6 Smart Strategies for Retiring While You're Still Young Enough to Enjoy It

retiring earlyUnless you're in a job you absolutely adore, it's hard not to every once in a while mentally fast-forward and fantasize about your future retirement.

Unfortunately, for many of us, the days of waking up whenever we feel like it and spending our time exactly as we please seem impossibly far off. It almost feels cruel that we'll only get to enjoy retirement in the twilight years.
But, what if you were willing to make some sacrifices now to enjoy the blissful carefree days in the not-so-distant future?
Cameron Huddleston, Life + Money columnist at GOBankingRates, acknowledges that while retiring at 40 might seem like a fantasy, plenty of people make it happen without a lottery win.
"It doesn't happen magically, though. It takes a lot of planning and some sacrificing," notes Huddelston, who shares her top six strategies for being able to hand in that resignation letter soon than you'd think. 
1. Learn to love saving more (and spending less)
"Financial experts typically recommend that people save 15 percent of their annual income in order to have enough for a comfortable retirement," the personal finance expert says. "However, that assumes retirement around age 65.
"If you want to retire by age 40, you need to save a lot more than 15 percent -- most likely 40 percent to 50 percent of income. And you'll need to invest the money you're saving in assets that offer the potential for growth, such as stocks, stock mutual funds, or index funds that track stock indexes."

So, if you can swing it, start socking that money away in a place where it can build on itself. (In other words, no more piggy banks or stashing it under the mattress.)
2. Live on one person's income

This one may sound like a stretch, but plenty of couples make it happen.
"If you're married or live with a significant other, you can quickly build a nest egg by living on just one person's salary and saving the other's income," Huddleston notes. "This might seem extreme, but I know couples who have done this with the goal of retiring early. You might find that you can get by on just one person's income but that you've been spending both of your salaries because of lifestyle inflation -- spending more as income increases."

It makes sense, right? When more money is coming in, you start to spend more, sometimes believing you deserve a reward for your hard work, but often just because you can. Rein it in and think long-term!
3. Start a side hustle

OK, so you're willing to save more, but then you find yourself wondering where exactly that extra cash is going to come from, right? Huddleston shares some advice for bringing in more capital.

"If you want to set more aside in savings, you might have to find a way to earn more. You should consider a second job, a side hustle such as driving for a ride-sharing service or freelancing."
For example, you could get a seasonal job every holiday season when retailers, restaurants, and delivery services hire extra workers. Or, if you're a master at WordPress, you could help set up blogs on the side for wannabe bloggers.
"Keep in mind as you're working extra hours that the time you're putting in now will soon offer you more freedom."
And, really, is there anything better than freedom? 
4. Invest in some real estate

If you've got some money saved but feel that it's not growing at the rate you'd like it to, it might be time to look at other options. 

"Plenty of people invest in rental properties that provide a stream of passive income for retirement," Huddleston says. "Of course, you'll need money upfront and possibly a loan to get started in real estate investing. But if you do your research by talking to realtors who know the market and can tell you which properties should offer a good return, and by educating yourself about real estate investing on sites such as BiggerPockets.com -- your investment can pay off."
The financial journalist shares that she recently interviewed a woman who was able to use real estate investing to leave her 9-to-5 at the age of 29. Impressive!
"She got started with a $400,000 rental property that she bought with a 25 percent down payment and borrowed the rest," Huddleston explains. "Then she bought two more properties with cash. She now makes enough money through passive income to cover a low-cost lifestyle."
Is it wrong to say we're green with envy?
5. Cut out every (and we mean every) unnecessary expense

As hard as it is to hear, you had to know this one was coming, right?

"Would you rather watch cable TV every night after a long day of work or stop working entirely by 40 so you can do what you enjoy every day?" Huddleston asks.
"Cable TV is just one of many unnecessary expenses you can eliminate from your budget now so that you'll have more cash each month to stash in savings. You don't have to have the latest iPhone. Buy a cheap phone with the cheapest service plan you can find. Resist the urge to buy a new car, and drive the car that's paid off as long as possible. Pack your lunch and eat dinner at home. Stop subscribing to magazines that are just piling up on your coffee table. Scrutinize your spending to pinpoint every unnecessary expense that can be cut."

6. Downsize -- or resist the urge to upsize

"Some retirees move to a smaller home to cut housing costs in retirement," Huddleston notes. "But you shouldn't wait until retirement to reduce what likely is your biggest expense.
"Perhaps you moved to a bigger house once you had kids. But do your children really need a bonus room in addition to having their own bedrooms? If you have too much house, you can lower your monthly mortgage payment and other costs such as utilities and taxes by downsizing to a smaller home."

While we're not suggesting you join the tiny home movement, you may want to reconsider if you're thinking about expanding.
"If you're thinking about moving to a bigger house, you should resist the urge if retiring early is your goal," Huddleston says. "Every dollar you save on your mortgage and put into a retirement account instead will bring you closer to retiring early."
Sounds like a plan. Follow these strategies as best as you can, and you'll be the youngest person at the early bird special!
Image via SydaProductions/Shutterstock
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