Early Retirement Options (UK)
It's highly unlikely that you will be able to achieve 8% and would consider myself lucky to get 4% in the current interest rate environment.  You might want to read some reviews of peer-to-peer lending and even try it out some yourself.  Give yourself something like 2000 Euros/Dollars and a year.  If you truly need 8% to retire, then you are not ready to retire. Here in the US it increases the complexity of your tax forms.  I did an experiment with lending club.   Here is what I found: After 18 months of giving it a try, I decided to abandon this strategy.  My money will receive better and safer returns in a dividend focused mutual fund. However, I encourage you to give it a try yourself. Some people put money into Venture Capital Trusts for the yields they offer. The risks are different and they are considered higher risk than ordinary equities; you need to be a sophisticated investor or high net worth individual to consider them. https://www.wealthclub.co.uk/articles/investment-news/why-i-never-sold-vct/ I'm not recommending these for you, just pointing it out as another option as per the question.
"Your retirement plan shouldn't necessarily be dictated by your perceived employment risks. If you're feeling insecure about your short-term job longevity and mid-career prospects, you will likely benefit from a thoughtful and robust emergency fund plan. Your retirement plan is really designed to fund your life after work, so the usual advice to contribute as much as you can as early as you can applies either way. While a well-funded retirement portfolio will help you feel generally more secure in the long run (and worst case can be used earlier), a good emergency fund will do more to address your near-term concerns. Both retirement and emergency fund planning are fundamental to a comprehensive personal finance plan. This post on StackExchange has some basic info about your retirement options. Given your spare income, you should be able to fully fund an IRA and your 401K every year with some left over. Check the fees in your 401K to determine if you really want to fully fund the 401K past employer matching. There are several good answers and info about that here. Low-cost mutual funds are a good choice for starting your IRA. There is a lot of different advice about emergency funds (check here) ranging from x months salary in savings to detailed planning for each of your expenses. Regardless of which method you chose, it is important to think about your personal risk tolerance and create a plan that addresses your personal needs. It's difficult to live life and perform well at work if you're always worried about your situation. A good emergency plan should go a long way toward calming those fears. Your concern about reaching mid-life and becoming obsolete or unable to keep up in your career may be premature. Of course your mind, body, and your abilities will change over the years, but it is very difficult to predict where you will be, what you will be doing, and whether your experience will offset any potential decrease in your ability to keep up. It's good to think ahead and consider the ""what-ifs"", but keep in mind that those scenarios are not preordained. There isn't anything special about being 40 that will force you into a different line of work if you don't want to switch." Yes, and there's a good reason they might. (I'm gonna use equity options for the example; FX options are my thing, but they typically trade European style). The catch is dividends.  Imagine you're long a deep-ITM call on a stock that's about to pay a dividend. If that dividend is larger than the time value remaining on the option, you'd prefer to exercise early - giving you the stock and the dividend payment - rather than hanging on to the time value of the option.  You can get a similar situation in FX options when you're long a deep-ITM American call on a positive-carry currency (say AUDJPY); you might find yourself so deep in the money, with so little time value left on the option, that you'd rather exercise the option and give up the remaining time value in return for the additional carry from getting the spot position early. I have managed two IRA accounts; one I inherited from my wife's 401K and my own's 457B.  I managed actively my wife's 401 at Tradestation which doesn't restrict on Options except level 5 as naked puts and calls. I moved half of my 457B funds to TDAmeritrade, the only broker authorized by my employer, to open a Self Directed account.  However, my 457 plan disallows me from using a Cash-secured Puts, only Covered Calls.  For those who does not know investing, I resent the contention that participants to these IRAs should not be messing around with their IRA funds.  For years, I left my 401k/457B funds with my current fund custodian, Great West Financial.  I checked it's current values once or twice a year. These last years, the market dived in the last 2 quarters of 2015 and another dive early January and February of 2016.  