Wouldn't it be nice to kick back by the beach on an exotic island sipping pina
coladas as you watch the sunset wouldn't it be nicer if you were doing
this in your 50s or perhaps even sooner there's a certain level of peace
that comes with knowing that all your bills can be covered by the retirement
nest estate you've built up over time when you've
established this type of lifestyle for yourself
why wouldn't you take a boat cruise to the galapagos islands especially
when you can really afford it well boss in this video i will share with you how
to save 50 of your income and retire early and if
you're new to the channel then hit the subscribe button below for more
life-changing content simply put nothing beats early retirement
this special time gives you the chance to really enjoy the remaining days of
your life but how does one retire early when there
are tons of things to do and an equal amount of bills to pay
while still struggling to make ends meet one of the surest ways to retire early
is to build up your wealth in your youth unless you win the lottery then you've
got to plan and work your way up building up wealth doesn't happen by
accident there are proven strategies with which you can do so
one vital part of that strategy is saving money money spent on non-tangible
things like electronics or a night out at the club will be gone forever
but money saved will be right there waiting for you to invest
either way it remains at your disposal now it does take quite a bit of
discipline to save money considering all the pleasurable things
out there for you to spend it on but how about saving
fifty percent of it that's harder right well if it wasn't hard the rewards
wouldn't be so pleasant luckily boss i am now going to share
with you my favorite ways to save more money so that you can have cash you need
to invest and ultimately rely upon to retire early number one
assess your current savings percentage this is by far the most common
and most effective way to save money and build wealth note that the amount you
save has to be substantial enough most people go for 10 percent while
others push for 20 and the more courageous ones save half
yes 50 don't be a lazy saver and just put aside
5 not that there's a problem with saving 5
except that if you do it means you'll build up wealth slower
by the way the extra five percent you didn't save would still be spent on
something intangible so you might as well have rounded it up
to ten percent knowing how much you put aside for savings on a monthly basis
can give you a clear estimate of how much you would have saved at the end
of the year number two keep the change for yourself
call it what you want to call it but what you call change could pile up to a
decent sum of money not to buy a mansion of
course but for small scale expenses like buying groceries or fixing a broken tv
when you get home from work or shopping dip your hand into your pockets and put
all the change you can find get a piggy bank and stash it in there
and yes piggy bank is a technical term for this device it
doesn't matter where you hide your change
what matters is this keeping up this habit will pile up the money in the
months and years to come remember little drops of water make up
the ocean number three participate in a savings
challenge this involves joining a group of people
where you all motivate each other to save
there are different types of saving challenges and some examples include
saving any old bills saving ten dollars per week
saving ten dollars in week one twenty 20 and week 2 and so forth
those who do well or win the challenge get some kind of reward
this is great for those who are not capable of motivating themselves
and need a little bit of a push personally this is my least favorite
means of saving money reason is i think everyone should
motivate themselves to save after all the rewards will be all yours in the
future right but if you need a push then maybe
this is it number four use the stranger test
if you're someone who struggles to save duty or love for shopping then learning
and employing the stranger test is for you
let's say you walk into a store and see a shirt that you think would look great
on you before pulling out your wallet and
completing the transaction you should be running yourself through this stranger
test if you've never heard of the stranger
test before let me explain imagine a stranger standing in front of
you in one hand they have the t-shirt and in the other hand they have fifty
dollars which would you rather have in most cases the cash is probably more
appealing when taking this approach on a regular basis
you'll start to see yourself continuously picking the money over the
item which solidifies your position in not splurging and instead keeping
that money in hand now even with all these savings tips in
action there is still a good chance that you won't be capable of saving 50
of your income this is because your routine expenses are still more than
half of what you earn which means that in order to save a
larger percentage of your income you must make more money here's a
practical example of this concept in action
let's say your salary is five thousand dollars per month and you are currently
saving thirty percent or fifteen hundred dollars
obviously this isn't quite the fifty percent you are aiming to save
as a percentage of your income so you decide to pick up a side hustle to
increase your earnings you now take up a side hustle that pays
you two thousand dollars per month this income comes with no expenses
