When Can I Retire Comfortably?

For years I wondered When Can I Retire? It became almost an obsession and I dreamed about it in my spare time.

The thing that always scared me was hearing all those formulas about saving millions and replacing 80% of my pre-retirement income. I was afraid to retire until I sat down and did some math exercises.

Health care cost was also a big concern because I wanted to retire long before I would be eligible for Medicare.

Now that we finally have affordable health care more people can address health care in early retirement.

I spent a full year testing the idea and half of that time testing a budget.

Anyway, the stars aligned and we finally retired shortly after I turned 55.

So When Can You Retire?

Is it when you have enough money?

Or is it when you're old enough to access your savings without penalties?

Or is it when you reach full retirement age and have access to Social Security benefits?

When Can I Retire, Age-wise?

If your savings won't provide the income you need, you'll have to wait for Social Security (or equivalent). See the section on Social Security for more on "When Can I Retire with Social Security".

Keep in mind that regardless of whether you reach age 62 or higher, you also need to have worked a sufficient number of years and paid into the system for those years. Go to ssa.gov and find out where you stand or contact your local SSA office.

Besides just knowing when you can get your Social Security benefits, you should find out whether you can actually live on it. To figure out what you'll need in your budget see the section on Financial Planning.

To retire and access your "regulated" retirement accounts, you need to wait for age 55 or 59 1/2 to avoid paying early withdrawal fees. See the section on 401k and IRA for the specifics on these.

Of course if you have regular savings to live on, you can retire whenever you want. Only tax-advantaged retirement savings and Social Security have age restrictions for when you can retire.

When Can I Retire Money-wise?

To decide whether you have the means to retire you have to know how much your desired lifestyle will cost in the long run. So you need to know what your basic living expenses will be, but also what you will do in your free time. Some of those things might cost money, so you need to have an idea what they will be to budget for them.

Things that make retiring easier include having your home paid off, being able to afford health insurance and long term care insurance, and knowing how you will spend your time.

Most of the people I know who are not obsessed with retiring are happiest at work. They don't have a lot of interest in traveling or in hobbies outside of their jobs.

If you don't have strong interests outside of your job, you could find yourself just watching TV all the time. But you might get lonely or let your health deteriorate.

On the other hand, those people who want to leave their jobs usually find hobbies or interests that actually look like work to the rest of the world.

Some may start a business, others, like me, might work on a website, or do gardening work. One person's work is another person's hobby... You get the idea.


Obviously you need to have some kind of income. You could wait for Social Security or you could save enough money to cover the years before you're eligible.

You might also want some savings to cover emergencies like health problems in your later years that won't be covered by Medicare.

This is usually a situation where you'll be in a skilled nursing facility for an extended period.

Insurance for long term care can help prevent a long illness from wiping out all your assets, so that definitely needs to be in your budget.

Am I making the case for spending some time on an actual plan for this next phase of your life? I hope so.