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Forget the EuroMillions and National Lottery! This could be an easier way to retire early

Winning fortunes on the National Lottery or EuroMillions would mean an early retirement for most people. However, the chances of winning either are extremely slim. Therefore, the vast majority will require another plan in order to reduce their reliance on the State Pension in older age.

Fortunately, the stock market has become increasingly accessible for a range of investors over recent years. It’s now easier than ever to build a retirement portfolio from mid- and large-cap shares which could improve your long-term financial future.

Regular investing

Anyone wishing to start investing with modest amounts of capital could benefit from regular investing in tracker funds. Regular investing in a service offered by many (if not most) sharedealing providers where customer orders in a specific stock or fund are aggregated and executed together.

This leads to less control over the exact time at which a trade is undertaken, but the benefit is that a purchase of shares can cost as little as £1.50 per trade.

This could make the service appealing to smaller investors, for whom the standard cost of sharedealing may prove to be prohibitively expensive. In addition, regular investing doesn’t require someone to time the market.

This may allow them to capitalise on bear markets, since they’ll purchase shares throughout the stock market cycle, and benefit from the upward trajectory of the market.

Tracker funds

Investing regularly in a tracker fund could be a simple means for a small investor to obtain a favourable risk/reward ratio from the outset of their journey. Building a portfolio of individual stocks can require significant sums of capital that may be immediately unavailable. And having a small number of shares may not be a good idea, since it can lead to a high degree of risk.

As such, buying a tracker fund provides diversity, as well as exposure to the return prospects of an index, such as the FTSE 100. In the long run, this could lead to a high-single digit annualised return that significantly improves your retirement prospects.

Outperforming the market

Of course, for investors who have accumulated sufficient capital to own a variety of companies within their portfolio, there appears to be a number of stocks available at present that could deliver market-beating returns.

Among them are companies that operate in emerging markets, where rising wages could produce a tailwind. Likewise, UK-focused companies are unloved at the present time due to relatively high political and economic risks. This may mean they offer wide margins of safety that produce higher returns in the long run.

As such, using the uncertainty that’s present in the stock market to your advantage could be a shrewd move. Through buying and holding shares over the long run, you could build a surprisingly large retirement nest egg that helps you to retire early.

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Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.