Description: Early retirement is the act of leaving the workforce before reaching the traditional retirement age, which typically falls between 65 and 67 years in many countries. This concept has gained popularity in recent decades, especially among those seeking a higher quality of life, time to enjoy hobbies, or to dedicate themselves to personal projects. Early retirement not only involves stopping work but also the financial planning necessary to sustain oneself without a regular labor income. This requires a strategic approach to saving, investing, and managing expenses. Individuals who choose this option often have a strong desire for freedom and flexibility, seeking to escape work-related stress and enjoy a fuller life. However, it is crucial for those considering this alternative to evaluate their long-term finances, as the lack of income can impact their economic stability in the future. Early retirement can be seen as a lifestyle that prioritizes personal well-being and the fulfillment of dreams, although it also carries significant challenges in terms of planning and financial sustainability.
History: The concept of early retirement began to gain attention in the 1960s when social security policies were introduced in various countries allowing workers to retire before the standard age. However, it was in the 1990s that the FIRE (Financial Independence, Retire Early) movement began to take shape, promoting the idea of achieving financial independence as early as possible to retire early. This movement has been driven by growing dissatisfaction with traditional work and the desire for a more balanced life.
Uses: Early retirement is primarily used as a financial planning strategy, where individuals seek to accumulate enough savings and investments to sustain themselves without labor income. It is also applied in career change contexts, where people decide to leave stressful jobs to pursue passions or start their own businesses. Additionally, it is common in communities that promote minimalist and sustainable lifestyles.
Examples: An example of early retirement is the case of individuals who manage to save and invest aggressively during their working years, allowing them to retire at age 50 and dedicate themselves to traveling or volunteer projects. Another example is those who, after a career in a corporate job, decide to start their own business that allows them to have a flexible schedule and enjoy their free time.
