Let’s start with a question, What is the optimal age according to you by which you would want to retire?? Most people would want it to be as early as possible but for this one needs to put in a lot of time and planning to implement a perfect plan according to their own needs.
Frequent polls show that most people would want to retire in their 40’s, but its clear from normal observations also that this is not the case for most people as we see people working almost all of their lives to earn a living.
In this article you could find some ideas that you could use to plan out your own retirement. The earlier you start the better it is.
1. How Does a 401(K) work?
A 401(k) is a savings account that has some specific tax advantages. They were originally established through a loophole in the US tax code in the 1980s, but several rounds of legislation have made them accessible to just about anyone.
Every employee in a company can set up one for himself or herself so what exactly are the advantages for having one ability to save on federal income taxes. Every dollar that is put into a 401(k) account is considered non-taxable income by the federal government (up to a limit of $15,500). For people who are looking at particularly high tax burdens, this can save them thousands of dollars off of their tax bill. Furthermore, the money that is in the account is allowed to grow tax-free.
2. Mutual Funds
This is again a obvious and everyone knows that mutual funds can give exponential returns in the long run but most people are not able to have the disciple to keep a steadily SIP for 20-30 years. You could choose a fund depending on your risk appetite.
Now this is a riskier investment and people have lost money but with good knowledge and some discipline this investment can give you the highest return on your investment. Also it’s a proven thing that in the long run people have made money most often than not.
4. Property Investment
This is something that has been around for age and people have earned a lot with minimal risk but one needs a good sum of capital to get into this and like always discipline is a must with adequate knowledge of how and what causes the changes in the price.
This is the most obvious and straightforward way that most people see to earn a lot and retire as early as possible and letting someone else handle your business but it should also be common knowledge that actually having a successful business is one of the hardest things to have and takes a lot of time, money and connections. That said if you think you have what it takes to start and continue your own business by all means try one because it’s a risk worth taking.