the eighth challenge is about retirement.
the core of this lesson is about planning to not having to work forever.
three core principles of retirement.
first principle
decide when you want to retire, don’t let them decide for you
When I started working I didn’t want to think about retirement because it’s something I would take care of later. I figured signing up for the retirement plan my jobs offered was all the thinking I needed to do about it.
Instead of putting the thought of retirement off until later, let’s put it front and center. First, what is retirement at its core? It’s the time that you no longer have to work because you put money somewhere that will pay you enough to live without working. The government and jobs alike say that retirement usually happens at 65 years old. But the truth is you get to decide when retirement is based on what you create that will start paying you enough to no longer need to work. The first principle of retirement is deciding when you want to retire and then to backwards plan.
second principle
decide how you want to retire
Retirement should be a creative process of looking at your future and making decisions that create a sustainable foundation for life. In order to know what you’ll need to not have to work, you have to have a deep understanding of what you work for. Working allows you to pay for the things you need and have in life (commonly known as bills). So one creative way to retire is to slowly rid of your bills. We pay a bill for the place we live and what we drive. Well if both of those things are paid off, then you get rid of two major bills.
Secondly, if you want money to have later down the road, make sure you put some of your money somewhere where it grows safely. If you’re offered a retirement contract, make sure that you understand how much it grows, how much you’ll have every decade in your account based on it’s growth, and if there are any fees or taxes that you’ll have to pay as a part of the retirement contract.
third principle
annuity – a retirement cheatcode
Why are annuities are a retirement cheat code?
- You don’t pay contract fees to the companies offering the contract
- Annuities provide tax-deferred income so you don’t lose money by paying income taxes out right
- Annuities grow faster (double to triple the interest rate) as typical retirement accounts
CHALLENGERS 