Retiring Early Requires Multiple Streams of Income

Retiring early is something that many people would like to be able to do, but most people are not prepared for.

Short of an inheritance or hitting the lottery, many people find they’re unprepared for a regular retirement, let alone an early retirement.

How do you plan for early retirement?

By knowing how much money you will need, and then figuring out how to amass that much money.

It all starts with knowing how much money it’s going to take for you to be able to retire to the lifestyle that you desire.

That is the key.

Retiring early will lose a lot of its luster if you have to become so frugal that you can't afford to leave the house.

You need to determine how much money it’s going to take for you to live the rest of your life in comfort. Think about where you want to live, and how much it will cost you to live there.

You should also think about the types of activities you want to take part in after you have retired. If you’re a golfer, you’ll need to look at green fees, cart rentals, etc. Or you may need money for restaurants, or theaters, or whatever else interests you.

One important thing to keep in mind is cost of living increases. If cost of living goes up an average of 3% a year, in 20 years your money will have lost almost half of its buying power. You’ll need to take that into consideration when you are planning your savings.

Once you have the total amount you’ll need figured out, it’s time to put together a plan for accumulating that money.

There are many choices that can be made for accumulating the amount of money needed, but they really only boil down to two choices. You can either build up your fund to the level you need or have some income coming in as well.

The danger of the first method is, if your investments go bad after retiring early, there isn't any income to rebuild your nest egg. You’ll either have to adjust your lifestyle, or return to the workforce.

On the other hand, if you can develop streams of income that you can use for your bills rather than taking from your retirement account, the money you have will last considerably longer.

There are many different ways to build streams of income depending on what you are interested in doing. If you’re creative and are willing to do what it takes, you may find that there is a chance to not only supplement your retirement fund, but to have enough to live on.

You should begin to educate yourself in various income stream areas. Some good areas to look at:

• The Internet: Look into building niche websites where you discuss one of your passions and then offer products in that niche that can earn you income


• Real Estate: A few good investments here can set you up for many years of residual income later on


• Network Marketing/MLM: An opportunity in this field can be both fun and profitable as you meet new people


• Option Trading: A bit more difficult but there are some excellent courses that teach this area of the stock market

You can retire early if you take the time to plan out what your retirement is going to look like, and then work to make sure the money you need is available to you.