How to Retire Early 

Let’s face it, most people want to stop working as soon as they can possibly afford it – yet very few can afford it before they are forced to retire. By following these steps, however, you can give yourself a much better chance of retiring early.

Save, Save, Save

Saving isn’t easy and sometimes it is downright impossible, but it’s one of the most important financial habits that you need to develop if you want to retire at 45. Learn to save as much of your monthly income as possible, from as early an age as possible. If you can save 25% of your income from the age of 20, you’ll have a good chance of retiring at 45. The later you start saving, however, the more you’ll need to save to reach that same goal.

While saving might not be easy, here are some tips to help you on your way:

1. Set a Goal

Having a savings goal will help you to have a real, tangible finish line that you aim for, and it also comes with a great feeling of accomplishment once you have reached that goal. It doesn’t matter whether you are aiming to save 20% of your salary, or whether you are looking to put away R25 000 before the year end, make sure you know what your ultimate goal is.

2. Save First

Most people will put whatever they have left in the bank at the end of each month into their savings – and more often than not, this is either very limited or doesn’t amount to anything at all. This is the wrong way to go about it. You need to make sure that you put money into your savings the same way you pay your debts – the moment you get your paycheque. 

You can usually set up an automatic transfer into your savings account right from your bank each month – so you won’t even see the money before it gets transferred into your savings account.

3. Separate Your Savings

Every household should have two types of savings accounts – one for emergencies and one that is set aside for the long-term (including retirement). You need to have a strict set of rules for withdrawing from the emergency fund, which could include car breakdowns and hospital bills.

2. Avoid Debt

Any debt is going to prevent you from retiring early, so try to steer clear of it as much as possible. If you do have debt – especially high-interest debt – it’s better to focus on paying that off before you start saving.


3. Start Investing

Once you’ve started to save a large portion of your income, you can then focus on putting that money to work for you, and this is usually best done through compounding interest. Investing in stocks allows you to diversify your portfolio – allowing you to make investments into different companies in different geographic areas. This ultimately protects you in the event that something goes wrong with one particular type of stock in one specific area.

4. Be Tax Savvy

Make sure you use your tax allowances and pensions in the best possible way. If your company is offering a matching pension (where they match the amount you put in), be sure to take full advantage of this by increasing your pension to as much as is affordable.


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LifeGap teaches you what you need to know to be prepared for the “Real World”. The book is divided into three sections; Personal, Financial and Governmental.