5 Things Holding You Back From Retiring Early


In my 30 years on Earth, I have yet to meet a person who works a 9–5 job and doesn’t want to retire early. Quite frankly, people’s desire to retire early doesn’t surprise me and it probably doesn’t surprise you either. It’s a well-known fact that between low wages, bad bosses and finite advancement opportunities, people aren’t exactly thrilled to be going into work every day. As such, they view early retirement as a gateway to a more fulfilling and happier life. Sadly though, for many, this dream will only ever remain a dream because they continue to succumb to the many roadblocks on their path down the early retirement highway. Fortunately, if you know what to look out for, retiring early can be achieved and as such here are 5 things holding most people back from leaving the workforce years sooner than they ever imagined.

Number 1: Lack of a retirement plan

Depending on how old you are, you may or may not remember going on family road trips with your parents and them pulling out a big city map whenever they wanted to venture to a new location. In fact, it’s crazy to think how reliant we were on a simple piece of paper to get us from point A to B and that one missed direction could lead to hours of frustration. However, it speaks to the importance of knowing where you’re going and when it comes to retiring early, without a plan you truly will be like a driver without a map.

As we already noted, most people want to retire early, just like they want to lose weight or want to become rich. They want all of these great things but they have absolutely no plan in place to achieve them. This, if you ask me, is one of the biggest indicators that you will in fact never retire early.

Now, if you’re sinking in your seat because you yourself don’t presently have a retirement plan in place, don’t worry I’ve got your back.

In your retirement plan, you’re going to need three things. You are going to need a target retirement amount, an investment amount and a budget.

Your target retirement amount is going to be the total amount you’ll need to have invested. This is the pool of money that you will withdraw from throughout your golden years so it’s essential that you properly calculate this figure. Generally, the rule is that this number is 25 times your annual living costs. However, given that I don’t want you having to work the cash at Walmart at 95 years old I recommend you use a more conservative 30 times your annual living costs instead.

The second element in your retirement plan is going to be your required monthly contribution. You see, you won’t amass your golden retirement goose egg without putting in the work and as such you will need to determine how much you must contribute to reach your retirement amount. The easiest way to do this is to calculate what contribution amount at the market’s historical rate will get you to the goal figure you need. For instance, if you want to retire with $2 million in 30 years, at a 7% rate of return, you would need to invest $1,700 a month.

Once you have your goal retirement amount and know how much you need to contribute to amass your golden goose egg, the final step is to ensure you can actually afford to make these regular contributions. How do you do this? You budget. I know I may have just sent shivers down your spine with that devilish six-letter word but if you don’t budget, how can you be certain you can ever afford to contribute what you need to retire early?

Now, if after creating your budget, you realize that there’s no way you can afford to contribute that much money a month, you have two choices. The first is to go make more money. I know that’s easier said than done but retiring early isn’t an easy goal to meet so you will have to put in the work to get there. The other option is to find ways to save more money. In fact, let’s dive into how saving affects your retirement efforts right now!


Number 2: Poor saving habits

When you think about it, retiring simply comes down to amassing enough money to never have to step foot in an office again. It’s for this reason that being able to save is rather important. Unfortunately, while saving seems like a simple task for some, for others it can be incredibly difficult and if you ask me there are three reasons why some people struggle with this aspect of their personal finances.

The first reason is that, and the one that is probably the most excusable, is where people are not earning enough money to save. Yes, this situation exists and it’s in part due to the fact that the Federal American minimum wage has not increased in over a decade. Right now, over 1 million Americans are earning the Federal minimum wage of $7.25 and when you’re collecting $500 checks every two weeks, even meeting your basic living needs will be a challenge let alone being able to stash away enough money to retire early.

Next, there are those who do make a livable wage but fail to take any accountability for how they manage their money. Their number one mistake? Failing to budget. I think it’s pretty obvious that it’s going to be hard to avoid overspending when you don’t know how much you can afford to spend in the first place. It’s kind of like our prior example of the map. You can only get to your final destination if you know which roads to follow to get there and in the context of your budget this equates to which and how much your expenses can cost you on a monthly basis.

The final group of people, and the ones who are the most culpable are those who make good money, have a budget yet ignore it and spend at will. We all know a few people whose wallets are bigger than their brains and as such they struggle to amass any significant wealth despite having all the tools to be successful.

Fortunately, there are solutions to each one of these problems. For the underearning, upping your skills or building new streams of income is a must. For those without a budget, drop your fear of spreadsheets and enter the world of adulthood. Finally, for those who overspend, just imagine yourself at 95 years old having to work because you just have to drive a fancy car and wear a different Rolex to work every single day.


