RETIREMENT INVESTING - GETTING THERE

I usually write this column thinking of people who are already retired. However, because I am often asked, what is the trick to achieving retirement, and particularly early retirement, I am writing this month’s article with a younger reader in mind. Retiring early is not a complicated thing to do. That doesn’t mean it’s easy, it’s just not that complicated. There are really three essential components to being able to retire early, or to any other financial accomplishment. I am sure everyone has heard them before. First, set ambitious but attainable goals and objectives. Second, don’t confuse “needs” with “wants.” Lastly, develop a strong sense of self discipline. I know hearing the “goals and objectives” thing seems so obvious that you probably wonder why I even bother to write it. I apologize, but goal setting is essential to any successful endeavor. If you don’t know where you are going, you will never get there. Set a goal. Make a plan. Check your progress frequently. If you make a wrong turn, check the map, change course and start going in the right direction again. Confusing “needs” and “wants” is another significant impediment to achieving desired financial results. Examples abound. I am going to confront the emotionally charged area of education to explore this cauldron of confusion I call “needs” and “wants.” If you can get your arms around education, you can handle just about any other issue (shelter, transportation, life style) in this financial danger zone. Education is “need.¨ it is essential. Education is a process

of obtaining the tools, knowledge and perspective necessary to help us navigate our future as successfully and emotionally satisfied as possible. That said, there is very much that education is not. An unbelievable amount of unfocused expense and debt are generated in the name of educational need. Unfortunately, what is often being pursued as an educational need is a series of wants camouflaged by a cap and gown. How one balances the realistic “needs¨ versus “wants¨ of obtaining or providing an education will have a significant impact on future financial decisions. Remember, more work and a realistic approach to an education, will result in less debt. It will also provide a sense of accomplishment and self confidence. There is no curriculum more beneficial than deserved self confidence, stemming from realistic assessment and accomplishment, when matriculating through life. Being able to differentiate between what is truly “needed” and not being swept away by the cross currents of what is simply “wanted” will have a profound influence on the financial future. Lastly, to achieve financial objectives, a strong sense of self discipline is needed. There are three rules. These rules are never, never, never spend more than you earn. After the first three rules are mastered it is essential to start living on less than is earned. The less spent the better. Not only can it be done but it has to be done to achieve most financial goals. Like I said, it’s not complicated. It’s just not easy. But it is certainly possible.