Quit and Retire Three Years Earlier!

For most people, there is a direct correlation between how worried they are about retirement income, and how much they can actually do about it. This is because the more worried you are, the closer you probably are to retirement, and the less time you have to do anything - like save up. Effective 'saving up' requires time. Time so your money can grow. Save an extra $200 a month, three years before retirement (at age 62), and you'll amass a grand total of $7,887 (averaging 6% growth). Not likely to have a big impact on your retirement lifestyle.

But what if you invested for retirement when you were NOT worried about it? What if you, say, quit smoking a pack a day at age 45 and took the money and invested that instead? (For the purposes of this illustration, let's assume a pack costs $7.00 and you smoke a pack a day so you invest, for easy figure's sake, $200 per month. Again, average compound rate of return is 6%.)

Instead of starting to save when you start worrying about retirement (at age 62), and amassing that grand total of $7,887 by age 65, you start saving when you're NOT worried about retirement (at age 45 - by quitting smoking and saving that money) so you end up with, wait for it, --- $91,129 !

What will $91,129 do for you at age 65? It would provide you with $456 in additional monthly income for the rest of your life (continuing to average 6% growth), and you won't have to touch your capital. Or, perhaps, you could choose to retire earlier!

Don't start to worry, at age 62, and save a paltry $7,887 by 65. Instead, start saving $200 more a month at age 45, when you're not worried, and have $69,892 by age 62! Then you could retire completely at age 62, by using both the principle and interest as income from 62 to 65. $69,892 would provide you with $2,100 in income for three years! Thus, quit smoking and quit working 3 years earlier!

Of course, most of us 'act' when we have the 'urge' to act. (Note how the words 'urge' and 'urgent' have the same root.). You will tend to act on your retirement plan when it is most urgent. But long term goals are, by their very nature, NEVER URGENT! Now, perhaps THAT is something to worry about.

About The Author

Rick Hoogendoorn is a financial security advisor with Cheri Crause & Associates Inc. (He quit smoking ten years ago this month.) Cheri Crause is a certified financial planner in Victoria, BC.

www.chericrause.com

rick.hoogendoorn@shaw.ca

MORE RESOURCES:

Course explores #39;Investing for Income#39; - Independent Press

Start investing in strong manufacturing and services cos - Economic Times

New investment instrument seen to serve well for property sector - Business Mirror

table border=0 width= valign=top cellpadding=2 cellspacing=7trtd width=80 align=center valign=topfont style=font-size:85%;font-family:arial,sans-serifa href=http://news.google.com/news/url?sa=Tct=us/2i-0fd=Rurl=http://www.nytimes.com/2008/10/12/realestate/commercial/12sqft.html%3Fref%3Dbusinesscid=1256252887ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNEHSzClGm_ftSMwIvvTFnOH8NOTrgimg src=http://news.google.com/news?imgefp=MZ64e2UEVlQJimgurl=graphics8.nytimes.com/images/2008/10/12/business/12sqft.xlarge1.jpg width=80 height=27 alt= border=1brfont size=-2New York Times/font/a/font/tdtd valign=top class=jfont style=font-size:85%;font-family:arial,sans-serifbrdiv style=padding-top:0.8em;img alt= height=1 width=1/divdiv class=lha href=http://news.google.com/news/url?sa=Tct=us/2-0fd=Rurl=http://businessmirror.com.ph/index.php%3Foption%3Dcom_content%26view%3Darticle%26id%3D225:new-investment-instrument-seen-to-serve-well-for-property-sector%26catid%3D24:companiescid=1256252887ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNFGtDIqPg6pHy0GoRdl1Y1SB1llhANew binvestment/b instrument seen to serve well for property sector/abrfont size=-1font color=#6f6f6fBusiness Mirror,nbsp;Philippinesnbsp;-/font nobr13 hours ago/nobr/fontbrfont size=-1THE creation of a real-estate binvestment/b trust (REIT) company bodes well even under a crisis environment. At the sidelines of the REIT Forum on Friday, b.../b/fontbrfont size=-1a href=http://news.google.com/news/url?sa=Tct=us/2-1fd=Rurl=http://www.guardian.co.uk/business/feedarticle/7851360cid=1256252887ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNEWMf9Jq8D7HQYi03LyaMBnOpPbZwIPO VIEW- Health care REITs seen as IPO bright spot/a font size=-1 color=#6f6f6fnobrguardian.co.uk/nobr/font/fontbrfont class=p size=-1a class=p href=http://news.google.com/news?sourceid=navclientie=ISO-8859-1rls=GGLG,GGLG:2005-22,GGLG:enncl=1256252887hl=ennobrall 5 news articles/nobr/a/font/div/font/td/tr/table

