‘Not for the faint heart’ – Four steps to financial independence and retiring early | Personal Finance | Finance


He continued: “Since we’re now living longer on average, your retirement goals should account for the realities of an intended 50 years (or more) in drawdown, as well as inflation assumptions throughout this time.”

Be realistic

When it comes to planning financially for the future, now is not the time to be thinking idealistically or irrationally but it can be difficult to gauge how much money one will spend in retirement.

Mr Norton said: “Many FIRE investors have traditionally followed the four percent, or 25 times income, rule to work out how much they’ll need to accumulate for an early retirement.

“While it’s a broadly helpful guiding principle, this rule is actually based on calculations done in the 1990s assuming a 20-30 year retirement.

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