Should You Retire Early?
Early retirement is not for every one, and it is not like everyone need to retire early. Don’t blindly follow the bandwagon and join the F.I.R.E (Financial Independence Retire Early) cult. You subconsciously know who you are, and whether early retirement makes sense for you. Here are some reasons why you may not want to retire early.
You don't know what you will do with all the free time
Just imagine, once you have achieved the goal of early retirement, and if you sit down to think “what’s next?”, then boy are you in trouble. You should already have a plan for what you want to do after you retire. You may not have a lot of free time as you might imagine but you will still have some time to kill. And if you are the kind of person who gets bored quickly, and getting bored is not something you like, then you may not like early retirement. Even worse, if you are an extrovert and like spending time with friends and party around, then you may find it difficult to find friends since they will be busy with work and daily lives, unless of course you have a bunch of friends who retired early too. So for people like you, early retirement is probably not a good idea.
You don't like criticism or probing
The difficult part about early retirement is not the money (you actually will need much less than what you are imagining), but being able to face the criticism of people who don’t understand the concept of early retirement. People will constantly be wondering if you are lying and secretly doing something and hiding that under the name of retirement. So they will probe you to no end.
Someone: May be you want to do a start-up? Me: No. Them: May be you are going to do some research then. Me: No. The friendly neighbour: May be you are going to do real estate or stock market business. Me: No. Self proclaimed well-wisher: You are fool to be lazy and not doing anything productive with your life. Me: Yes, thank you for understanding.
If you cannot handle the constant criticism and probing you may want to reconsider early retirement. People will be really curious as to what you are doing and they will be happy to give you a piece of their mind on how you are throwing away your life.
You have the "keeping up with Joneses" syndrome
If you cannot bear the thought of not being able to live richly then you probably should not retire early. Note how I said “not being able to live richly” instead of saying “living poorly”. After you retire early, you are not going to live like a monk (although there is nothing wrong with living like that) or a pauper, but you definitely cannot buy all the expensive things, go on international vacations twice a year and have 2 maids, 1 cook and a driver in the house. You will have to live below your means and scale your expectations, unless of course you have saved up a huge amount of money (in which case why couldn’t you have retired earlier instead?). You will still be able to pick the bill when you go out with friends, but you will not be able to buy that BMW or show off the expensive school your kid goes to.
You don't earn enough
While you could be living a minimalist life, you still need to be earning enough to be able to save up for your early retirement. For a vast majority of people this is not the case. You may not be earning enough to save much for your retirement after spending on all your expenses. Check if your savings and expenses will let you retire early using the “How soon can I retire” calculator.
You are a habitual procrastinator
May be you like to think, analyze, and plan everything perfectly, so much so that you keep thinking of all the ways things can go wrong instead of thinking about your goal of retiring early. Many people overestimate the amount of money they will require to retire early. It is not going to be that really big number that you are imagining in your mind. You don’t need that much. Even in my case, I have changed my retirement date several times (moving it closer and closer) until I retired at 37. I originally planned to retire at 45.
The funny thing about money is you always feel like you need more — even when you have enough, you never have enough
You are scared of risk
If you are too conservative and don’t want to take any risks, you may not be able to retire early. Many people just assume that they will not be able to generate income after they retire. That is not true. While I am not earning any income, if it were to happen that my retirement corpus is unable to sustain my living habits, I am sure I will be able to figure something out to earn money. You have to take some risks.
Don’t make money your only goal to retire early. It is one big part, but there is a lot more to it. You change your lifestyle, you pick up new skills and do fun projects. You get to spend more time with family. You are confident, strong and can weather anything that life throws at you. If that is you then you are ready for an early retirement. Go ahead, take the dive
Take up one idea. Make that one idea your life – think of it, dream of it, live on that idea. Let the brain, muscles, nerves, every part of your body, be full of that idea, and just leave every other idea alone. This is the way to success.
-- Swami Vivekananda