Buffett-style investing shines - Inquirer.net

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Now is a great time to be a beginning investor - Newsday

table border=0 width= valign=top cellpadding=2 cellspacing=7trtd valign=top class=jfont style=font-size:85%;font-family:arial,sans-serifbrdiv style=padding-top:0.8em;img alt= height=1 width=1/divdiv class=lha href=http://news.google.com/news/url?sa=Tct=us/4-0fd=Rurl=http://www.newsday.com/business/yourmoney/ny-c5878616oct12,0,2042009.storycid=1256597323ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNGLftgm7GC8c7o_4rAs078c31a3iQNow is a great time to be a beginning investor/abrfont size=-1font color=#6f6f6fNewsday,nbsp;NYnbsp;-/font nobr17 hours ago/nobr/fontbrfont size=-1Starting out in binvesting/b right now might seem especially irrational, but many binvestment/b experts consider this an opportune time. b.../b/fontbrfont size=-1a href=http://news.google.com/news/url?sa=Tct=us/4-1fd=Rurl=http://www.pr.com/press-release/110488cid=1256597323ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNH4oOhovJPWYuG31GVhezj2P7iBUwBizyMoms Provides Readers with an Expert in Stock Market bInvesting/b/a font size=-1 color=#6f6f6fnobrPR.com (press release)/nobr/font/fontbrfont class=p size=-1a class=p href=http://news.google.com/news?sourceid=navclientie=ISO-8859-1rls=GGLG,GGLG:2005-22,GGLG:enncl=1256597323hl=ennobrall 14 news articles/nobr/a/font/div/font/td/tr/table

Personal Finance: Investing with the best returns - Business Mirror

Time to turn on other growth with engies as exports look set to be hit - Nation Multimedia

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Investing Like Buffett - New York Times

table border=0 width= valign=top cellpadding=2 cellspacing=7trtd width=80 align=center valign=topfont style=font-size:85%;font-family:arial,sans-serifa href=http://news.google.com/news/url?sa=Tct=us/7i-0fd=Rurl=http://www.dividend.com/blog/%3Fp%3D2257cid=1255356738ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNFNrbe7q6KCXRekspFj3MnnG4VDYQimg src=http://news.google.com/news?imgefp=e7QRfG9z5HYJimgurl=www.dividend.com/blog/wp-content/uploads/storypics/light-bulb.jpg width=80 height=64 alt= border=1brfont size=-2Dividend.com/font/a/font/tdtd valign=top class=jfont style=font-size:85%;font-family:arial,sans-serifbrdiv style=padding-top:0.8em;img alt= height=1 width=1/divdiv class=lha href=http://news.google.com/news/url?sa=Tct=us/7-0fd=Rurl=http://www.nytimes.com/2008/10/11/business/11values.html%3Fref%3Dbusinesscid=1255356738ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNEzatrsTBQ80gSPmcdKyki9YYy9EQbInvesting/b Like Buffett/abrfont size=-1font color=#6f6f6fNew York Times,nbsp;United Statesnbsp;-/font nobrOct 10, 2008/nobr/fontbrfont size=-1It’s easy in theory: Mr. Buffett accumulated his fortune by binvesting/b only in businesses he understands, buying shares when they were cheap and holding them b.../b/fontbrfont size=-1a href=http://news.google.com/news/url?sa=Tct=us/7-1fd=Rurl=http://www.newsday.com/sports/olympics/sns-yourmoney-1012marksjarvis,0,2684003.storycid=1255356738ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNEx-Op1y3sfE1VGVp4oucuLdFTZugWant to be like Buffett? There are ways/a font size=-1 color=#6f6f6fnobrNewsday/nobr/font/fontbrfont size=-1a href=http://news.google.com/news/url?sa=Tct=us/7-2fd=Rurl=http://www.guardian.co.uk/business/2008/oct/12/warren-buffett-goldman-sachscid=1255356738ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNEKXQTpARxwyF4aPZXpFIXOBfwu7wBargain shopper Buffett fills his basket with vintage deals/a font size=-1 color=#6f6f6fnobrguardian.co.uk/nobr/font/fontbrfont size=-1a href=http://news.google.com/news/url?sa=Tct=us/7-3fd=Rurl=http://www.usatoday.com/money/economy/2008-10-01-1678224584_x.htmcid=1255356738ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNEbJeaOhk8cCY-02XG6vd5D7o9fqwBuffett#39;s company to buy $3B of GE preferred stock/a font size=-1 color=#6f6f6fnobrUSA Today/nobr/font/fontbrfont size=-1 class=pa href=http://news.google.com/news/url?sa=Tct=us/7-4fd=Rurl=http://www.rttnews.com/Content/TopStories.aspx%3FNode%3DB1%26Id%3D735234%26Category%3DTop%2520Storiescid=1255356738ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNGUfRyYEfJA9WOQvx4aZCAF_mviownobrRTT News/nobr/anbsp;- a href=http://news.google.com/news/url?sa=Tct=us/7-5fd=Rurl=http://newsticker.welt.de/index.php%3Fchannel%3Dfin%26module%3Dsmarthouse%26id%3D790397cid=1255356738ei=HLXySOSfFaT2ygTlipTBBwusg=AFQjCNEk4AlWj7z4o8CguhWiEEE7MvHHbAnobrWELT ONLINE/nobr/a/fontbr/font class=p size=-1a class=p href=http://news.google.com/news?sourceid=navclientie=ISO-8859-1rls=GGLG,GGLG:2005-22,GGLG:enncl=1255356738hl=ennobrall 63 news articles/nobr/a/font/div/font/td/tr/table

Investing in a new set of wheels - Stockton Record

UPDATE 1-Wealth funds, recipients adopt investing principles - Reuters

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Investing - Google News

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