I lost a total of $40K leaving my portfolio with my current custodian choosing all 30 products they offer, 90% of them are ETFs and the rest are bonds. If you don't know investing, better leave it with the pros - right?  But no one can predict the future of the market.  Even the pros are at the mercy of the market. So, I you know how to invest and choose your stocks, I don't think your plan administrator has to limit you on how you manage your funds. For example, if you are not allowed to place a Cash-Secured Puts and you just Buy the stocks or EFT at market or even limit order, you buy the securities at their market value. If you sell a Cash-secured puts against the stocks/ETF you are interested in buying, you will receive a credit in fraction of a dollar in a specific time frame.  In average, your cost to owning a stock/ETF is lesser if you buy it at market or even a limit order.  Most of the participants of the IRA funds rely too much on their portfolio manager because they don't know how to manage. If you try to educate yourself at a minimum, you will have a good understanding of how your IRA funds are tied up to the market.  If you know how to trade in bear market compared to bull market, then you are good at managing your investments.  When I started contributing to my employer's deferred comp account (457B) as a public employee, I have no idea of how my portfolio works.  Year after year as I looked at my investment, I was happy because it continued to grow.  Without scrutinizing how much it grew yearly, and my regular payroll contribution, I am happy even it only grew 2% per year.  And at this age that I am ready to retire at 60, I started taking investment classes and attended pre-retirement seminars.  Then I knew that it was not totally a good decision to leave your retirement funds in the hands of the portfolio manager since they don't really care if it tanked out on some years as long at overall it grew to a meager 1%-4% because they managers are pretty conservative on picking the equities they invest.  You can generalize that maybe 90% of IRA investors don't know about investing and have poor decision making actions which securities/ETF to buy and hold. For those who would like to remain as one, that is fine.  But for those who spent time and money to study and know how to invest, I don't think the plan manager can limit the participants ability to manage their own portfolio especially if the funds have no matching from the employer like mine. All I can say to all who have IRA or any retirement accounts, educate yourself early because if you leave it all to your portfolio managers, you lost a lot.  Don't believe much in what those commercial fund managers also show in their presentation just to move your funds for them to manage.  Be proactive.  If you start learning how to invest now when you are young, JUST DO IT! "Probably not. In general, if you withdraw money from a 401k before age 59 1/2, you must pay a 10% penalty. There are some special cases. You can withdraw money to pay certain unreimbursed medical bills, if you are disabled, or to pay back taxes. You can also withdraw money if you are dead. See https://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-Tax-on-Early-Distributions. There is also a provision that you can make penalty-free withdrawals as long as you take them regularly: ""Made as part of a series of substantially equal periodic payments beginning after separation from service and made at least annually for the life or life expectancy of the participant or the joint lives or life expectancies of the participant and his or her designated beneficiary. (The payments under this exception, except in the case of death or disability, must continue for at least 5 years or until the employee reaches age 59½, whichever is the longer period.)"" See https://www.irs.gov/Retirement-Plans/Plan-Sponsor/401(k)-Resource-Guide-Plan-Sponsors-General-Distribution-Rules. (I don't quite understand this rule. You can't take money out one time, but you can take money out multiple times. Oh well. I think the idea is supposed to be that you can take out money for an early retirement.)" Normal high street accounts certainly are available to non-residents. I have several, and I haven't been resident in the UK for fourteen years. However you do need to open them before you leave. They need identification. Once you have one open, the same bank should be able to open other accounts by mail. The disadvantage of course is that you will pay tax on your earnings, and while you can claim it back that's an unnecessary piece of work if you don't have other UK earnings. I would take the risk of an offshore account, assuming it's with a big reputable bank - the kind that are going to be bailed out if there is another collapse. An alternative might be a fixed term deposit. You lock up your money for three years, and you get it back plus a single interest payment at the end of three years. You would pay nothing in tax while you were gone, but the whole interest amount would be taxable when you got back. Some highly pessimistic things worth noting to go alongside all the