Investing

The stock market and retirement

investing in bitcoin as a beginnerDon’t we all want to retire early? The idea of only being 40 years old and having all of the pressures of money and finances taken off your shoulders? Imagine how many years that could add to your life.

Many people have managed to make this vision a reality with the stock market. Now I am not going to sell you on a get rich quick scheme where you make a million bucks in a single day, week, month, or even year.

People that are trying to sell you something like that clearly have an agenda. If they could do that they probably would have already and wouldn’t be spending their days bugging people to buy their products.

So let’s talk about real retirement. The kind people do every day when they turn 65. And how to dramatically move up your timeline for that.

To do that let’s examine the stock market. The stock market has averaged a 7-10% return for the past century. That means every year, if you just invested in your money in the general stock market, you would increase your money about 8.5% a year.

So that means if you have a million bucks sitting in a retirement account, then it is making about $85k a year. So that means at the end of year one of retirement you can pull $85k from your account, and probably still be sitting on the same million dollars.

Are you seeing how this works? You can live on a million dollars for a lot longer than just 10 years if you just live off the interest. As long as the million dollars stays there and continues to make money than you can effectively live as long as you would like.

It’s a beautiful thing. Your retirement gifts could be things like plane tickets instead of wheelchairs!

Now the key here is obviously to get that first million bucks by the time you turn 40. And sure, that is easier said than done. A million bucks is hard to come by. Many people never see that much money in their entire life.

The key here is simple. It is steady investments from the moment  you start to make money.

My recommendation is 10% of everything you make. When you are 18 years old that is probably only going to be $100 to $200 a month. But maybe when you turn 25 then that increases to $300 to $400 a month. By the time you are 30 you are paying $500 a month. At this rate you are sitting on $250,000 by the time you are 40 years old. Sure, you are not ready to retire yet, but at 50 you are there.

The key here is consistency! If this interests you than perhaps it is time to learn more about the stock market.

 

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