Retire at 40
Like the idea of doing nothing but travelling, pursuing your passions or anything else you fancy at the age of 40? If so, you need to hear more about FIRE, a movement of millennials aiming to retire by the time they turn 40. This seemingly impossible dream could be within reach for anyone who commits to saving regularly while investing cleverly in shares and bonds. Yuh offers the ideal platform for long-term savings and smart investments.
FIRE your way to financial independence
How would you like to choose when you retire – and what if you could do it by the age of 40? If you like the sound of this, you might already be a member of the growing global FIRE movement. Its followers reject the “live to work” motto that influenced older generations, instead focusing all their attention on reaching the stage in life when they will no longer need to work. They want this phase to last as long as possible and start after only ten or 20 years of employment – around the age of 40. After that, they want to live – as the mood takes them, and with a clear financial plan. After all, you can only retire at 40 if you live frugally while investing part of your savings wisely.
The 4% rule
FIRE stands for ‘Financial Independence, Retire Early’. To turn this dream into reality, FIRE devotees stick to the universal 4% rule developed in the 90s to reassure pensioners who worried that their money would not be enough to see them through old age. First, it's essential to know how much you can save during your professional years. Secondly, you need to work out precisely how much money you need to be financially independent and free for the rest of your life. The 4% rule assumes that you can achieve a 4% return on invested capital in the long run by making clever investments. You can withdraw this money without disturbing the original capital. To follow this rule, it’s vital to know what retirement assets you will need. To work this out, simply multiply the amount you would like to spend each year of your retirement by 25, so if you think you’ll need CHF 40,000 a year to live, you need CHF 1 million in assets. As a result, it makes sense to draw up a budget of fixed costs (housing and other costs), variable costs (debt repayments, energy costs) and one-off expenses (holidays).
Invest and save with Yuh
Whether you’re now the latest convert to the FIRE movement or pursuing your own savings and investment goals, you need to plan the simplest way to turn your financial dreams into reality – a plan that allows you to make progress while staying motivated. It’s also important to have oversight and control of your account at all times so that you can invest, move and withdraw your money. Saving can be fun if you are your own banker, working towards a particular goal. To get more out of your money, it’s always a good idea to draw up a budget of what you can invest. There are many ways to combine your investments with your interests and passions. You can invest in specific areas and issues, from gaming and vegetarianism to cannabis and cryptocurrencies. You can invest in the theme or currency of your choice. No matter what you decide, make sure you set an upper limit for your investments, as there is always the risk that you will lose your money when investing. Whatever your financial dreams and desires, the Yuh app is the perfect way to make a plan and achieve your goals.
Is FIRE right for you?
Financial independence certainly sounds appealing, and the Yuh app gives you the tools to make your savings and investment plans a reality. Yet it is also a big challenge. After all, to retire at 40 you need to be a ruthless saver. This means giving up a lot to avoid spending money unnecessarily. What’s more, investing always involves risks. There are no guarantees that your investments will be successful. Yet one thing is certain – you will learn how to make your money go further and how to manage savings and investments. And if you ever decide that the FIRE movement isn't for you after all, you’ll have plenty of new expertise, more money in your account and a whole host of smart investment strategies at your fingertips.