How to retire five years earlier
How to retire five years earlier
Here’s a little thought experiment that might mean you can retire five years earlier: drive a Korean car instead of a German one.
July 20, 2016

By Ross Martin, Accountancy Director at Hive Business

Here’s a little thought experiment that might mean you can retire five years earlier: drive a Korean car instead of a German one.

You pay £400 a month for that hire purchase BMW 5 Series / Mercedes E Class / Audi A4 and renew it every three years — but how about going for a £200 alternative?

I know, it doesn’t sound quite as fun does it? But if you take your £200 a month saving and invest it somewhere with a return of five per cent for the next 25 years, you generate well over £100k.

It’s easy to get sucked into the rat race, and I know we’re all guilty of it to some degree, but think carefully about your car and any other things you plough significant sums into without expecting any return. Just because your neighbour has an Audi, does that really mean you can’t live without one?

As things stand the money is already gone from your cash flow anyway, so a change like this could actually be, psychologically speaking at least, a very easy sacrifice to make. If the £400 a month is already gone, why not get something back for it? How would a spare £100k change your life in 25 years?

It’s a well known trope that wealthier people have ended up being wealthier because they plough most of their profits into real wealth — assets that build passive income, whereas the less well off spend most of their profits on wealth sinking commodities like holidays and cars.

My only point is that the choices you make have long term financial consequences, even if they are consequences you maybe hadn’t calculated. It might seem out of the question to downgrade your car, until you realise its true wealth eroding nature.

There are signs that dentists as a group are failing to calculate the long term financial consequences of their decisions until it’s too late to substantively change them. Research published by financial consultants Wesleyan last week showed three quarters of dentists don’t know how much they should be saving for retirement each month and one in eight have no intention of finding out.

The survey of 100 dentists also revealed that the amount dentists think they’ll need each year in retirement has fallen by nearly £10,000 since 2014 — can that really be an accurate picture of reality or is it wishful thinking?

If you’d like to review your long term financial position do get in touch — small changes now can make a really big difference. Call us on 01872 300232 or email us at

The information contained in this article is based on the opinion of Hive Business and does not constitute formal tax advice. Any tax outcomes will be based on individual circumstances, tax legislation and regulation, which are subject to change in the future. You should seek specific advice before embarking on any course of action. Hive Business does not provide regulated Financial Advice, including advice on investment, insurance or lending products or their suitability for you. This article is provided for information only and does not constitute, and should not be interpreted as, investment advice or a recommendation to buy, sell or otherwise transact, or not transact, in any investment including Bitcoin and other crypto. Any use you wish to make of any information contained within this article is, therefore, entirely at your own risk.

By Ross Martin Group Chairman
If you have any questions or comments about this article, please get in touch.
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