All this early retirement stuff is great when it’s you by yourself or even if you have a partner.
When it’s just the two of you, you could easily live off of one salary and invest the other one.
However, when kids are involved, things begin to get tricky – after all, kids can be expensive.
So the question is: can you really retire early if you have children, or is this just for couples?
The answer is yes – you can indeed retire early if you have kids, as a lot of people have done.
Ideally, you want to try and retire early before you have kids, but this is not always possible.
Doing so allows you to save on childcare costs in their early years as you don’t need to work.
However, retiring while you have kids may be better as you know what your expenses are.
In this post, I talk about retiring early with children at the different stages of their education.
I also talk about how some stages are easier to retire early in because they are less expensive.
Finally, I talk about how you can retire early with kids and where to find out more information.
Early Retirement before having Children
This is the ideal case when it comes to early retirement, especially if you plan to have children.
This is what Pete Adeney (MrMoneyMustache) did – retired at 31 before the birth of his son.
As you can imagine, there are many benefits to doing so:
- By retiring early before you have children, you get to travel as much as you want beforehand.
- Because you don’t need to work, you can save on childcare as you can take of them yourself.
- Because you no longer go to work, you can travel with them until they need to start school!
However, if you plan to retire early before kids, you need to take their expenses into account.
Before it was just you (and your partner) and you know how much you need to live each year.
When a kid comes along, you’ve no idea how much money you need on top of your expenses.
That’s why if you plan to have children in early retirement, you need to have considered this.
Early Retirement with Pre-School Children
You may be reading and thinking – that’s great, but I already have kids, can I still retire early?
The answer to this question depends on one thing – what stage of their lives they are in now.
If your children are in their early years before school (0-5 years), this is where things get tricky.
Prior to children, you may have been used to living off of one salary and investing the other.
However, once you have your first child, you will quickly realise that this will no longer work!
In the UK, the average cost of full time childcare is around £263.81/week or £1143.18/month.
That’s for one child; if you have two children, then that doubles to around £2,286.35/month.
That’s the equivalent of one of your full time salaries, not including all their other expenses.
So the bad news is, it’s unlikely you’ll be able to retire early if you have to pay for childcare.
If you can save costs by leaving your kids with parents, you may still be able to retire early.
Early Retirement with School Age Children
If your kids are passed this stage and are now in school, don’t worry, you can still retire early.
In fact, this is now the best time to try and retire early before your children go to university.
- In the UK education system, schools are either funded by government and are therefore free.
- Or, they are private schools, not government funded and therefore charge you fees to attend.
I’m sure that it’s no surprise when I say that if you plan to retire early – stick to public schools.
This is entirely up to you and your goals, you may want to send your kids to the best schools.
However, if you want any chance of retiring early then this is the best phase before university.
By sticking to public school, you can save money, live off of one salary, and invest the other.
By doing so for the 13 years or so they are in school, your portfolio will compound over time.
Over these years, your portfolio may reach your goal which would allow you to retire early.
Early Retirement with University Age Children
If you’ve not retired early by the time your children go to university, you can still retire early.
Similar to their early pre-school years, the cost of sending your children to university is high.
In the UK university tuition fees are £9,250 for an undergraduate degree; masters costs more.
This doesn’t include living, food, and travel costs if the student is planning away from home.
Therefore, if your goal is to retire early, then don’t send them to university away from home!
Parents can’t avoid tuition fees (unless they don’t go to uni) but they can avoid the other fees.
Of course it’s not as simple as that, but I am only speaking from a financial point of view.
The good news is that your children could start working part time to help with their expenses.
They would easily make £10,000 a year to cover their tuition – don’t take out student loans!
Assuming they also live at home, you certainly continue building your portfolio to retire early.
You can Retire Early with Children
Let’s not fool ourselves – retiring early is harder when you have children, but not impossible.
- Ideally, you want to retire early before having kids to free your time to absorb childcare costs.
- If you haven’t retired early by then, then you can aim to retire early before they go to school.
- If you haven’t retired early by then, you can aim to retire early before they get to university.
Whatever stage they’re at, please don’t think that you can either retire early or have children.
By knowing what to expect financially in terms of having kids, you can have both if you want!
To find out more on retiring early with children, check out the book: Quit like a Millionaire.
The authors discuss the real costs of children, and how you can school them while travelling.
Are you on the path to early retirement? How is it going? Please share in the comments below.
If you have any future blog article suggestions, please let me know in the comments below!
