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Early retirement: Is it right for you?

Waking up retired can seem like a dream, but it can turn into a nightmare if you haven’t prepared well. Common sense says you need to be financially ready to manage an early retirement. For fiscal help, you can turn to a financial adviser who can help you determine whether early retirement is practical for you. (Remember to find out how it will affect your pension amount and Social Security benefits, too.)

But deciding whether you’re ready emotionally for retirement isn’t as easy as seeking another’s advice. You’ll need to ask yourself a few important questions about how well you can adapt to a retirement lifestyle:

  • Will I become bored with my new routine? Once you’ve finished fixing everything around the house, what will you do? Will family and friends, many of whom will still be working, be available to you as much as you’d like? Is taking that European vacation realistic? Retirees who miss feeling part of something bigger than themselves or those who have too much time on their hands may wrestle with depression.
    Think about your personal goals and how you can realize them given your resources. Explore your interests. A new passion can provide tremendous fulfillment. Try taking a class—you’ll meet interesting people and examine new avenues for growth. Talking to other retirees ahead of time can give you good ideas. A team, a charity or a church group may be thrilled to have you on board. You may even be thinking about a second career, but be sure you’re realistic about whether your skills are really marketable and that you can compete with other job hunters who may have more experience than you do. Well before you retire, check the job market in the field you’d like to pursue so you don’t set yourself up for disappointment later.
  • How will my spouse handle my early retirement? If your husband or wife is working, consider whether he or she will still have to work when you retire. Will your spouse resent your staying home all day? Or will he or she expect you to take over all the housework? If you’re planning to travel once you’re retired, how will you feel if your spouse can’t leave work to accompany you?
    If you have a spouse, your roles and relationship will change. Consider whether an early retirement will cause undue stress and think about how you can continue to grow, both individually and as a couple.
  • Will I continue to make an effort to stay active and healthy once I’m not working? If you’re retiring early, you may live another 30 to 40 years. If you’ve been depending on an employer for health benefits, you may no longer be able to do so once you retire—a good reason to continue living a healthy lifestyle or to start one.
    Make sure you’ve saved enough money for medical insurance, routine healthcare expenses and medical emergencies until you’re eligible for Medicare at age 65. Be proactive about your health: Schedule a checkup and ask your doctor where you stand. Do you need to control your blood sugar or lower your blood pressure? Your doctor can recommend some health goals.
  • One last suggestion: Overestimate your life span. Retiring at 55 may mean you’re out of work for the next 40 years. Make sure you’re as healthy and financially comfortable as you can be and be prepared to enjoy the free time you worked so hard for.