Retirement is an oft-discussed topic at freefincal with a fair share of exposure to early retirement. Here is a compilation of seven such posts in the form an e-book. This is the third such compilation.
The third is on early retirement and fourth on post-retirement income generation strategies.
Retirement is typically when a person becomes a senior citizen or is just about to and stops being gainfully employed. Early retirement is when a person wants to quit a salaried job to either start a new enterprise where income is not guaranteed or wants to spend time doing things that they love, regardless of compensation
Early retirement is when a person wants to quit a salaried job to either start a new enterprise where income is not guaranteed or wants to spend time doing things that they love, regardless of compensation.
Early retirement is only independence from the shackles of a monthly salary and not the cessation of work or income from it. With enough corpus to fall back on for regular expenses, the ‘work’ can just about be anything, even nothing!
Therefore, the primary goal is to accumulate the ‘enough corpus’. How much is enough? What are the assumptions behind calculating the corpus? What are the dangers associated with early retirement? What can go wrong? How to track progress? These are some of the questions answered in the e-book.
Early retirement in India is quite different from what is discussed at popular US blogs like ERE and MMM. It is quite easy to calculate with a high real return (excess return above inflation) and arrive at a pleasing corpus. However, early retirement is fraught with many dangers. High inflation and an unlucky sequence of returns from equity can spell disaster. Therefore is it is extremely important to err on the side of caution. This compilation is an attempt to highlight such issues while also providing (links to) a list of tools to plan and track your early retirement.
Early retirement is not possible by everyone. The investible surplus (income-expenses – liabilities), along with copious amounts of luck is important to decide the health of a corpus.
At the same time, early retirement is not impossible. An onsite assignment is not necessary. Young earners who can invest with dedication for the next 10-20 years can hope to retire by age 50.