retirement

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Financial Independence, Retire Early (FIRE)

FIRE is a financial movement of extreme savings and investment that allows proponents to retire far earlier than traditional budgets and retirement plans would allow.

  • By dedicating up to 70% of income to savings, followers of the FIRE movement may eventually be able to quit their jobs and live solely off small withdrawals from their portfolios decades before the conventional retirement age of 65.
  • To cover their living expenses after retiring at a young age, FIRE devotees make small withdrawals from their savings, typically around 3% to 4% yearly.

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Financial Independence, Retire Early (FIRE) Definition

investopedia.com

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Why you should plan to plan ahead for retirement.
  • Getting stuck in the savings mindset. Saving should be formed as a habit. The amount saved can be increased over time.
  • Medical emergencies. With increasing age comes more health problems. Medical claims might not always suffice.
  • Inflation needs to be taken into account.
  • No state-sponsored pension plan. Not all countries have state pensions or social security benefits.
  • Fragmentation of nuclear families.  With fewer children per family, retirement should be planned without help from your family.

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5 Reasons Why Retirement Planning Is Important

sg.theasianparent.com

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