In recent years the idea of FIRE (Financial Independence and Retire early) has caught on and becomes trendy. The pandemic and the economic chaos resulting from this have also forced some companies to offer early retirement packages to employees, such as the VSS (Voluntary Separation Scheme).
If you are toying with the idea of retiring at 40s or 50s, you need to weigh this important decision carefully. Saying goodbye to work and breaking free from this constraint is exciting. But you will need to ensure that you are financially sound to live this “free” life.
THE PROS
1.Freedom. No more waking up early if you don’t want to. No more reporting to bosses that adds stress to your life. Freedom to travel and explore the world of “no work”
2.Time to pursue your passion. The first thing I did was enrol myself into a serious adult music and piano course. What is your passion?
3.Improvement in wellbeing. You will have time to exercise and sleep early. No more excuses related to work to procrastinate on this.
4.You can still work at your own pace and choice. No more high stress job such as those corporate responsibilities I used to carry.
THE CONS
1.Year of reduced or no income. Early retirement means you are no longer generating income on your own. You have to depend on whatever retirement assets you have acquired over the years to sustain your living standards.
2.Health insurance crunch. You may have relied on the medical benefits and insurance provided by your employer(s) over the years. When retired, you need to ensure that you have this fully covered. Serious illness could drain your financial or retirement assets.
3.To a certain extent, we or our lives are defined by our work. Believe it or not, without work, we would lose our identity, our sense of belonging, our worth.
4.You can be lonely. Your work or office environments create your social settings. Without work, you may become lonely. Your spouse may even find you annoying being around the house too often!
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Article adapted from https://money.usnews.com/
