Set financial goals with your life partner
Successful couples discuss and set joint financial goals. After all, you’re a team, right? But even if you’re both rowing in the same direction, doesn’t mean it’s not challenging to row at the same speed. That’s why it’s important to talk and set things straight.
For example, Brandon, a blogger known as the Mad Fientist, quit his software developer job when he was 34. His partner, Jill, supported his decisions but was not ready to do the same. She liked her optometrist and wanted to keep doing it for several years before joining her partner. Therefore, the couple decided to create a mutual account for household expenses and keep the rest of their money separate, so that both of them could accomplish their goals.
On the other hand, make sure you stay away from these 10 Money Mistakes That Might Ruin Your Relationship for Ever.
Involve the whole family
it’s not only your life partner that should be involved in your dreams of retiring early, it’s your entire family. That’s because early retirement might require extreme saving and eliminating expenses, such as Christmas or other holiday gifts for family members. You might have to put aside 25 to 75 percent of your income, which means you will no longer afford things that were once a given.
However, don’t think of it as a bad thing. As long as you inform your family of your saving plans and that you won’t be able to give them big gifts, everything should be ok. For Jason and Julie Buckley, early retirement bloggers, things went pretty smooth and their families were completely on board.
See also 7 Most Important Non-Financial Assets for a Fulfilled Retirement.
Consider the “cost per hour”
What does that mean? Well, according to Blogger JP Livingston, the secret to cut back on your spending and save more for early retirement is to break down the cost of a purchase into the number of hours it takes for you to make the money for it.
For instance, if you earn $20 an hour, one $100 purchase equals five hours of work. Once you see how much that purchase really means in terms of your time and money, it will be easier for you to decide whether it’s worth it or not. This approach, taken from Vicki Robin and Joe Dominguez’s book, “Your Money or Your Life,” allowed Livingston to quit her New York job in finances at the early age of 28.
