Quit and Retire Three Years Earlier!

For most people, there is a direct correlation between how worried they are about retirement income, and how much they can actually do about it. This is because the more worried you are, the closer you probably are to retirement, and the less time you have to do anything ? like save up. Effective 'saving up' requires time. Time so your money can grow. Save an extra $200 a month, three years before retirement (at age 62), and you'll amass a grand total of $7,887 (averaging 6% growth). Not likely to have a big impact on your retirement lifestyle.

But what if you invested for retirement when you were NOT worried about it? What if you, say, quit smoking a pack a day at age 45 and took the money and invested that instead? (For the purposes of this illustration, let's assume a pack costs $7.00 and you smoke a pack a day so you invest, for easy figure's sake, $200 per month. Again, average compound rate of return is 6%.)

Instead of starting to save when you start worrying about retirement (at age 62), and amassing that grand total of $7,887 by age 65, you start saving when you're NOT worried about retirement (at age 45 ? by quitting smoking and saving that money) so you end up with, wait for it, --- $91,129 !

What will $91,129 do for you at age 65? It would provide you with $456 in additional monthly income for the rest of your life (continuing to average 6% growth), and you won't have to touch your capital. Or, perhaps, you could choose to retire earlier!

Don't start to worry, at age 62, and save a paltry $7,887 by 65. Instead, start saving $200 more a month at age 45, when you're not worried, and have $69,892 by age 62! Then you could retire completely at age 62, by using both the principle and interest as income from 62 to 65. $69,892 would provide you with $2,100 in income for three years! Thus, quit smoking and quit working 3 years earlier!

Of course, most of us 'act' when we have the 'urge' to act. (Note how the words 'urge' and 'urgent' have the same root.). You will tend to act on your retirement plan when it is most urgent. But long term goals are, by their very nature, NEVER URGENT! Now, perhaps THAT is something to worry about.

About The Author

Rick Hoogendoorn is a financial security advisor with Cheri Crause & Associates Inc. (He quit smoking ten years ago this month.) Cheri Crause is a certified financial planner in Victoria, BC.

www.chericrause.com

rick.hoogendoorn@shaw.ca

---

The Conflict of Interest Game

Disgruntled investors are going after Wall Street once again, this... Read More

Real Estate Clubs Hot Among Investors

Six or seven years ago, the stock market was booming,... Read More

It Must Be Joe Cockers Market

Agonizing displays of poor theatrics failed to entertain my mind... Read More

Investing: The Art Of Making Your Money Work For You

There is a lot to know about investing. It all... Read More

Have You Ever Seen A Map of the World Turned Upside Down?

For those accustomed to viewing things a certain way, it... Read More

Investing: Do You Want To Make Money, Or Would You Rather Fool Around?

It always amazes me how much stock market investors resemble... Read More

Investing & Online Stock & Share Trading: Money & Risk Management - Atkinson Portfolio Planner (1)

This article was originally featured in Daryl Guppy's 'Tutorials in... Read More

Choosing A Financial Advisor

With so many financial advisors trying to woo you with... Read More

Keep Stock Market Investment Profits

Have you had one of those huge investment winners ?... Read More

Seven Investment Terms Everyone Should Know

For those who have never given their financial future a... Read More

Fundamentals of Option Pricing

When one begins to consider an option, it is very... Read More

How to Analyze the Veracity of Investment Newsletters

When trying to analyze whether a promotional ad for an... Read More

Shareholders Meeting Changing With Times

A significant number of corporations that settled accounts in the... Read More

Begging Your Trust in Africa

The syntax is tortured, the grammar mutilated, but the message... Read More

Looking For a Safe Investment? Try a Certificate of Deposit

If you are looking for a safe investment and you... Read More

Variable Annuities

You know all the articles you read about annuities that... Read More

Stock Market Money Management Skills

Let's start by saying: You can't be afraid to take... Read More

Quit and Retire Three Years Earlier!

For most people, there is a direct correlation between how... Read More

A Secret Revealed: Why Most (Day) Traders Fail

The following perspective on (day) trading comes from my many... Read More

Trading Baskets Part I

Q. What is a basket?A basket is a group of... Read More

Options Education: Financing the Calendar!

As a trader, one of the key things that I... Read More

Annuity Investment Guide

While there is not a lack of information on annuities,... Read More

The Power of Small Numbers: Trading Success is Based on Consistency, Not Home Runs

Online trading is so seductive - just sit, click, and... Read More

Coca-Cola - A Value Stock?

There has been much talk lately about Coca-Cola and its... Read More

Powerful Options Basics Lessons Improving your trading in 180 days.

An option is a traded security that is a derivative... Read More

How to Invest Overseas - Intelligently!

In recent months, many advisors have talked a lot about... Read More

5 Things To Know About The Stock Market

50% Of U.S. Households Invest In The Stock Market Individuals... Read More

The Real Cost of a Bad Habit

What is the value of a good habit? Think of... Read More

Critical Options Investing Tip When Trading Naked Calls and Puts

An option is a derivative trading product that is best... Read More

Planning for Retirement

Almost without exception, people don't start planning for their retirement... Read More

Commodities - The Next Big Wave of Fortune Building

Have you often wished you could have got in on... Read More

Bankers in Denial

Denial is a ubiquitous psychological defense mechanism. It involves the... Read More

Investing In Sons Business Could Cause A Real Family Feud

Q: My youngest son wants to borrow $5,000 to start... Read More