Why I Am Planning My Retirement Now?
I just witnessed my dad’s retirement yesterday and here’s why I think I need to retire early
My dad superannuated on Jan 31, 2024 and honestly, I am happy for my parents. They would get to spend a lot of time together; doing things they always wanted to do but couldn’t. They could go on long walks, have never ending talks, pay visits to family and friends without worrying about the office leaves, throw parties, take long vacations…
Everything seems like a fairy tale, right?
Alas, it’s not!
A person who has worked all his life, till 60 years of age is suddenly asked not to show up to work anymore. This pinches my dad and I can see it very well in his eyes.
As middle class family head, he put his family and children before him and never much thought of the final day.
Now, don’t get me wrong. It’s not like we’re financially struggling. But it’s the mind & body that needs to be convinced.
I can happily say that my father will be working part time. This may be a pay way below the actual salary used to be. However, the fulfillment will be higher than ever before.
And that’s the point. Retirement planning is crucial, not just monetarily.
It must be mostly about envisioning and creating the life you want after your working years.
I am sharing the methods my parents opted for so that they can stay engaged and connected to prevent boredom and isolation.
- Vision definition.
Be realistic about your age, financial situation and desired lifestyle. Now build your finances to support this lifestyle and aspirations.
Factor in housing, expenses, healthcare, and potential inflation are the bullets your savings and investments need to dodge. - Assessing Finances.
Arrive to a definitive figure or a range using a financial calculator or financial advisor.
Track your spending for a few months to get a clear picture. Also account for any potential gaps between your income and expenses.
Identify sources of income after the job; Social Security, pensions, investments, part-time work? - Develop a Savings Plan.
Maximize contributions to employer-sponsored retirement plans. Many offer employer matching, essentially free money!
Automate contributions wherever possible to stay on track.
Consider other investment options like stocks, bonds, or mutual funds. Seek professional advice to diversify your portfolio and manage risk. - Prepare for Healthcare.
Life throws curveballs! Review your plan regularly and adjust as needed based on life changes, health, or market fluctuations.
Have a solid healthcare plan to not rip apart your bank or plans for family. - Start early.
My parents started planning even before ‘early retirement’ was a rage.
For better time and compound interest growth, The earlier you start, the easier it is to reach your goals.
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