The first step is to calculate how much you will need to retire early. The answer is difficult to determine and depends on the following factors:
-Your monthly or annual expenses in retirement
-How long you plan on living, which influences what income level you need in retirement – the longer your life expectancy, the higher your desired income level should be
-The time horizon for your retirement savings – the longer you have for your investments to grow, the higher your desired income level should be
-Your earning potential after retirement (if you plan on starting your own business, for example)
-Your desired financial security level (i.e., how much money you would like to have available should a worst case scenario occur)
-Your risk tolerance – risk tolerance is a measure of how comfortable or uncomfortable you are with market fluctuations of your investments, where ‘high risk’ means being willing to take more risks in exchange for greater returns, and 'low risk' means being uncomfortable with significant losses in exchange for lower gains
-Tax implications of working in retirement and/or distributions from retirement accounts.
We are not financial experts and cannot provide an accurate estimate. But if you take the simple average of our Inputs, it is easy to see that you can become comfortably financially secure if your monthly expenses are less than $8,300.
Generally speaking the higher your income(s), the higher your desired retirement income level will be. However at some point, you begin reaching diminishing returns: The extra money that you make from being able to work when you want to isn't worth as much as working when you don't feel like it or don’t have any other option among your job positions because of health issues.
-Your monthly or annual expenses in retirement
-How long you plan on living, which influences what income level you need in retirement – the longer your life expectancy, the higher your desired income level should be
-The time horizon for your retirement savings – the longer you have for your investments to grow, the higher your desired income level should be
-Your earning potential after retirement (if you plan on starting your own business, for example)
-Your desired financial security level (i.e., how much money you would like to have available should a worst case scenario occur)
-Your risk tolerance – risk tolerance is a measure of how comfortable or uncomfortable you are with market fluctuations of your investments, where ‘high risk’ means being willing to take more risks in exchange for greater returns, and 'low risk' means being uncomfortable with significant losses in exchange for lower gains
-Tax implications of working in retirement and/or distributions from retirement accounts.
We are not financial experts and cannot provide an accurate estimate. But if you take the simple average of our Inputs, it is easy to see that you can become comfortably financially secure if your monthly expenses are less than $8,300.
Generally speaking the higher your income(s), the higher your desired retirement income level will be. However at some point, you begin reaching diminishing returns: The extra money that you make from being able to work when you want to isn't worth as much as working when you don't feel like it or don’t have any other option among your job positions because of health issues.
