Want to Retire in 20 Years? Here’s What You Need to Start Preparing Now

Here’s a question: ‘Does having a job and clinging onto it for the next 20, 30 or 40 years secures you your well-deserved financial future?’

Today, many begin to realize that job security by itself does not guarantee one’s financial security over the long-term. It involves more than just ‘working hard’.

While there are many ways to financial independence, for most, it starts by one having a suitable plan for it. Let us discuss what financial independence is and why it is best for us to start planning for it today.

What does Financial Independence Mean?

Different individuals will have different views and opinions on what being truly financially independent is. They are shaped by many factors such as our financial status, beliefs, education, upbringing, interests, and so on and so forth.

To put it simply, a person is viewed to be financially independent if he is able to support his desired lifestyle without reliance on active sources of income in his lifetime.

For instance, if your desired lifestyle requires S$10,000 in monthly expenditures and they are fully financed by passive income generated from your investments (dividends, interests, rents, ... etc), you are indeed financially independent.

What Would You Do If You Don’t Have To Worry about Money?

Assuming you are 30 years old, what could you be pursuing if you can choose to quit your job 10 or 15 years in advance of your colleagues because you achieved financial independence?

Will you be:

Planning early for financial independence may increase your chances of achieving it and thus, providing you with more choices on what you could do to live a more fulfilled life earlier.

Are you prepared for life’s curveballs?

Being financially independent allows you to quit your day job or active business if you choose to.

But, what if the decision to quit your job or your business is forced upon you? It may happen due to many factors such as poor economic conditions, having bad relationships in work or business, accidents, illnesses, and the list goes on.

Before it happens, we can definitely choose to do something about it today. For instance, we can save money, invest and have ourselves sufficient life & medical insurance coverages to be well-prepared for these challenges if they arise.

Hence, having and executing a sound financial plan early may act as a ‘lifesaver’ to you in the event of an unfortunate loss of active income.

Your first step towards financial independence

There are many ways to achieve financial independence.

Most people who are financially independent have achieved it quicker through having a portfolio of businesses, real estate, stocks, and other classes of assets. With that being said, the above are not suitable to you if you do not have plans to start a business or to learn how to invest in the asset classes stated above.

If that describes you, it may be more practical to start by determining what you intend to achieve financially in the short and long term. Then, you may design a specific financial plan to achieve them. If you are unsure on how you may begin your journey towards financial independence, you may consider seeking advice from a qualified professional or consider PruActive Retirement.

With PruActive Retirement, you can gain financial independence at your desired age and retire in peace. A highly customizable product, PruActive Retirement can help boost your retirement funds and achieve your well-deserved financial independence earlier in the future.

For more details, please visit: bit.ly/PruActive

 

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