This could be the hardest post to accept and swallow, but also possibly the most important that you ever read.
You may initially reject my message or get upset, but the truth will remain and this is an attempt to help people get real about their REAL situation.
First, to be clear, I am not a financial advisor.
I was for a couple years when I was young and I was not disciplined enough to put the consistent time and work in to get steady clients that I could pay the bills.
That being said, I understand the concepts and I am only going to relay statistics, logic and math here so that anything I say can be easily proven.
What do you picture when you think of retirement?
Is it a happy time when you are free of work and cares possibly going on fun adventures with your spouse (possibly kids and grandkids) to exotic tropical locations?
Nothing makes me happier than to see an older (or younger) couple who have worked hard and are able to enjoy the fruits of it doing whatever they want.
Gone are the days where employees worked somewhere for 40 years and the company promised to take care of them forever.
In fact, most of those companies that made those promises years ago are becoming financially insolvent due to the obligations they made.
It is up to you to make sure you can quit working some day and have some money to live on.
Social Security does not pay too much and, due to the uncertainty of the government, is a sketchy arrangement.
They can change the rules at any time and you will be stuck with the results if that is your only option.
You are left with figuring out a way to have an income without working or possibly working in a way that takes little time.
The most common way people do this is by saving up for it.
If you save $200 per month for 40 years, and you keep the money in your safe in your house, you will have $96,000 at the end.
This will not last very long.
You get $400 per month to live on for 20 years and you can die at 85 with exactly nothing left.
Obviously, that option is ridiculous and you will likely put the money into an interest bearing account.
If you invest that $200 every month in an account that earns 8%, then you have over $600,000 after 40 years.
This can then be put into an account that earns .05% every year and you can live off the $3000/month it produces indefinitely.
Now, maybe that sounds appealing as by that time you will have hopefully paid off your house.
However, cars need replacing, bills need to be paid, and there will definitely be emergencies, medical bills, etc.
The list is endless, and this all assumes you earn 8% on that money year after year which will probably not happen.
Stocks that produce those rates are not consistent.
There are dips in the market.
Your investment company charges fees.
Inflation will make your money worth less at that time.
Also, you will probably live longer than the current life expectancy.
There are over a dozen things that can go wrong along the way.
Are you loving the doom and gloom?
It’s going to be ok.
Most likely, you will survive.
I just want to make sure you aren’t deluding yourself.
There are a lot of components that are up in the air and timing plays a part here.
I would say that you need to probably look at putting more money away.
Make sure that your money is in the safest place possible that will still earn a yield of some kind acceptable to you.
I would also look real hard at creating some other kind of passive income.
Now, if you are in real estate, you might be smirking right now because it can be a great income source.
If you own property, you can sell or rent it.
If you don’t want to deal with renters, then outsource the management to someone who can do it for you.
This is another option that I believe you should do on top of saving for retirement (not in place of).
Another option is starting a company that you can sell or automate.
My vote is affiliate marketing, but obviously there are other ways to earn passive income.
Now to be clear, most passive income is only passive after some work has been put in to get it there.
However, generating income streams that pay you each and every month is totally possible.
Read “The 4-hour work-week” by Tim Ferris.
Click Here for “The 4-Hour Work-Week”
In the book, Tim talks about how he completely automated his supplement company so that he was only checking in about once a week.
This allowed him to travel the world and have amazing experiences while simultaneously earning an income and empowering his people to make his company better and better without him there micro-managing the whole thing.
The more options you have, the easier it will be for you when it is time to leave the workforce for whatever reason.
Also, why not start retirement early?
Nothing is truly certain.
However, you can shore up the odds so that it is more likely you are on the winning side.
If you do nothing else, sit down and look at the real math and put together a plan.
Make sure the plan is real with some room for error and not a string of miracles that would need to take place.
If you would like to learn how to make consistent and passive money online, see my #1 recommendation.
It is the same program I used to create an income online that allowed me to quit my full-time job and work part-time from home on my laptop.
Thank you for reading.
Phillip Adams