Retirement 101 How to Create a Budget for Early Retirement Read the Article Open Share Drawer Share this:Click to share on Twitter (Opens in new window)Click to share on Facebook (Opens in new window)Click to share on Tumblr (Opens in new window)Click to share on Pinterest (Opens in new window)Click to share on LinkedIn (Opens in new window) Written by Mint Modified Jul 30, 2022 3 min read Advertising Disclosure The views expressed on this blog are those of the bloggers, and not necessarily those of Intuit. Third-party blogger may have received compensation for their time and services. Click here to read full disclosure on third-party bloggers. This blog does not provide legal, financial, accounting or tax advice. The content on this blog is "as is" and carries no warranties. Intuit does not warrant or guarantee the accuracy, reliability, and completeness of the content on this blog. After 20 days, comments are closed on posts. Intuit may, but has no obligation to, monitor comments. Comments that include profanity or abusive language will not be posted. Click here to read full Terms of Service. Save more, spend smarter, and make your money go further Sign up for Free Retirement is usually associated with older years. But the “certain age” link has a lot more to do with the time it takes to achieve goals than it does with the goals themselves. Financial fitness is the cue for early retirement, not how many years you’ve been in the workforce. The early 50s is a reasonable age to aim for if you want to retire sooner than the majority. That’s not always possible, but every year that you can shave off your working life leaves more time for enjoying it without punching a time clock or attending board meetings. Here are 3 budgeting tips to help make your “golden years” happen sooner than you might expect: Build Retirement Savings Retirement savings takes the place of steady income from a job. The younger you’ll retire, the more you need to save. If you’re starting in your 20s to save for retirement, CNN Money recommends consistently saving 10 – 15% of your income. The older you start, the more money you’ll need to set aside every month. Social Security is no guarantee. Although some people with a very modest lifestyle and zero debt can sustain themselves on SS benefits alone, it’s not easy. There is no promise that benefits will even exist when you retire, and retiring early means you’d have to wait for them anyway. Check out a retirement calculator to see how much you will need, based on your age, current income, and how much you’ve already set aside. Once you know what you need to save every month, you can account for it in your monthly budget. Get Out of Debt The less debt you have at retirement, the less money you’ll need to have the lifestyle you want. Getting out of debt doesn’t just mean paying off credit cards, either — your home might be the biggest debt you’ve got. Examine your current budget, and refocus it a bit, if necessary, to paying off debt as quickly as you can. For every payment you don’t make to someone else, you have more money to add to retirement savings. If getting out of debt and saving for retirement at the same time make it seem like early retirement is an unattainable goal, you’ve discovered why so many people don’t do it. Without a generous income, it’s a real challenge. But every step you take toward eliminating debt makes retirement a little bit easier. And with real discipline, you could decrease the number of years that you’ll have to work to earn a living. Max Out Your IRA and 401K Contributions Add money into an IRA and your 401K, and be as generous with yourself as you can. These plans have limits on how much you can contribute, and CNN says your company might impose even lower limits. If you’re already over 50, you can add more than younger workers are allowed. Take advantage of this “catch-up” opportunity, and stock up on your savings. Many factors go into determining when you’re ready to retire. Your Social Security benefits might be substantial, and a company pension might also beef up your monthly income. On the flip side, you can’t count on Social Security, and many people don’t have the benefit of a pension. And neither might be available until you’re well into your early retirement. The bottom line is that you will need a substantial amount of money to retire early, and the only person you can count on to provide it is you. Start making smart choices now, and you could carve out more and more time for retirement in the future. Mint.com can help you create and maintain a budget for early retirement. With money in / money out in such a critical balance, you’ll want to stay on top of your earnings, savings, and even investments as much as possible. Mint makes it easy. Sign up for your free account today! Save more, spend smarter, and make your money go further Sign up for Free Previous Post Chapter 10: Use a Retirement Calculator Next Post Creating a Monthly Budget with Retirement in Mind Written by Mint Mint is passionate about helping you to achieve financial goals through education and with powerful tools, personalized insights, and much more. More from Mint Comments are closed. Browse Related Articles Retirement 101 Chapter 03: How to Create a Retirement Budget Retirement 101 Chapter 11: How to Retire Early Retirement 101 Chapter 01: How Much Do I Need to Retire? Retirement 101 Chapter 10: Use a Retirement Calculator Retirement 101 Chapter 04: Best Ways to Save for Retirement Retirement 101 Chapter 02: How Much of Your Paycheck Should You Save E… Retirement 101 Chapter 07: Investing in a 401(k) vs. 403b Saving 101 Chapter 02: How Much of My Paycheck Should I Save? Retirement 101 Chapter 06: Investing in an IRA vs. 401k Retirement 101 Chapter 08: What Is Social Security?