What Are the Benefits of Early Retirement?

benefits of early retirement

source: avivaindia

Although the average age to retire in India is around 58-60 years, people nowadays are making early retirement plans to explore new opportunities and chances that life has to offer. Early retirement is when a person stops associating themself with the daily mundane activities of work before the usual enacted retirement age.

Let us discuss the benefits of early retirement and things to keep in mind before planning for one!

7 Key Benefits of Early Retirement

The seven early retirement advantages or benefits are as follows:

1. Pursue Your Hobby and Create a Revenue Stream Through It

Retirement provides you with the opportunity to take a complete break from work and gives you ample time and scope to focus on your hobby. You can use your talent and experience and turn it into a new revenue stream. Additionally, if you indulge in something constructive after retirement, your well-being and self-esteem will get a further boost if you indulge in something productive after retirement.

2. Spend More Time With Family and Friends

An early retirement helps you re-establish old contacts and spend quality time with your loved ones. You can meet exciting people, bond over similar interests and inspire projects where you can collaborate. Additionally, you can take on new responsibilities and help your family with daily chores.

3. Freedom to Travel Whenever and Wherever You Want

After retiring early, you can travel whenever you want to, as there will be no job or deadlines to hold your holiday plans. Furthermore, you will be more physically fit this time and can experience activities like scuba diving, hiking, surfing and many more.

4. Time to Relax and Take Care of Your Health.

The pressure to meet targets in certain job sectors can cause stress, resulting in problems like blood pressure and insomnia. If you choose early retirement, there will be no further work stress. Additionally, you will get time to relax and work on a healthy mental and physical life.

5. Achieve Quick Financial Independence.

You can enjoy financial independence early if you retire before the statutory retirement age. There will also be no pressure to collect more funds to build a corpus as you have already passed that phase.

6. Financial Security for Dependants

When planning an early retirement, it is wise to start investing early. It will help you collect an adequate amount of retirement funds quickly. This way, you can provide financial security to your dependents.

7. Peace of Mind and Stress-Free Life

If you go for early retirement, there is no pressure to wake up early, go to work and live a mundane daily life. You can get a lot of time for yourself and enjoy peace of mind and stress-free life if you opt for early retirement.

What Are the Things to Keep in Mind While Planning for Early Retirement?

Here are some important things to remember if you plan for early retirement:

  • Estimate your expenses
  • Start planning as soon as possible
  • Know your basic requirements
  • Make the right savings and investment plan
  • Actively manage your investment portfolio
  • Set a target for your retirement age
  • Get health insurance
  • Try to pay off any existing debts
  • Settle for a budget-friendly lifestyle
  • Adjust your current budget

If you want to enjoy the benefits of early retirement, focusing on your present-day financial planning is very important. These small sacrifices to your current lifestyle will help you enjoy a stress-free life post-retirement. Thus, plan your finances accordingly, mark your expenses to build the best early retirement plan, and follow your passion for the remaining life.

FAQs about Early Retirement

Is early retirement for employees a good idea?

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 Early retirement is a good idea if you pursue creative or personal interests. However, it is essential to remember that early retirement is only suitable for a few. Therefore, an individual should consider all their needs before making any such decision.

What are the cons or disadvantages of early retirement?

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The cons or disadvantages of early retirement are as follows:

  • There is a loss of regular income.
  • You have to save more to meet daily expenses.
  • Restriction on lifestyle to a certain extent.
  • High expenses on health issues and medical illnesses.
  • No more availability of employee benefits.

Disclaimer

  • This is an informative article provided on 'as is' basis for awareness purpose only and not intended as a professional advice. The content of the article is derived from various open sources across the Internet. Digit Life Insurance is not promoting or recommending any aspect in the article or its correctness. Please verify the information and your requirement before taking any decisions.
  • All the figures reflected in the article are for illustrative purposes. The premium for Coverage that one buys depends on various factors including customer requirements, eligibility, age, demography, insurance provider, product, coverage amount, term and other factors
  • Tax Benefits, if applicable depend on the Tax Regime opted by the individual and the applicable tax provision. Please consult your Tax consultant before making any decision.