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How to Retire Early

If you want to enjoy your life, you may want to know how to retire early. Such a proposition will require a lot of work from your side, but it is doable. And not being dependent on the government will give you a sense of freedom.


What to do to retire before 70

Do not panic because I wrote ‘70’ above. It was supposed to be a joke to illustrate what may happen to you if you simply let the government tell you when you are allowed to retire.

So, you may be asking yourself, how do I retire early? It is a very common question. And it is not difficult to answer it. There is no reason to worry about retirement. I will give you the tools necessary for you to plan how to make it happen.

Very few people in the Western world are optimistic about the economy. There are many reasons for that, but the most important ones have to do with an ageing population, a very large public sector, high debt levels and, perhaps most important of all, a true crisis of values and lack of hope.

All these reasons can be summarized into two: the economy and demographics.

The economy is something that indeed improve if the right decisions are taken. They are not what most politicians are advocating for today, quite the opposite. But we should never lose hope that economic freedom may increase again in the future.

When it comes to demographics, the solution is a lot more difficult. Many Western countries are ageing fast. And this will represent a great burden on the economy. Of course, not all countries are in such bad shape. The United States, France and United Kingdom are in much better position demographically than Germany, Italy and Spain.

Regardless of the state of the economy and the demographic profile of your country, you need to act for yourself. I will tell you why relying on public pensions is a bad idea and what to do about it.

Public pensions have been cut already

Even though politicians love to claim that public pensions are sacred and will be honored, this could not be further from the truth. Public pension cuts have been taken place for a long time. Understanding this is necessary to realize that the first step to early retirement is to stop trusting your government.

The value of a pension is determined mostly by the following variables:

  • How much we collect each month
  • Retirement age
  • Life expectancy

Several Western countries have been updating the way they calculate your pension benefits, i.e. how much you are entitled to receive every month. These adjustments have always led to future retirees getting lower pensions.

On top of that, retirement age has been raised in most developed (and many emerging) countries. This has probably been the greatest cut. Let us illustrate that with basic math.

If life expectancy is 82 years with retirement age at 65, we expect to receive our pensions for 17 years. If retirement age is delayed until age 67, now we only expect to receive those pension payments for 15 years. This represents a 12% reduction.

If we take both types of cuts into account, we will realize that most countries that claim not to have done any cuts to their pension systems have already cut future pension benefits by 20-25%.


Getting angry about these cuts makes little sense. First of all, getting angry is not helpful. Secondly, most public pension systems really are unsustainable and have been in deficit for several years. Cuts are necessary. What is unfair about it is that cuts fall almost exclusively on future retirees.

If we wanted fairness in a public pension system, we would admit what the problems are, why the current system is not sustainable in the long term, and then make adjustments that would treat everyone equally, regardless of when they were born or expect to retire.

Given this is not going to happen, it is time to take action.

Do not complain

While it is understandable to see some people complain about it, it is much better to do something about.  Accept that you will not change those things outside of your control. You do not control the political process, the economy, and much less the demographics of your country.

If you want to know how to retire early, it is time to face the problem and tackle it. Once you know where you are and where you want to get, you only need the proper roadmap.

The Solution

You may still be wondering what the solution to this problem is. And it is very simple: you need to have options. In order to have options, you need to have resources. And to have resources you must start saving and investing as soon as possible. In order to accomplish this, you may need to work hard to increase your income.

There are no tricks or shortcuts. If you want to live on your own terms and retire when you decide, you need to be sovereign and have wealth. You need to take full responsibility for achieving that goal.

Remember that if you do not take care of your problems, no one else will do it for you. No politician or government worry about you. They are too busy worrying about themselves. Consequently, start doing what is necessary to meet your goals.


It is possible to retire early. And it should not be difficult to retire before the official retirement age. But that requires action on your side. It might not be the ideal situation but ask yourself what you prefer: do the work required to live life on your own terms or wait until politicians let you retire.

If you are now wondering what you can do to get started with saving and investing, you will find information on this website and many others. Once you start on your financial freedom journey, you will feel much better.

You will realize that your destiny is in your own hands. You will appreciate the value of your time. It is up to you, and only you.

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Published in Personal Finances

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