stability and tax break upside that homes generally provide: Negative equity is no joke and basically the only thing that bankrupts the middle classes consistently en masse. The UK is at the end of a huge housing bull run where rents are extremely cheap relative to buying (often in the 1% range within the M25), Brexit is looming and interest rates could well sky rocket with inflation. Borrowing ~500k to buy a highly illiquid asset you might have to fire sale in case of emergency/job loss etc for 300k in a few years when lots of (relatively) cheap rental housing is available to rent risk free, could be argued to be a highly lopsided and dangerous bet vs the alternatives. Locking in 'preferential' mortgage rates can be a huge trap: low interest rates generally increase asset values. If/when they rise, assets fall in value as the demand shrinks, making you highly exposed to huge losses if you need to sell before it is paid off. In the case of housing this can be exceptionally vicious as the liquidity dramatically dries up during falls, meaning fire sales become much more severe than they are for more liquid assets like stock.  Weirdly and unlike most products, people tend to buy the very best house they can get leverage for, rather than work out what they need/want and finding the best value equivalent. If a bank will lend you £20 a day to buy lunch, and you can just afford to pay it, do you hunt out the very best £20 lunch you can every day, or do you make some solid compromises so you can save money for other things etc? You seem to be hunting very close to the absolute peak amount you can spend on these numbers. Related to above, at that level of mortgage/salary you have very little margin for error if either of you lose jobs etc.  Houses are much more expensive to maintain/trade than most people think. You spend ~2-5% every time you buy and sell, and you can easily spend 2-20k+ a year depending what happens just keeping the thing watertight, paid for, liveable and staying up. You need to factor this in and be pessimistic when you do.  Most people don't factor in these costs to the apparent 'index' rise in house values and what they expect to sell for in x years. In reality no buy and hold investor can ever realise even close to the quoted house price returns as they are basically stocks you have to pay 5% each time you buy or sell and then 1-20% percent a year to own - they have to rise dramatically over time for you to even break even after all the costs.  In general you should buy homes to make memories, not money, and to buy them at prices that don't cause you sleepless nights in case of disasters. I have done something similar to this myself.  What you are suggesting is a sound theory and it works.  The issues are (which is why it's the reason not everyone does it) : The initial cost is great, many people in their 20s or 30s cannot afford their own home, let alone buy second properties.  The time to build up a portfolio is very long term and is best for a pension investment.  it's often not best for diversification - you've heard not putting all your eggs in one basket? With property deposits, you need to put a lot of eggs in to make it work and this can leave you vulnerable. there can be lots of work involved. Renovating is a huge pain and cost and you've already mentioned tennants not paying!  unlike a bank account or bonds/shares etc.  You cannot get to your savings/investments quickly if you need to (or find an opportunity)  But after considering these and deciding the plunge is worth it, I would say go for it, be a good landlord, with good quality property and you'll have a great nest egg.  If you try just one and see how it goes, with population increase, in a safe (respectable) location, the value of the investment should continue to rise (which it doesn't in a bank) and you can expect a 5%+ rental return (very hard to find in cash account!)  Hope it goes well! Look through the related questions.  Make sure you fund the max your tax advantaged retirement funds will take this year.  Use the 30k to backstop any shortfalls.  Invest the rest in a brokerage account. In and out of your tax advantaged accounts, try to invest in index funds.  Your feeling that paying someone to manage your investments might not be the best use is shared by many.  jlcollinsnh is a financial independence blogger.  He, and many others, recommend the Vanguard Total Stock Market Index Admiral Shares.  I have not heard of a lower expense ratio (0.05%). Search for financial independence and FIRE (Financial Independence Retire Early).  Use your windfall to set yourself on that road, and you will be less likely to sit where I am 25 years from now wishing you had done things differently. Edit:  Your attitude should be that the earliest money in your portfolio is in there the longest, and earns the most.  Starting with a big windfall puts you years ahead of where you'd normally be.  If you set your goal to retire at 40, that money will be worth significantly more in 20 years. (4x what you start with, assuming 7% average yearly return).