Saturday, September 7, 2013

Is Extreme Early Retirement The Right Choice For You?

Have you ever been so fed up with the grind of the daily rat race that you thought about tossing in the towel - wishing that you could just retire even though 65 is a long ways off? If you have, then you may be a candidate for extreme early retirement.

More and more people are considering retirement before 50 - some even retire in their 30s. Many people consider extreme early retirement because they are burned out on their current careers. Others just want to drop out to pursue their true life's calling. Whatever the reason though, the appeal of extreme retirement can be great - but it may not be for everyone.

One of the very first things that you should consider is the other people in your family and how extreme retirement would affect them. Though it isn't impossible to retire very early with children, it certainly does complicate the picture. You will have to give some careful thought to the sacrifices they may need to make because of your decision. Is your partner on board with the idea? How will your decision affect all your other family members? If your plan is to generate an income from some other source rather than a regular day job, it may take time to build your business up. Depending upon your choices and dedication to your new ventures you may make a significantly less amount of money for a very long time. You may never match your old income - or - you may wildly exceed your expectations and make a lot of money. This brings me to a second consideration - uncertainty.

If you can deal with uncertainty, then extreme retirement may be for you. However, many people do not like uncertainty and should avoid it if it generates too much emotional stress. Will you be able to deal with the uncertainty of an unstable income? Can you deal with the uncertainty of how you will spend each day or will the days just drift by you aimlessly? One of the biggest adjustments that an extreme retiree will need to make is the sudden lack of structure to each day. Although most people hold the fantasy that this will be a wonderful thing, many find it tough to deal with because they end up doing nothing day in, day out and then rapidly fall into a funk, leading to depression.

A third factor to consider is how to deal with family and friends when you retire early. Will you be ready for their criticisms and worries? Well-meaning family (especially moms and dads) can really wear you out about a decision that they cannot understand and think is financial suicide. If you can show them that you have thought things out, have a plan and understand their worry you will be better able to deflect a lot of their concerns. Friends may be overly critical because they are actually jealous of your bold decision to take an extreme early retirement. Think about ways to deal with all the naysayers that you will encounter before you reveal your plans.

Once you've given some careful thought to these issues you will have made the very first steps to deciding what is right for you and living the life that you want. Cutting back on expenses and learning to live frugally will be part of your plan too, so be sure to check out the links in my Bio box below.

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