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I’m 36 with $435,000 and want to retire early — ‘the earlier the better’ —

I’m a 36-year-old with a job paying around $115,000 a year. I’ve done pretty well with my 401(k) and have $435,000 in it. I manage and rebalance it myself and even managed to gain around 6% in 2022 despite the bear market. 

My goal is to retire early. The earlier the better but I don’t exactly want to have a frugal lifestyle. I want to travel the world and I want to do it while I still have time on the clock and can enjoy it. I’m shooting for 50 years old, which will obviously be difficult, but I can settle for 55. 

I’m currently putting 12% towards my 401(k) while the market is down but will likely put it back to 10% after. My employer matches 50 cents to the dollar (up to 10%), plus an extra 3% if I put at least 8% towards it. It amounts to an 80% match if I’m putting 10%, if my math is correct. My portfolio is more aggressive but I plan to slowly rebalance it to safer assets.

Do you think my goal is unreasonable or attainable with the info provided?

See: I’ll be 60, have $95,000 in cash and no debts — I think I can retire, but financial seminars ‘say otherwise’

Dear reader, 

Retiring at an early age is a lofty goal, and it takes a lot of preparation, so it’s great that you’re getting a start on those plans now.

To retire early requires a lot of money, and a few back-up plans. To be fair, any age for retirement requires some back-up plans, as the unexpected can always happen and take a large chunk of your assets, but when you’re choosing to leave the workforce well before the traditional age, you need even extra layers of protection on your side. 

Let’s start with how much money you actually need. There is no one right answer, but in this situation, more is better. For now, don’t feel as if there’s even a possibility of saving “too” much money for retirement because if you’re choosing to stop working at 50 (or around then) so you can travel the world, you’ll need to save as much as you can.

Check out MarketWatch’s column “Retirement Hacks” for actionable pieces of advice for your own retirement savings journey 

There’s this movement called FIRE, which stands for “financial independence, retire early.” People who pursue FIRE try to retire even earlier than you are, in their 40s or their 30s, but everyone approaches it differently. Some go the “fat FIRE” route, where they save as much as they physically can before retiring, and then there are those who may identify more closely with “lean FIRE,” where they save but live frugally. Early retirees may also strive for a multiple of their current salary, such as 25 times what they’re currently earning. 

You can try working backwards to decide how much money you would need per year, such as $40,000 a year, $75,000 a year or more. Depending on that figure, how much would you feel comfortable saving? The 4% rule has been largely contested in recent years, as some experts say it’s too high of a percentage, but let’s use…

Read More: I’m 36 with $435,000 and want to retire early — ‘the earlier the better’ —

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