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Some New Year’s resolutions are perennial, like getting in shape or improving your finances. While this may not be the year you run a 5K, it could be the year you make real progress toward a major money goal, like planning for an early retirement.
“Early retirement,” however, can feel too big — and too vague — to fit neatly into a single resolution. But when you break it down into smaller, more manageable goals, it becomes far more achievable.
If anyone understands how to do that, it’s Shang Saavedra, founder and CEO of Save My Cents, a nationally recognized personal finance expert who finished saving for retirement by age 31. Saavedra is also a published author and former Fortune 500 professional with nearly two decades of experience in personal finance and behavioral money coaching.
GOBankingRates spoke with Saavedra about the New Year’s money resolutions that can help put early retirement within reach — even if you feel behind.
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Saavedra points out that “early retirement” can feel like a catch-all phrase — it sounds great, but what does it really mean to you?
“I often ask people to think about what early retirement enables — moving to a less toxic career, enjoying more time with family, having more time to focus on personal health,” she said. “Having a clear vision helps you stay on goal more easily throughout the year.”
Rather than focusing solely on a specific retirement age or dollar amount, consider what you want your life to look like once work is optional. That might mean semi-retirement, flexible work or the freedom to change careers.
You might spend some time this new year sitting with friends, family, a financial advisor or even your journal to decide what early retirement means for your career, lifestyle, and physical, emotional and financial well-being.
Though much financial advice is tailored toward helping middle-class people, Saavedra invites you to reassess what it means to define yourself by a single social or economic class.
“Consider removing the classist narrative from your mind altogether,” she said. “Yes, you typically need to be wealthy to retire early, but if you continue seeing yourself as middle class, how is that going to help you move to more upper-class behaviors?”
Defining yourself by a single economic category can make it harder to imagine new possibilities. Instead of assuming early retirees were always wealthier or luckier, Saavedra encourages curiosity over comparison.
“Every time you see someone talk about how they achieved early retirement, don’t say, ‘Why can’t that be me?’” she said. “Ask, ‘What can I learn from that person’s success that I can apply to my own life?’”
January is peak tracking season. People log hours slept, steps walked, résumés sent and books read. Saavedra wants you to start tracking your expenses with that same level of attention.
“You have to really, really care about your numbers, just like people track their fitness, their sleep and their nutrition,” she said. “If you don’t track, you don’t have data, and without data, you can’t make informed decisions.”
When you track your spending, you gain clarity on where your money is going and where you can trim unnecessary costs. Living below your means is one of the most powerful tools for freeing up cash to invest, save or build passive income — all essential for early retirement.
This is also where working with the right professionals can pay off, particularly for freelancers and business owners.
“If you’re self-employed, get ahead of taxes — work with a great CPA and make sure you’re taking every qualified deduction available,” Saavedra said.
Saavedra managed to save enough for retirement at the shockingly young age of 31 — but she’ll be the first to tell you that this is not the norm.
“I don’t expect everyone to be able to reach early retirement,” she said. “But if you adopt the behaviors of people who retire early — being frugal, resourceful, tracking expenses and investing wisely — you can get very far financially.”
That progress may include paying down debt (or avoiding debt altogether), investing as much as you can, building side income or simply becoming more intentional with spending.
“You will grow in knowledge, and you will get better,” she said. “The important thing is to get started — the sooner, the better.”
You may not retire at 31, and you don’t need to. What matters is adopting money resolutions that better position you to retire earlier than you might expect. By clarifying your vision, reshaping your mindset, tracking your money and setting realistic expectations, you can make this year a meaningful step toward retiring earlier — or at least with far more choice and confidence.
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This article originally appeared on GOBankingRates.com: 4 New-Year Money Resolutions To Help You Retire Early — From an Expert Who Actually Did It