We all know that the secret to retiring early is to save lots of money during your working years. If you want to save money, you need to get into the habit of spending less than you earn. You should also be paying yourself first. I figure that you already know that by now. Today we’re going to go in a different direction.

I find that the biggest problem for most of us is spending money on crap.

Over the years I’ve come to hate crap. I hate buying stuff. I hate when people try to sell me stuff. I don’t want any clutter in my room or around me. I want to be as clutter free as possible. I would rather save my money or spend it on experiences. Maybe that’s just me.

Now don’t get me wrong, I do believe in paying for value. If I view a purchase ( a book for example) as am investment then I have no problem with handing over the money. I just don’t want more stuff. There’s no need for more crap.

Where’s this coming from? Every time I travel friends ask me about souvenirs and gifts. When I go on the trip I find many opportunities to buy crap. I just can’t handle them though. I don’t want to buy more stuff. I hate being asked to buy stuff.

When you go somewhere new or even when you leave your home, there will be a plethora of chances for you to spend your money. The problem is that we’re all susceptible to marketing and the influence of advertising. All of us have made a foolish purchase at one point or another. If you want to save for retirement or other areas, you simply need to cut out the amount of crap that you buy.

The truth is that buying more stuff will always hold you back because you’ll always find another reason to spend your money. In any given day you can buy something new. Just by going online you can grab something new. Everything that you do is an opportunity to buy something new. It’s fine to make a new purchase once in a while, but do you really have to keep on buying crap?

Every occasion that you pull out your credit card or cash to buy something is simply another excuse to take money away from your retirement.

Do you want to work longer just because you bought all of that clutter? I’m pretty sure that the answer is no. I’m not here to preach to you. This post is just another reminder of how buying more crap will negatively impact your retirement. You come here because you’re serious about your retirement planning. You’ll never be able to retire early if you keep on pulling out your credit card to spend money whenever a new opportunity comes your way.

Will you keep on buying more stuff or will you save towards your retirement? The choice is all yours.

How do people retire?

The obvious answer is that they stop working. But really, how do people retire? I’ve always wondered about how people come up with their retirement plan. As we all know, not everyone retires at the same age or the same time. Everyone has a different retirement plan. For some reason this topic really interests me. I was so interested that I had a chat with an older friend.

Below are the main reasons and ways that people retire…

They turn 65 years old.

Many individuals will retire because they hit the retirement age. They count down and wait until they’re old enough to call it quits. When they hit the golden age, the stop working immediately. For some this age is far too old and some have to work past this age.

The savings goal is met.

I’ve been told that some couples wait until they hit a certain savings goal. Once they hit this savings target they know that they’ll be comfortable with retirement and they stop working. The beauty of this is that in your younger years you’re always working towards something. You have a clear target and you do everything that you can to reach it. This is unfortunately a unique option because not all couples will be able to hit their savings goal before the retirement age.

Health turns for the worst.

Not to be morbid, but sadly some folks will have to stop working because of their health. If you physically can’t work, then you’ll be forced to retire. I hope that this doesn’t happen to you.

Tenure allows the person to retire.

If you work in a unionized environment then you can retire once you’ve hit your tenure. One of my friends got a new government job and he was telling me how he can quit after 25 years because that’s the seniority age at the company. This means that if you start early you can retire at a young age.

Company changes.

There’s a variety of ways that you can retire as a result of company changes. Below are a few examples of retiring due to your company:

• You hate your new boss.
• Your company down-sizes.
• The company gives you an incentive to leave.
• The firm moves locations.

My friend’s dad was shown the door by his company before he was financially ready to retire. The company gave him a decent package but he still wasn’t done with building his savings.

You want a lifestyle change.

You may get sick of shovelling your driveway in your 60s and be eager to find a lifestyle change. Next thing you know and you’re laying on the beaches of Florida. When you plan properly and save your money, you can have the luxury of retiring simply because you want a different lifestyle. I hope that all of you reading this reach this level.

At the end of the day, retirement planning is ideally done at an early age. In reality, there are many ways that people retire. All that I suggest is that you do your best for your retirement. All you can do is hope for the best. You never know when your health can take a nose dive or your company decides to down-size. All you can do is prepare yourself as much as possible. In my finance class this was referred to as trying to hedge against unforeseen circumstances.

How will you retire?

Do you know anyone over 65 that’s still working? The other day I was chatting with one of the supervisors at my part-time job. This individual just turned 65. I was at his birthday dinner. A few months after his birthday I asked him what his plans were. He didn’t have any plans. He told me that he wants to continue working until they ask him to leave (retirement package or flat out fire him). I was sort of surprised by this. I wanted to learn more about why someone that was smart with managing money would want to work still. This led to an interesting discussion.

When it does it make sense to work past the age of 65?

Insurance coverage.

This gentleman is in an unfortunate situation. His wife is chronically ill and her medication is very expensive. Fortunately, his insurance coverage pays for the medication since his wife is unable to work. The problem is that now he can’t quit his job. If he no longer has coverage, he’s going to have to pay for the medication out of his own pocket.

We often forget to consider insurance and coverage when it comes to life post-retirement. We assume that we’re going to be totally healthy. Sadly, this isn’t always the case. Anything can happen when it comes to health.

Lifestyle situation.

You may find this funny but some seniors don’t have a life outside of work.

For whatever reason you could find yourself with your co-workers being closer to you than your blood family. If your partner passes away, kids move on, and friends are no longer around, your co-workers may be all that you have left. You have to see these people five days a week for possibly 30 years. You’re bound to be come family. You might see some of your fellow employees more often than you get to see your own family.

Another point to bring in here is that life can be pretty lonely for some. Where my friend works, an employee was forced into retirement at 70 years of age. The company just couldn’t have him around any longer. He came back begging to work part-time because he just couldn’t handle life without work. He didn’t know what to do with his time. Being at home just made him think of his family members that have passed away.

For some elderly folks, work is all that they have left.

Why’s it foolish to work over 65?

Tax issues.

If you have a government pension, retirement accounts, and a full-time source of income, this could cause some trouble with taxes. The government doesn’t want you making all that money when you’re getting a pension. This could cause some penalties with the tax man. I’ve been told my older friends that it’s not really worth working post-retirement due to tax issues.

You worked hard your whole life.

You worked your entire life. You deserve some rest. These are your golden years. These are the years where you’re supposed to relax and enjoy yourself. If you didn’t get rich by 65, the odds are that you won’t make a fortune in your final years.

Do you see yourself working over the age of 65? When do you plan on quitting? What would you do if you had to work until your late 60s?