Members of Generation X are approaching retirement age, but many of us aren’t ready for it. The majority of Gen Xers (56%) have less than $100,000 saved for retirement and there isn’t much time left to add to that. Only a third of us think we can retire by the age of 65. Things are getting worse with rising inflation and a changing economy. Retirement looks bleak for Generation X.
For those of us who want a traditional retirement, the solution is easy. We just need to save more. Save 50% of your income and you’ll probably be able to retire by age 65. It’s easy to say, but impossible to achieve. If you haven’t saved for retirement, there’s no chance your saving can go from 0% to 50%. However, this is not the end of the world. We are the rebellious generation. If you can’t retire like your parents, you need to find a renegade replacement. Instead of slacking off into a leisurely retirement, build an engaging life from which you don’t have to retire.
Build a life you don’t have to retire from
What life do you have to retire from? The basic idea is to figure out a way to thrive financially without your day job. Yes, this is possible. Many people have done it. I no longer have a day job, but I still work part time. I’m doing very well financially and I don’t have to deal with a toxic work environment. I am enjoying life now rather than waiting for the traditional retirement. Here’s how to build a life you don’t have to retire from.
Build your non-employment income
The first step is to build your non-employment income. Most people depend on their day jobs just to make a living. That’s perfectly fine for a lot of people, but not for those of us who aren’t happy with our careers. I knew I couldn’t afford another 5 years into my old stressful engineering career, let alone 20. The way out is to build other income streams outside of the day job. This is not easy and the amount of income will be very small when you are first starting out. You need to keep working on it and eventually, your income streams will come to a significant amount.
Here are some ways to make money outside of your business.
- Invest in real estateHere’s a piece of advice for everyone. Your home is not a great investment. You have to spend a lot of money on maintenance and the value may or may not increase. It’s better than renting, but it’s not a great investment. It generates no income. For real estate, I invest with CrowdStreet and my investment generates good passive income. Check them out to see what projects they offer.
- property rental – Many people retired early with rental properties. Once you get a few rents with a good income, you will most likely be able to quit your job. Being a landlord isn’t for everyone, but it is one of the best ways to make money outside of work.
- distributed shares – I love my dividend portfolio. This year it will bring us over $10,000 in passive income and it doesn’t take much effort. The stock market can be volatile, but good dividend stocks will still put money in your pocket.
- Lending money There are many ways to lend your money. You can invest in CDs, corporate and government bonds, or hard lending. I try to add some money to our I-bond every year. After Mrs. RB40 retires, we can withdraw from this account.
- sharing The sharing economy is booming. You can rent a room, share your car, rent your parking spot and sell your old stuff. These are all great ways to make a little cash on the side.
- driving – If you are a good driver, this is an easy way to earn extra income.
- free work Work part time on projects you enjoy.
- blogging – I do not recommend blogging. It’s a lot of work and you have to be very lucky to make money. Instead, I think creating video content is a better option these days. YouTube and Tiktok are the way to go.
- Start a small business – You can open an online store, a sitting place, or a kennel. The possibilities are endless. Try different things and see what works.
- Income from hobbies – You can take advantage of your hobby to earn money. One of my friends deejays on the side and makes a little money while having fun. You are an expert in your hobby and newcomers will gladly pay for it.
- how You Make money outside of your business?
There are many ways to make money outside of your day job. You just have to try different things and see if you like it better than the day job.
It’s great to make extra income on the side, but it will take a long time to get over the income from your day job. I’ve never been able to get over my old salary, but that’s not a huge deal since I have passive income. Fortunately, we do not have to go beyond the income from our daily work. We just need to be able to pay our monthly expenses and that can be controlled. The key here is to reduce your expenses to a level that works for you. Some of us can live on $5,000 a month and some of us can’t.
Since I got married, I’ve only targeted 50% of our expenses. We spend about $5,000 a month and my non-job income could cover 50% of that when I retired in 2012. Fortunately, our investments have paid off huge gains since then. Now, our passive income can cover 100% of our expenses. Ms. RB40 can leave her job whenever she wants. However, she wants to work so our son can go to college. It’s still good to have options.
Of course, the less you spend, the more money you’ll save. I saved all my income from home for two years before I quit my job. This gave our passive income a huge boost and also boosted my confidence that we would be fine.
Here you are. This is one way to build a life that you don’t have to retire from. You should be able to pay the bills without your day job. The key is to generate passive income, make money doing something you enjoy, and keep your spending reasonable. This is the new retirement and more people are facing the challenge. We enjoy life and do the things we want to do. Traditional retirement is not very tempting and we prefer to work a little bit every day. As we get older, we will reduce our hours and work less. Maybe I’ll keep working out a little bit even after 65. This will come sooner than I’d like, but that’s life.
Are you challenged to build a life from which you don’t have to retire?
Passive income is the key to early retirement. This year, Joe is investing in commercial real estate with CrowdStreet. They have many projects all over the USA so check them out!
Joe also highly recommends Personal Capital to DIY investors. They have many useful tools that will help you reach financial independence.
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