The sooner, the better. That’s what they say and this applies fully when it comes to retirement. It is obvious that nobody wants to work until they are too old to enjoy life. Needless to say a number of seniors in our country look for was about how to retire early in Australia.
While it does sound great, it is rather hard to achieve. Such an endeavour is very ambitious and it is directly tied with financial independence. Unfortunately, you need to do a lot of math before you can call it a career and head to your log cabin in the woods in order to enjoy your hobbies. Once you calculate your living costs and consult with an agent you should now have a much clearer picture about when you can retire early in Australia.
If you can cope with about $30,000 per year then you would need to have savings somewhere in the range of $750,000. The tricky part here is that if you are to spend $40,000 you will need to save at least $250,000 more meaning that your savings will need to hit $1 million. Why do we tell you that? Well, even though you are perhaps tired of society and having to go to work regularly, if you consider finding a way to somehow make about $10,000 after retirement, then you can shave off about $250,000 off your savings.
This is a huge load off your shoulders and it shows you that just a little effort after retirement can be quite useful. Not to mention that it will help you not be bored to death. Another thing you can do in order to find a way how to retire early in Australia is to save. They say that savings are just delayed expenses but so what? Savings can help with some bills and some monthly payments. This leads us to our next point – clear your debts.
Don’t even think about going into retirement if you do not have a clean financial record. Owing money to banks and institutions will get you nowhere so make sure you have repaid your debts fully prior to looking for how to retire early in Australia.
Investing is the way to go. This is a process which is the best builder of passive income. Start early and thanks to ROI (return of investments) you will enjoy a very speedy result. Compounding interest is your friend in this case and a 7% ROI per year can make quite the difference. It would take you 21 years to save $500,000 if you save $2,000/month. With a 7% ROI, that period is reduced to about 14 years. This is remarkable!
All of the above goes to show you that finding the best way about how to retire early in Australia requires sensibility on your part. You have to plan your life at a younger age as an early retirement doesn’t just happen overnight.