We all find ourselves at multiple points in our lives playing around with our retirement numbers to find the optimal retirement point.
It’s the balance between having enough years left in you to enjoy life and enough money not to worry.
Both numbers are different for everyone. After all, I know plenty of people who have had to almost be forced into retirement because they love their job so much.
And sadly, I know others who’ve had to work later into life than they’d have liked because their retirement funds weren’t enough to provide the quality of life they’d like in their old age.
The average life expectancy in the USA is 78 based on this you could retire at 55 with $300k and have $13,043 to live on a year.
If you lived past 78 you’d be left with nothing but a state pension to live on.
These numbers are significantly lower than the national average. However, there are some things you can do in the lead up to retirement and during retirement which can make your money go further.
How To Retire At 55 With 300k
Before we delve into the money aspect of this article it’s first important you understand why you’re retiring at 55.
An while I don’t advocate for spending your 300k and starting a manual labour intensive new career I do advocate for looking at possible side hustles that might interest you.
Retirement isn’t as great as you may think.
Many of us long for retirement but when it comes around we quickly find ourselves fed up and life pretty damn unfulfilling.
That’s not the point of retirement.
Starting a small business, side hustle or passive income gig is the perfect way to learn a new skill, keep you busy and hopefully top up the nest egg.
Let’s assume you retire with 300k at 55 but decide to start a blog about golf – your one true passion!
You spend 1k on a course, a domain and some hosting and use the platform to share your opinion on different golfing products and knowledge about different courses and hints and tips for those wanting to increase their performance.
Provided you follow a course such as Project24 you’ll be making around 1k a month after 12 months from adverts running on your website and affiliate income (a percentage from a sale of products you promote)
All of this can be achieved with zero knowledge of technology and websites. All you need is the knowledge of your topic, a computer or laptop and access to the internet.
This side hustle will turn the 13k a year you had to live on from your initial 300k into 25k a year (13k from the 300k based on living until 78 + 1k per month from your blog)
Provided you maintained the blog so it continued to earn a reoccurring income you’d still have 1k to live on past age 78 (when you’re 300k has run out from your previous 23 years withdrawl)
Of course, blogging is just one example.
How To Make Your Money Go Further In Retirement
Aside from creating a source of passive income there are other things you can do to make your month go further in retirement.
Own Your Own Home
There are arguements for and against owning your own home in retirement.
However, given the fact you’re planning on retiring earlier I’d firmly suggest owning your home outright instead of renting.
While you will be responsible for the maintenance costs you’ll protect yourself from increased rental costs.
After all, a property that rents for $1,250 a month today may rent for $2,000 a month in 10 years as various suburb locations continue to develop and improve.
Grow Your Own Food
With time on your side, you’ll want to put your hobbies and skills to good use to make your money go further.
One great way to do this is by growing your own food.
Again while lettuce may cost $1 now, it may cost $2 in 10 or 20 years.
If this increase was applied across your entire grocery bill you’d be spending double the amount you are today.
If you don’t believe this is possible, take a look at this article which found that the average cost of groceries has increased 20% over the last 10 years.
Find Cheap Hobbies
Retirement is a great time to rekindle the love of a hobby which you had no time for while working.
However, hobbies are expensive.
If you’re to make your 300k last in retirement you’re going to want to find affordable hobbies.
Ideally ones such as gardening which keep you active and also provide you with money-saving results (such as food!)
Consider Getting A Part Time Job
One way to increase the additional income you have in retirement is to get a part time job.
Okay, it’s not quite retirement if you get a part time job.
However, the job could be in a completely different industry and being part-time could significantly reduce your workload and stress.
Reducing your hours from a full-time job of around 45 hours a week down to a part-time job of just 6 to 20 hours a week is the perfect way to gain an insight into what retirement might be like.
The part-time income could be used to help you achieve future-proofing your retirement by purchasing gardening equipment, paying off your mortgage, repairing your home or starting a passive income stream.
Retiring at 55 with 300k is only going to be possible if you’re already used to living a frugal lifestyle.
However, if you’re currently spending 50k a year, then scaling that back to 13k in retirement is going to be near to impossible.
Ultimately, you’ll need to look at why you want to retire and what you want from retirement.
After all, it’s pointless retiring at 55 if you’re going to be unhappy. That’s not the goal of retirement.
Only then will you truly be able to see whether retirement on 300k at 55 is right for you.