So you’d like to retire early. Having that type of mindset is excellent thinking!
Even if the naysayers may be telling you otherwise, you’d love to prove them wrong. You’re a hard-working doctor, and if there’s any chance you can retire early, you’re all for it!
But to make that happen, you need to come up with a plan of attack.
Even though you’re making the big bucks now, you may be buried in debt. And unfortunately, it’s hard to retire early when you have to deal with money that you owe!
Don’t give up hope just yet. There are ways to pay off debt, live within your means, and retire early.
Follow these five tips to find out how you can get closer to reaching your goal of having an early retirement.
1. Crush Your Debt
After going to medical school, unless you worked while you were in school, you likely have a lot of debt. After all, no one ever said, becoming a doctor is cheap!
You have a long way to go before being debt-free. Yet, there’s no time like the present than to start chipping away at it. It may not happen overnight, but to retire early, first, you need to crush your debt.
If you’re still a medical school student, come up with a plan to pay off your debt as quickly as possible. Consider taking a job such as being a tutor or Emergency Medical Technician (EMT), so you can help pay for school.
There are many ways to pay off your debt. Look into forgiveness programs and select an income-driven repayment plan. Making up your mind to follow through and pay off your debt will help you get that much closer to retiring.
2. Don’t Be a Frivolous Spender
As a doctor, it’s easy to get caught up in the “I can spend whatever I want” mentality. And it doesn’t matter if you’re a physician. It’s easy for anyone with a high-paying job to get wrapped up in spending more.
But, just because you make more doesn’t mean you have to spend more. It should be the opposite.
Don’t be a frivolous spender even though you have an excellent income. Choose to be frugal and only live within your means.
The less you spend, the more you can save. If you’re an excellent saver, you’ll be on the fast track to early retirement!
3. Start Thinking About Your Post-Retirement Plans
To retire early, having an incentive will help you get closer to reaching your goal.
Ask yourself what you’d like to do after you retire. You may want to focus on volunteering in a foreign country or pursuing a hobby such as painting.
As much as you love being a physician now, you need something to look forward to in the future.
The more you think about the fun you’ll be having after you retire, the more eager you’ll be to save.
4. Put Every Dollar You Can Into Investing
You may already have an investment plan set up. Even so, there is always more money you can pour into investing.
Think of all the ways to cut back. You can have one less TV subscription (get rid of Hulu!) and drink one less Starbucks drink a week.
Start thinking of ways you can invest more instead of spending more.
As we mentioned, it’s far too easy to get caught up in a spending trap. But spend too much money, and you won’t be doing yourself or your future any favors.
Think about every dollar you’re spending and ask yourself if you need the item you bought.
Suppose the answer is no, invest that money instead! Watching your nest egg grow will be fulfilling and make you excited to retire early.
5. Lower Your Retirement Budget
Having a retirement budget is vital. You need to know the projected amount of money you’ll be spending after you retire.
But if you’d like to retire sooner, analyze your budget. Can you live off of $4,000 a month instead of $5,000? If the answer is yes, do some math and think about what changes would need to take place to make that happen.
Weigh if it’s more important to you to retire early or have more money in retirement.
Having a lower budget doesn’t mean you won’t enjoy retirement as much. It means that you could move to a different area or spend less paying off a new car in the future.
Carve some time out to think about the expenditures you will have in the future. Based on that, customize a retirement plan that works well for you.
In Conclusion
Start saving now so that you’ll get one step closer to retiring.
If you have any debt, pay it off first. Then, create a plan of attack so you can save for early retirement.
Say you love your job and don’t want to stop working yet. Even if you decide to wait to retire, it’ll be nice having the option to do so.
Strive for financial independence as a successful physician. Only then will you reach your early retirement goals.
