A government would be considered intolerable if it taxed people 10% of their time in service of the government. Yet idleness taxes many of us much more if we consider all the time spent checking email, our phone, social media and news feeds. All these activities add nothing of value to our lives or to those around us and is no worse than the government taxing you a percent of your time.
Retirement is the one universal goal. Some plan for a traditional retirement while others dream of cutting their own trail sooner. Early retirement is a worthy goal and achievable with a modest amount of planning.
There are 10 things to consider before you submit your resignation. If you cover each issue properly early retirement will fulfill your dreams. Poor planning could put you back into the workforce.
The map below is a handy guide for your journey. Click on the map to enlarge and print. This map, along with the information below, can have you enjoying early retirement in record time.
Having money can change you, and not always in good ways. The risk is greatest for those who start out poor. For those lucky people, they have an additional challenge before them. If they fail they go all the way back into the swamp.
Money doesn’t make you a better person; it makes the kind of person you are more pronounced. If you are a kind and generous person, money will tend to make you more kind and generous. And if you are a a-hole, money will make you a much larger one.
Today I will share with you three stories: two personal and the other from a client. My hope is that you, kind readers, will learn from these lessons rather experience them personally.
I work hard sharing ideas on building wealth and lowering taxes. These are worthy goals that make the world a better place. What I don’t talk about often is the risks people face once they make it. There is no greater thrill than to watch someone born in poverty finding their way to an abundant life. All too often this is the moment they destroy their lives. Usually it is temporary; sometimes not. These lessons can help you avoid the same fate.
Once you reach 50 retirement planning takes on a new level of seriousness. Avoiding a setback is more important than ever as there is less time to recover.
There are tools available to help you build for retirement and plan for life in retirement. You can reduce taxes and increase income with these tools. Anybody can use these tools at any age; for those 50 and older these tools have added benefits reducing taxes and increasing retirement income.
Before taking the plunge into retirement, early or traditional, you need to consider factors that will reflect the rest of your life. Handled correctly, early retirement can be a fulfilling blessing. Without proper planning you risk a return to employment you wanted to get away from.
Retirement means different things to different people. Some want to sit back and enjoy a life of leisure. Others wish to travel extensively. And there are some who consider retirement the grand opportunity to start the business of their dreams (maybe not technically retirement, yet still fulfilling), write a book or engage in charitable work.
The path you choose is up to you; there is no right or wrong answer as long as it suits your temperament. There are considerations with right and wrong answers. Get these wrong and retirement can be less than the blessing planned.
Money and taxes play a large role in when you retire and what activities you engage once in retirement. Meaningful activities and family are also serious considerations.
To help you prepare for retirement, I will discuss 10 things of vital importance to smooth the transition. I provide a starting point. You need to prepare from the starting point I provide so retirement plans are retirement realities.
The excitement of bitcoin and other cryptocurrencies has risen to the height of the casino run. The house holds the odds, but for the moment, the card gods are looking kindly upon the gambler.
Some say the run has just begun. As I write, bitcoin is north of $50,000 with at least one large investor feeling bitcoin is going to somewhere around $500,000 per bitcoin! Mark Cuban was not interested in plastic wristbands that promised more energy (a scam), but has no problem with owning cryptocurrency. Interesting.
This past week an old story was refreshed for me. A tax office that handles mostly simple tax returns for a very low price and gets paid mostly cash might not be claiming all that income. A previous employee of that firm informed me over $300,000 in cash was kept in a safe in the money cage.
The final response (and I was thinking the same thing) was, “And I’m sure all that cash was reported.
Cheating on your taxes is as American as apple pie, but a whole lot dumber. If this other tax firm really has that much cash on hand and does not report all their income they lose a lot more than most people expect.
People pay me a lot of money for advice. It’s called consulting. Questions on taxes and money are what start the conversation. But once we get under the hood it becomes clear there is another motive. The real questions involve medical issues, raising children, starting a business and retirement.
It would be easy for me to give a short pat answer. It wouldn’t do much good, but I could do it. Instead, I ask a series of questions helping the client to come to her own conclusions. Some crazy tax guy from the backwoods of northeast Wisconsin will never have clever enough words to convey the right message. I have to help the client find there way there on their own. If I say “Yes” to the best business idea ever and the client is not ready or in the right mindset, they will fail.
And it always comes around to the finish line, aka, retirement. When can I retire? Should I retire?
I could give you a simple formula if you want. Better yet, skip the whole post and scroll to the bottom for the quick and easy answer, for all the good it will do you.
However, it might be better if I share a story and ask a few questions first.