What to Know about Planning to Retire Early

13 May 2022 By Oliver Maher
iStock/Peter Bajohr
Oliver Maher

Oliver Maher is a director at United Advisers Marine. Disclaimer: UA/BFMI is a member of Nexus Global and an appointed Representative of Blacktower Financial Management (International) Limited (BFMI). BFMI is licensed and regulated by the Gibraltar Financial Services Commission (FSC). UA/BFMI are not tax advisers and clients should always seek independent tax advice for their individual circumstances. +34 871 115 928;

At a time when many people feel like they’re working more than ever, some are going to great lengths to never lift a finger again.

The “FIRE” movement has grown in popularity in recent years, with people around the world dreaming of the day they achieve Financial Independence and Retire Early. The idea is that by being frugal, paying off debt, and investing aggressively in your 20s and 30s, you could stop working in your 40s and live off the wealth you’ve built. Those who’ve achieved FIRE tend to make money from their stock market portfolios, rent from investment properties, or other forms of passive income.

Who wouldn’t want the freedom to wake up at lunchtime each day, sail around the world, and never have to report to a bad boss again? For some, FIRE is about waving goodbye to workplace politics, spending more time with their children, or prioritizing their passions rather than being driven by a salary.

 It’s wise to plan for the future, but a balance needs to be found. After all, tomorrow isn’t guaranteed.

Although achieving FIRE has multiple benefits, the movement is certainly divisive. Some people have accused it of encouraging workaholism and an “all work and no play” mentality. While the end-goal might be to never work again, most people have to do a lot of overtime to get to that point. If they dislike their job, they can end up putting themselves under incredible stress in the meantime. Some people consistently work 12-hour shifts, avoid socializing with friends, and become obsessed with counting every penny. It’s wise to plan for the future, but a balance needs to be found. After all, tomorrow isn’t guaranteed.

In our 2020 Superyacht Crew Financial Wellbeing Survey, more than half of all respondents lacked the financial freedom to leave yachting when they want. To follow in the footsteps of the FIRE community, here are a few things to consider:

Saving into a pension can have numerous tax advantages that can be hard to replicate through other types of investment. If you have access to a pension through your employer, it’s worth making the most of it. Not only will you benefit from tax relief, but your employer will also contribute. Alternatively, you could set up a private pension. While a private pension won’t reward you with employer contributions, you are eligible for tax relief.

While a life of frugality can sound incredibly dull, your time on board can be the perfect opportunity to spend as little as possible without making huge changes. Make the most of your wages by contributing to a monthly savings plan and remember how much money you’d likely be spending if you were back on land.

While some people within the FIRE community set arbitrary rules and deadlines, one of the worst things you can do is follow a one-size-fits-all approach to finance. Financially independent podcasters and bloggers might provide you with inspiration, but they cannot give you specialist and personalized advice that a financial adviser can.

This article originally ran in the December 2021 issue of Dockwalk.


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