Early retirement is the dream, right?
It’d go something like this: “You, co-workers, thought you had to deal with me for another seven years. Psyyyyych!” Then you’d speed out of the parking lot in your RV with Fluffy riding shotgun, off to a new adventure.
OK, so you might handle the situation a bit more gracefully than that, but you get the point: Retiring early could be pretty awesome.
However, shaving off even one or two years from your retirement age might seem impossible at times. But don’t fret: We’ve got a few simple steps you can take at the end of each month to reach your early retirement goal sooner.
1. Assess Your Existing Debts
You’ll need to jumpstart your finances by taking care of the debt you’re already sitting on.
Unfortunately, many of us are getting hit with insane interest rates, which make the repayment process feel fruitless. (For example, this year’s average credit card interest rates hit an all-time high of nearly 16%, according to a recent survey.)
If you want to figure out a better solution, consider consolidating or refinancing your debt to slash those rates.
A solid resource is consumer financial technology platform Even Financial. It’ll allow you to shop around for different rates and even help match you to the personal loan that best benefits you. Rates start at 4.99%, and repayment plans range from 24 to 84 months.
Getting on the road to paying off those debts at a faster rate could bring retirement a little closer to reality.
2. Don’t Put Off Your Student Loan Debt, Either
Just as you can refinance your personal debt, you can refinance your stagnant student loan debt, too.
For this, consider Credible’s student loan refinancing program. Here you can compare various options from its lending partners, so you’ll be confident you’re getting the best rates.
Here’s an example: We wrote about John DePrato, who was floundering in $65,000 of student debt. Each month, he funneled $850 toward the payments. He decided to do something about it, and refinanced through Credible. Now, he pays $400 a month.
Not bad, huh? The process isn’t super difficult either.
3. Check in on Your 401(k)
Got a 401(k)? You’re on the right track.
Now, you just need to make sure it’s doing what you need it to. However, tapping into that account and translating the information — or lack thereof — oftentimes proves difficult.
There’s a robo-advisor for that. It’s called Blooom, and it’s an SEC-registered investment advisory firm that’ll optimize and monitor your 401(k) for you.
A few of us Penny Hoarders use the service. It gives you an initial 401(k) checkup for free, and you’ll get to know your account a little more intimately. Find out if you’re paying too many hidden fees, have the appropriate amount invested in stocks versus bonds, that kind of fun stuff.
Set your retirement age a little earlier, to your end goal, and Blooom can help you get there by investing more aggressively. (That’s what I did.)
4. Stash Away Some Savings Automatically
Unfortunately, you won’t retire early by spending your whole paycheck the second you get it, unless you’ve got something magical up your sleeve.
The best way to start saving is to allot money into a separate account each time you get your paycheck. You can automate this, too, so you don’t even have to see what you’re missing.
If you’re not ready to dive into the world of IRAs or high-yield savings accounts just yet, start smaller.
You can use a micro-investing app like Stash to pull as little as $5 out of your account at the end of each month. Any little bit is better than none. Stash invests the money for you.
It’s a low-risk way to start building a little nest egg, and once you feel comfortable with that, you can start looking at other options.
(Hey, Stash also gives you $5 after your first deposit, so that’s cool, too!)
5. Take a Good Look at Your Monthly Bills
You might think those monthly utility bills aren’t going anywhere; you’re just stuck with them.
Wrong.
You’d be surprised by the ways you can cut back without doing much of anything.
Start with Trim, your own little virtual personal assistant. Trim will negotiate your cable and internet bills for you — so you don’t have to sit on hold for hours.
It’ll also call out any subscriptions you might not know you have and cancel them for you, if you no longer need the product or service. (i.e. Yikes, I’ve been paying for a magazine subscription that gets delivered to my old apartment.)
It’ll also help you save in other areas, like on groceries and restaurant tabs. Really, it’s a handy — and free — tool you should always keep in your pocket. (Keep your phone in your pocket. Trim lives in that.)
6. Keep Tabs on Your Credit Reports
Your credit reports are basically the Holy Grail of your finances — and your life.
Financially, they can influence many of your big life decisions, like buying a house or a car. These decisions can become a whole lot more difficult if your credit reports have an error — or, worse, have been hacked.
This is easy to prevent, though, especially if you just check in on your credit reports (you’ve got three major ones) every so often.
One option is to use a free app like Credit Sesame. There, you’ll get a free credit report card, which you can review for signs of error, theft or fraud. It’ll even give you personalized suggestions to help you improve your credit score.
7. Review Your Budget
Once you’ve taken care of these monthly tasks, sit down and start outlining a budget for (early) retirement.
Nope, this won’t be perfect, and it’ll likely always be changing, but you can start simply with a retirement calculator.
Set your goal retirement age, and figure out how you’re going to get there. If you want to retire early, take that into account.
Now, keep tabs on this budget each month. It won’t be an easy process, but it’s a necessary one — and one you can fine tune as you go.
(Of course, you’ll want to budget for that RV — and Fluffy’s expenses, too.)
Carson Kohler (@CarsonKohler) is a junior writer at The Penny Hoarder. She’s got big plans for retirement… which is 40 years away. Let’s just say she likes to plan ahead.
This was originally published on The Penny Hoarder, one of the largest personal finance websites. We help millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. In 2016, Inc. 500 ranked The Penny Hoarder as the No. 1 fastest-growing private media company in the U.S.
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