For many of us, retiring early is a cherished dream. Only thing: we are unable to take the plunge.
We worry that we could miss the job we seem to now despise, and fear we could run out of our money, sooner than later.
For some of us, it is not even the dissatisfaction with work, the crazy hours and late night meetings.
It is about the inability to pursue what we want to do most -- to sing, to paint, to travel, to work with the underprivileged, to make a difference without measuring success by the salary and the designation.
An online search will throw up about a hundred useful web sites. And there is no dearth of books available. But the gist, listed by those who have been there, done it, are presented here.
Step 1. Be passionate about your pursuit
Those who quit their jobs without a goal in mind were the ones that got bored.
Those who stayed put turned out to be excellent landscape artists, accomplished musicians, authors, teachers, cooks, trekkers, social workers, childcare and old age care specialists, and the like.
So it is important to have the burning desire to do something that brings you joy.
It helps if you already have a hobby and are passionate about it.
Clarity on your post-retirement pursuit is the key to enjoying your new status of being on your own.
Step 2. Being frugal right now helps
You need to be hard-nosed about making choices that help your money run longer.
The savings on your wardrobe and food can be considerable!
No, you do not have to make lifestyle changes that make you cringe in your social circles. You just need to make intelligent choices about how you keep and spend your money.
And, yes, try your level best to go slow on loans.
Try to keep debts of all kind away -- car loans, credit cards, consumer durable loans and the like. Perhaps a home loan could still run with you because of the tax benefits.
Step 3. Invest smartly
If you are not an equity investor, there is a good chance that you have not accumulated enough wealth, or could find yourself struggling to meet inflation-adjusted expenses after you retire.
It is essential to accumulate wealth even as you earn.
Deploy your earnings in equity with the eye of a wealth-builder, so you have a large enough amount to run for you.
The advantage of retiring early is that you still have age on your side and can risk going in for an equity portfolio.
Use the 15 to 20 years of work to build a portfolio assiduously, so you have dividends and income flowing off it for the next 30 to 40 years. Without that nest egg, retiring early can be disastrous.
Equity should continue to be your preferred investment choice, if you expect your savings to last your lifetime.
Step 4. Provide for the essentials
It helps having life, health and disability insurance. Medical bills can be an important drain on your resources, if you have not bought adequate cover.
If you still have commitments that require large sums of money -- children's education, marriage, large home loan -- make sure you have provided for them all. Your ability to take on a huge expense could be lower after you retire.
If you cannot complete them all before you retire, plan for the large withdrawals from your nest egg, well in advance.
To a young person, a crore seems more than adequate to splurge about. But all withdrawals impact the returns on your savings.
Be sure you are in control. It could be wise to look at an annuity to fund part of your requirement, while keeping close tabs on how your equity investments are doing.
Step 5. Plan your withdrawals
Once you have accumulated your wealth, it is important to estimate how and how much you will draw down every year.
If you augment the income with some earnings from your post-retirement interests, it helps.
It pays to draw a plan of your needs for income and estimate how long your money will last.
If you have saved Rs 1 crore (Rs 10 million), and assuming a withdrawal of Rs 6 lakh (Rs 600,000) per annum; an inflation of 4%; and an investment return of 8% per annum, your money will last 25 years.
Use a worksheet to juggle these numbers around.
You must achieve a large enough nest egg to ensure two tings: your investments grow at a higher than the rate of inflation. And the rate of withdrawal ensures your money lasts.
Step 6. Have the right attitude
If you love your business suits and expensive perfume, your swank home in the heart of the city, your chauffeur-driven car and clubhouse, and you just can't fly Economy class, you may not be ready to quit. Yet!
What looks like a given on job is a drain on your saved resources once you leave.
A villa with a lawn overlooking the hills could come for a fraction of price of your city home, only if you are sure that is the right choice for you and are happy about it.
The crux is to know what you enjoy doing and to be sure you don't barter the joy for anything else.
If you are bogged down by your social circles' view of your decision, or have only the half-hearted support of your family, and cringe at being miserly (even if in private), you probably lack the emotional strength to follow your dreams.
Acknowledge the limitation, rather than live cribbing and carping about your call.
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