Retiring young

How young is too young to retire? I meet people in their 20s living a travelling life of part time work throughout the year. That is full time work for 3, 6 or 9 months of the year and then spending the remaining time travelling to an overseas destination.

This is normally a developing country where the currency conversion is good and the cost of living is cheap. The plan is usually work in a country with a strong currency and a high cost of living coupled with high salaries to compensate for the cost of living.

Is this really retiring? No, not at all because to retire is to give up work completely. However, there is always a caveat because a retiree can engage in a little part time work to keep themselves busy and to supplement their retirement income. The next group is in their 30s, they have had a decade or so of employment and have either been extremely well paid, developed a successful business or come into money through a lottery win, inheritance or marriage.

They could have a successful travel blog, Instagram page, YouTube channel or some other electronic business to generate an income whilst travelling the world. There is always family money, that can come at any age but who really wants to live off their parent's money? I was lucky enough to be able to work half a year and travel half a year in my late 20s right up to my mid 30s before rejoining the workforce full time again at age 37. I still get to travel overseas on a regular basis anywhere from three to five trips a year, but it is short term travel of two weeks duration these days.

That decade was the greatest period of my life in terms of lifestyle but a real career killer - not that I'm complaining. I had to re-enter the workforce to ensure my retirement was looked after. I needed to pull my head in and get serious about contributing to my superannuation fund. I was lucky enough to join the state government at the right time and still be able to join the state government retirement fund before they clamped down on the conditions.

The majority of people I have come across who have retired early are in their 40s, they have had enough time in the workforce to save for an early retirement, they could sell a business, derive an income from investments or received an inheritance. These people have sold businesses, have investment accounts and own property and I have seen people rent out their house to travel.

Living in low cost of living countries and owning properties allows them to live a relaxed lifestyle and their property usually appreciates in value. I have come across a number of people living in the Philippines in their 40s and 50s who owned their property that is rented out. This is a great strategy, owning just a single property allows a retired lifestyle of relaxation.

Most of the guys I have met through scuba diving so these guys have a job in a dive centre but there isn't much work involved. In the low cost wage world of developing countries where locals are hired to wash the equipment, fill cylinders, carry equipment, boat crew and equipment repair; all they have to do is step on the boat and hang around the dive centre chatting to people before and after dives.

The last group I come across in the Philippines directly after the global financial crisis was a bunch of London stockbrokers, finance guys and IT people. They were displaced, they lost all their benefits, their income and their lifestyle. They were hanging out in a developing country where the living was cheap and the diving is good, some of them were still working remotely via virtual teams.

After diving they would have to go back home and log on and work; every now and again they would have to fly to Hong Kong for a series of face-to-face meetings. I never discussed income with them so I don't know how good their deal is, I'm guessing their cost of living and their lifestyle more than adequately compensates them. Maybe semi-retirement can be achieved through a lifestyle change and low-cost living, the people I meet seem to be enjoying their new status and lifestyle.