How To Retire At 55

By: Michael Stevens
Published: Aug 11, 2021

How To Retire At 55 - The age of 55 might seem a bit early to retire, but it is possible with the right financial planning. In fact, there are many people leaving the workforce early to travel and do all the things they dreamed of doing while they were employed. Unless you win the lottery, you must plan and budget wisely.

I knew a fellow that retired at the age of 50. It’s enough money to pay his living expenses, but short on anything extra he wants to do. Then, I recently saw him bagging groceries at a food store. He told me he only works part-time and uses the money to travel, which I thought is a brillant idea since he doesn’t like to sit around the house all day.

Begin saving as soon as you enter the workforce. It is very unlikely that you’ll be able to retire early if you start saving in your 30s. Ideally, you should start putting away money during your early 20s.

Take a significant portion out of your paycheck. If you want to retire in your 40s or early 50s, you need to calculate how much money you need to take out of your paycheck each month. For early retirement, you should take out 20 to 25 percent.

Invest the money. A money market account may be the safest bet for someone looking for a decent return. Talk to a financial planner for additional investment opportunities.

Work part time. You can retire early from your daily grind job and choose a job that you enjoy with reduced hours. This can reduce how much you depend on your retirement savings.

Find out about any penalties that you may incur due to early retirement. IRAs and pensions typically carry a 10 percent penalty for workers who retire before the set retirement age.

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