
Learn the major differences between the ways investments are taxed and keep your eyes peeled to tax code changes.

5. Read up and read often
The early retirement game changes, but there are a few early retirement resources to put on your nightstand. One such book is The Millionaire Next Door: The Surprising Secrets of America’s Wealthy by Thomas J. Stanley and William D. Danko. Though it’s 20 years old, it remains a timelessly valuable resource for those looking to retire early in a successful way.

Have more questions about how to retire early? Contact us today to set up an appointment with one of our investment advisors, and we’ll show you how to get on track to retirement.


Recent Posts

The financial media say stocks are “volatile” and “risky” and bonds...more >>
In May of 1932, Dean Witter wrote, “Some people say they...more >>