meaning that every dollar you earn from your side hustle is more disposable
income you have to save now you are earning a total of seven
thousand dollars a month and are saving 3 500 with just half of
your income simply put while saving money is good
earning more is the key to rapid wealth accumulation
so now that you know that you must earn more money to increase your savings
percentage how do you go about doing just that well
here are three easy and effective ways to relied upon in the past
to increase my own monthly income number one
get a raise or a higher paying job asking your employers for a raise is a
great way to earn more money and eventually save
more the problem with asking for a raise is that timeliness
will play into whether you are successful in this endeavor
you likely can ask for a raise when you're a month into the job
but if you spent at least a year serving your employers and you've proven to be a
valuable member of the team then they will surely consider your
request and chances are they will grant it
if they don't then you have the option of finding a job that pays better
number two start a business or freelance starting your own business could also
help you generate some extra income the business may not be a success
overnight but as long as you've got some inflow then you will have more to save
combining your current job with running a new business could be tough
but you can plan your way through it set up a work schedule and determine how
many hours you need to be at work and how many hours you need to spend
with your new business if the nature of your new business
doesn't require you to be there all the time then that's a plus for you
however i urge you to not quit your day job when you're just getting started
with a new business or freelance career remember you're trying to earn more not
less so give your business time to blossom
before you make any hasty job decisions number three get a second job the third
way you can earn more is by getting a second job
earning a second salary will mean more income and more money you'll have to
save as with achieving anything good this
will also require a sacrifice and that sacrifice is the time you spend
on your private life the more you work the less time you'll
have for your book club or family visits or hangouts with friends
but that's a sacrifice you should be willing to make if you want to save more
and retire early now you may be wondering why i am harping on having
such a high savings rate and it's because of the correlation
between saving and early retirement you see financial models exist that can
project your expected retirement date based on how much you have these models
operate on the assumption that you are starting with zero dollars saved
that you can earn between five to nine percent annually and will be withdrawing
four percent of your savings nest egg every year while in retirement someone
who wants to retire in 20 years will need to save about 35 percent of
their income every year however someone who saves 50 percent of
their annual salary can retire in just 15 years and for every additional 15
percentage points that are saved you will reduce your years until
retirement by roughly 5 years keep in mind that this model doesn't
take into consideration any increases in income you may have
while working towards early retirement meaning that if you can earn more and of
course save that money you can further shorten your time until
retirement if you're 25 years old right now
saving 50 of your income every month sets you up to retire at 40
as long as you don't increase your current standard of living and if you
ask me retiring at 40 sounds pretty sweet now
as i just mentioned early retirement wouldn't be possible
without receiving a return on your saved funds for you to retire you must have
reached a point where you have stopped working for money
and money is now working for you so what investments can help you
achieve your goal of an early retirement let's take a look at some of them now
number one pensions some employers offer pensions
that start paying out as soon as you leave the job
or when you get to 59 and a half years old an extra bonus is the continuation
of insurance coverage to retirees who are eligible
this is ideal for those who work for employers that offer defined
benefit pension plans such employers include the police
military and fire service this kind of pension can fund your retirement plan
partly or in whole number 2 u.s treasury bonds this is a great
investment for early retirees the bonds are among the safest you can
find and they offer tax advantages on the state level
u.s treasury bonds usually offer low yields but when mixed with higher risk
securities in your portfolio you can achieve that five to nine
percent you need with these bonds offering a guaranteed return
number three real estate this is one of the most popular means by which
early retirement can be reached u.s tax codes allow real estate investors and
homeowners to write off a large portion of rental
income it also permits most homeowners to be exempt from
capital gains tax if they sell their primary residence besides that
real estate investment can ensure a modest income via rent
that's a good way to earn extra income that will increase
your monthly savings percentage and there you have it
exactly how you can save 50 of your income
and retire early thanks for watching if you want to go from the life you have
to the life you deserve then hit the subscribe button now