financialtreat – will explain about The Early Retirement Financial Independence Tips that you will get in the following article. let’s look at this article carefully!
Never thought about taking the step of retiring early. has the desire to walk the way to Europe with his wife and relatives, enjoying a pleasant old age without having to drag on in the problems of the hustle and bustle of the city. It’s fun isn’t it. therefore I will provide information about Early Financial Independence and its steps.
Financial Independence early retirement. This desire is not as easy as you might think because it needs careful planning. If you want to make the decision to retire at an early age. then this review can be a guide in managing good finances.
Tips for Financial Independence for Early Retirement
As we reviewed above. To be financially independent, this pensioner needs a step that we must take, explain how this step is. Here are some things you guys should do.
1. Write Your Plan
There are so many ideas we think about inside the brain. However, it would be better if we recorded it. When we record the plans we want to do, it not only tells our planning into the subconscious, but also makes it a motivation to live the days well. Without a real plan, all bright ideas will only be a dream that expects good luck or hockey.
From now on, Career Advice colleagues should establish that, “I want to be a happy early retirement person. Enjoying my old age without asking others for money and without causing trouble to those around me”. For example, financial planning, in June 2019, my old age savings had to reach 20 million rupiah.
We must remember that financial success is an option. Every financial decision we make every day will determine whether we will be closer or further away from our desired financial goals.
2. Learn to Be Financially Literate
Of all the plans and bright ideas we have. It would be nonsense if we took an action without the theory or science underlying the action, right.
Before we move forward to realize all our planning, the thing we have to do is be financially literate. There are several economic terms that we need to learn such as, inflation, which is a process of increasing prices in general and continuously related to market mechanisms that can be caused by various factors, ROI (Return on Investment) which means the ratio of money earned or lost on an investment, and so on. We don’t need to be a bachelor of economics or business, but at least ‘literate’ or understand financial science, so it will be easier to manage financial planning.
3. Don’t Be Consumptive and Avoid Pretending to be Rich
In today’s sophisticated age, there are millions of people who look rich, but in fact they are not wealthy people at all. They are just consumptive people, buying luxury and expensive things by relying on their credit cards, so that when they wear them in public, others will label themselves as rich people.
Getting rich is a long-term goal, something that is realized only in the later stages of life. This clearly implies that we must abandon the luxury of today if we really want to realize financial success in the long run. Being consumptive will never make us rich. We must be wise in removing every coin and sheet of rupiah from our wallets.
4. Make Our Money Hard to Take
Don’t keep our money in an easy place to take. For example, avoid taking excessive cash at atms and storing them in wallets. For some people, this is very dangerous. Money is like water, it can flow out of thin air. Without good control, we will find it difficult to control the existing finances.
Try to invest our money in the form of storage that is difficult to disburse. For example, make a deposit in a bank or buy gold bars that we can keep. So, when we need money, we will think more about cashing it out, “Hmm, it seems like it’s a pity if the gold is sold, hold it up first and buy the new bag”.
5. Start Saving from Today
As discussed earlier, getting rich is a long-term goal. So, if we want to have a happy old life, do not delay to save as early as possible. We can start saving from a small nominal to a fairly large one.
Still remember the phrase that we often heard when we were young, “little by little, it will eventually become a hill”. It’s okay to save little by little, as long as it is consistent, and we will enjoy the results in the future.
6. Don’t Forget to Write Every Expense
It is often taken for granted by many people. Especially when we have to write every small expense that is only about a thousand to ten thousand. For example, Rp 2000 for motorbike parker money when buying cakes, you don’t list.
Just imagine if a fellow reader went to the cake shop several times and didn’t write it into the spending budget. Hmm, this will cause a confusion at the end of the month. So, would it be better if we wrote down every small or big expense so that we can also learn, what are the expenses that can still be on the ‘brake’ and those that can’t.
7. Have a Source of Passive Income
The price of goods is getting more and more expensive. Not only that, but the cost of education and health is also looming. This requires us to have other sources of income, because the income earned from working in the office may no longer be able to cover all the needs that exist.
The solution is to have a source of passive income. It’s okay to have luxury cars like Ferrari, Lamborghini, etc. Try renting the car into a wedding car or for a paid exhibition.
It’s okay to have a luxurious and good apartment, but rent out the apartment, place an ad on sites like AirBnB. Have excess soil? Create a building for renting, this will be much more beneficial for our finances.
8. Planning the Risks That Will Be Obtained
The higher the risk, the higher the return”. However, this does not mean that we should be vying for high-risk investment opportunities, without careful thinking. Based on financial health, the risks that can be taken by each person will be different.
Therefore, we need to evaluate our financial health and our ability to bear losses. This will give us a clear picture of the risks we are capable of taking in the long run.
9. Financial Independence: Don’t Tinker with Social Security
If career advice readers have insurance or social security. We advise fellow readers not to tinker with it, no matter how difficult the conditions are. No matter how big or important our needs are, touching social security should always be a last resort.
Ideally, social security is used after retirement. The longer we wait to claim social security, the better it will be for our retirement later.
10. Stay Healthy
Healthy is expensive. Yep, this expression is very true. Let’s see, how many luxury cars are pacing back and forth into the Hospital because the owner has had a long illness, for many years.
This is not only painful, but it can also drain the savings we have saved for many years. So, let’s both take care of our health from now on, so that we have a body that is always healthy.
11. Plan Taxes As Best You Can
As good Citizens of Indonesia, we need to carry out one of our obligations, namely, paying taxes. Tax planning will also become relevant after retirement, which is why we must be careful in making investment planning, since all the investments we have will also be taxed.
Read more financial independence:
- The Importance of Financial Stability in Life and Its Benefits
- Financial security Here’s How to Be Financially Secure
12. Buying a Used Car Is Not a Bad Idea
In fact, cars usually lose about 20-30% of their value (depending on the brand and model) in the first few years due to depreciation. We advise Career Advice readers to buy a used car only (of course, with a car engine that is still good). This is by no means a bad idea.
In fact, this is a wise decision because used cars must have been depreciated. If we plan to retire early, it is better to invest in building assets than to buy liabilities.
Thus the review of the Financial Independence of Early Retirement. This way of managing our finances so that we can have a happy old life. If you want to do it. it is not wrong to follow the steps we are free to follow above.