Number 3: Inconsistent Investing

Generally speaking, being consistent is a good thing. For instance, being consistent in working out or eating healthy. Alternatively, being consistent can be bad when it’s your girlfriends nagging that’s becoming consistent or your boyfriend’s consistent need to watch the game over spending time with you. In short, consistency, when used the right way, is a powerful tool and it’s no different when it comes to investing.

As we already discussed, amassing enough money to retire is going to take a lot of regular contributions; however, this directly conflicts with people’s general lack of being able to stick things out over long periods of time. We all know someone who has started and restarted about 50 health kicks in their lifetime and just haven’t been able to make their good habits stick. Well, I’m here to tell you that without a plan in place to consistently invest towards your dream retirement life, you have no shot at retiring early!

Now, for some people, investing every month for the next few decades will be a breeze but generally speaking, life gets busy, people become forgetful and this becomes a more arduous task than it initially seems to be. As such, you have two options. The first option is to place your retirement success in the hands of luck. The second option is to set up a system to ensure you meet all your investing responsibilities and let me tell you with the memory I have, option two was the only option that was ever on the table.

As such, what I do and what I recommend to others is to set up automated contributions to your retirement account. Most brokerages allow you to automate a process that sends money from your bank to your retirement account which automatically invests into the funds you’ve preselected. This means that not only do you avoid the administrative hassle of regularly investing, but you avoid any risk of slowing down your path to retirement by missing contributions!


Number 4: Inflation

If you’ve made it this far then buckle up because shit’s about to get very real, very fast. One of the most overlooked threats to your retirement dreams is inflation. If you don’t know what inflation is, it’s defined as a general increase in prices and a fall in the purchasing value of money. You experience the impacts of this financial phenomenon all the time when you see more and more of your money leave your wallet when you go to buy groceries or fill up gas in your car.

Now, seeing the price of bread go up by 20 cents probably doesn’t seem like a big deal but it actually affects your financial future more than you’d expect. Let me share with you an example of just how punishing inflation can be on your future retirement plans.

Let’s say that your ultimate retirement goal is to retire with $1 million in the bank. If you started investing at age 20 and invested $500 a month for 30 years at 10%, you would amass your goal amount by the still very young age of 50. Seems simple enough right? Well, before you go planning your retirement party, we need to talk about inflation for a minute.

You see, you probably expect that $1 million will be enough during retirement because right now you see others around you retiring on this amount. However, what we must remember is that money now is not equivalent to what it will be worth in the future. In fact, when I share with you how much $1 million in 30 years will be worth in today’s money, you may just have second thoughts about retiring early all together.

If we assume inflation will be a consistent 2.5% for the next 30 years, when you amass $1 million, that money will actually be worth just over $475,000. Yes, this is still a lot of money but is it enough to retire on? I don’t think so. Therefore, when going through your own retirement planning process, make sure to factor in an expected rise in cost of living so that your saving efforts don’t fall flat and leave you stuck in the workforce for longer than you initially anticipated.


Number 5: A lack of purpose

Now, let’s say that you are able to sidestep all of the obstacles I’ve presented so far, there may be one unexpected challenge that still may stop you from retiring early. This final obstacle isn’t financial but that doesn’t mean it won’t stop you in your tracks. One aspect that many people find challenging when they retire, whether that’s when they’re 45, 65 or 85 is losing a sense of purpose in their work. I know it sounds a little strange, and maybe even perverse, but most people do gain a sense of fulfillment from their work, even if they would tell you that they despise the job they have. This is because as humans, we have a desire to contribute. Sometimes, that means contributing to worthy causes like helping the impoverished population in your community or less worthy causes like making your boss even richer than they already are. Regardless of which cause you are contributing to, in the end you are adding to something greater than yourself and whether you realize it or not, this resonates with you.

However, when you retire early, if you don’t have something to move onto that will fill that void then you may come to realize that retiring wasn’t what you hoped it would be.


Retirement could turn into a meaningless void if you don’t find worthwhile ventures to undertake. This is why when my own parents were retiring, I made sure they had ways to fill their time when they no longer would be going into work because it’s easy to start to decline when you feel you have no purpose in your day to day life.

Now, I know for some, the thought of having free time seems like a silly reason to not enjoy retirement but I think it’s one of those things you can only appreciate when it happens to you. Unfortunately, you won’t know how you will handle the retirement life until you step into it but I believe if you fill your days with enough enjoyable and stimulating activities then you can be sure to knock this item off your list of potential retirement obstacles!