How To Retire Early On A Low Income

Adam Del Duca
9 min readMar 10, 2022
Photo by Emilio Takas on Unsplash

I don’t care how much you love your job, there’s going to come a day where you wake up in the morning with your back aching, your knees cracking and your body telling you that you’re done working. Unfortunately, this day will come for us all, however the question is, will we have the money to lay down our work tools and start the next chapter of our life? For those earning lower-incomes, the idea of retiring early is probably a pipedream however it shouldn’t be because with the right strategy anyone can achieve this financial event and here’s how!

Debt Management

The first step that is absolutely critical to your ability to retire early on a low income is to remove all harmful debt from your financial life. Notice how I said “harmful debt”? This is because there are forms of debt that can be extremely useful in your quest to require early. Examples include acquiring a mortgage that finances a rental property or a business loan that helps get your operations off the ground.

When I talk about harmful debt, you probably already have a good idea of what I mean but I will explicitly say it anyways: high-interest debt. I’m talking about auto loans, credit card debt and the criminally destructive payday loan debts. I want to make something clear right now, if you can’t remove these forms of debt from your life, especially as a low-income earner, you have absolutely no chance at retiring early. Why is that? Because high-interest debts are wealth destroyers. Here’s an example to illustrate what I mean.

Let’s say you had a credit card balance of $6,000 at 18% and only paid the minimum $200 payment every month, it would take you 41 months or almost 3.5 years to pay it off. Not to mention besides repaying the initial $6,000, you’d also end up handing over $2,000 in interest payments as well! Let me ask you this, ask a low-income earner, do you really have $2,000 extra dollars to just be handing over to your creditor for fun? I don’t think so and this is why avoiding this kind of debt is key to making the necessary strides in your finances that will allow you to actually retire early.

Now, it’s all good and well for me to tell you not to play around with these costly forms of debt but what if you’re already neck deep in debt? Well, then you have some work to do and…