An Introduction To Semi-Retirement For Beginners
Retirement seems out of reach for many people. Semi-retirement is growing in popularity. This is an introduction to semi-retirement for beginners.
Retirement used to be the goal. Semi-retirement has become more popular. The concept is becoming more well-known. Here is an introduction to semi-retirement for beginners.
What Is Semi-Retirement?
SmartAsset defines semi-retirement as” Semi-retirement is a period of time during which a person stops working full-time in their previous career and begins working fewer hours or, perhaps, putting regular workweeks at some money-earning pursuit that they find more enjoyable and rewarding.”
It is also a concept that a person can continue working to some degree after reaching retirement age. Rather than retiring, a person can work to a lesser degree. A person may have been able to find ways to create passive income streams to allow them to have fewer active hours.
The Internet has played a critical role in allowing people to be able to semi-retire.
Semi-Retirement As The New Goal
Semi-retirement has become the new goal for younger people. Many realize that they likely will never be able to make enough to fully retire. Instead, they are choosing to find ways to make extra income. The additional income streams can help them to save, invest, or start their own online business.
When I use a keyword search tool for blog ideas, search terms that are sent back include:
Can I Sem-Retire At 45?
Is Semi-Retirement A Good Idea?
Semi-Retirement and Social Security
More young people are beginning to realize that the old way of working your way up at a company or in a career and then getting a nice retirement package is no longer how the economy and most employers work. This requires younger generations to find a solution and accept self-responsibility for their financial future.
How To Semi-Retire
Semi-retirement requires work. Work is a part of life. Semi-retirement just may allow you to find ways to reduce the amount of time you have to work to enjoy semi-retirement.
There are two main types of income: active and passive income. Active income, you trade your time for money. Passive income is when you earn money by selling a product or service, interest, or on an investment.
There will have to be some active income to cover the costs if you do not have enough passive income to live on every month.
Types of Passive Income
There are many types of passive income. Passive income streams include:
Dividend-paying stocks
Real estate rentals
Royalties from books, photos, videos, music
Money market accounts and high-interest savings accounts
Move To A Less Expensive State Or Country
Move to where you can get the most bang for your buck. That could mean moving to a less expensive state or country. It may be a good idea to avoid living in the larger cities since the cost is usually higher. If you work remotely, own an online business, or can freelance, you could work in a less expensive part of a state or move to a cheaper country.
Find a location that meets your lifestyle expectations. Offers you activities that you enjoy doing but may cost less. For example, it will cost more to live in Florida than in a South American country.
Least Expensive States
If you live in the United States, consider moving to a cheaper state. U.S. News and World Report ranks the following ten states as the most affordable:
Mississippi
Alabama
Arkansas
Kentucky
West Virginia
Iowa
Oklahoma
South Dakota
Louisiana
New Mexico
Other variables should be taken into consideration when moving to a state:
Property tax
Income tax
Capital gains tax
If you could see yourself living in the state
If you can move to the state for work.
Another option is to move to another country. This strategy could save you even more money, depending on the country you choose to live in part-time or full-time.
Least Expensive Countries
According to the website A lot, the thirty cheapest countries to live in are:
France
Germany
Costa Rica
South Korea
United Kingdom
Israel
Philippines
Canada
Mexico
Brazil
Colombia
Hong Kong
Australia
Japan
Pakistan
Italy
United Arab Emirates (UAE)
Haiti
Saudi Arabia
Argentina
Spain
Norway
The Bahamas
Russia
Lebanon
Panama
El Salvador
New Zealand
Ireland
China
Make A List Of What Is Most Important To You
Write down the things that are most important to you. Some things that people may take into consideration when deciding to move to another country are:
What is the cost of living?
How much does it cost to rent?
How much does it cost to buy a condo or a house?
What is the weather like?
What is the culture like?
Is there a large enough expat culture that I am looking for?
What is the country’s political structure?
How is the rule of law in the country?
Can I meet someone in the country if I want to date or marry?
Can I get a second passport?
Can I become a resident or citizen of the country?
Do I need to pay taxes in that country and my home country?
Live Below Your Means
Living below your means is a common theme throughout personal finance. It is the foundation of money management. Living below one’s means allows you to save and invest money. You can have money for the future and plan for a rainy day.
Save and Invest The Difference
The money you save from working or a business, make sure to save and invest the difference. You may be able to save a larger portion of your monthly income by living in a country with a lower cost of living.
Save In A Money Market Account
Look online and save money in a money market account. The MMA I use currently has 5.30% APY compounded daily by Vio Bank. There are plenty of money market account options available online. Just do some quick research and find one that meets your criteria.
Save In A High-Yield Savings Account
Save money in a high-interest savings account. Look online to find the top high-yielding savings accounts. Once you have met the $250,000 FDIC limit in one account, transfer money to another savings or money market account.
Save In A Certificate Of Deposit (CD)
A certificate of deposit (CD) is when money is given to the bank for a certain period. The funds will receive an agreed-upon annual percentage yield (APY) that compounds daily. CDs can be found for as short as one month to as long as a few years.
Invest In Assets
There are a range of assets that you can invest in. Common assets are businesses, real estate, and the stock market. Consider starting an online business. Invest in real estate by renting, AirBnB a spare bedroom or house, or flip houses. Come up with an investment strategy for the stock market.
It is vital to find ways to make your money work for you. Build passive income streams.
Steps I Am Taking To Semi-Retire
The steps I am taking to semi-retire are to build my Substack. I am also working to self-publish books on Amazon.
I am also planning to move to a less expensive country eventually. I am looking at a country in South America. From the videos I have weathered and articles I have read, I could live well in that country for roughly $2k-$3k a month. I could buy a relatively new house or condo for half the price of most real estate in the United States. I would then also be able to get a second passport and become a resident of the country.
That is the main reason why I am working to grow my online business by self-publishing on Amazon. I am already working on my next book. Growing my Substack and finding ways to create income streams.
For readers who are interested in the semi-retirement concept, there is nothing preventing you from doing the same thing. It just requires action and coming up with a plan to make it a reality.
Secure Single’s Algorithm recommends:
Summary
Semi-retirement is rising in popularity as a result of the Internet. People can now work online. There is no need to stay forever at one company. A person can work remotely for different employers as a contractor or start their own online business.
What do you think of semi-retirement? What steps are you taking to semi-retire? How can you work to reach your financial goals this year? Let us know in the comments below!