When you’ve spent the majority of your adult life working, you may be eager to retire as soon as possible. Maybe you have a long bucket list of activities you can’t wait to enjoy, or perhaps you’re just ready to sit back and enjoy a life of leisure.
Regardless of how you choose to spend your later years, early retirement can be an excellent decision. However, it can also be a terrible choice if you’re not financially or mentally ready to retire just yet. So before you call it quits at your job, take an honest look at your situation and weigh the pros and cons of early retirement.
Pro no. 1: You can enjoy more time living the life you want when you’re young and healthy
One of the biggest advantages of early retirement is that you don’t need to wait to start enjoying the life you want to live — particularly if you want an active retirement lifestyle. If you’ve always dreamed of learning to skydive or backpacking across Europe, there’s no guarantee you’ll still be able to achieve those goals if you wait until your 60s or 70s to retire. In that case, retiring early can help you live life to the fullest before health issues get in the way.
In addition, retiring early may even help you live longer. Research published in the Journal of Health and Economics found that early retirement often decreased the chances that a worker would die in the next five years compared to workers who retired at the traditional retirement age. That could be because of the decrease in stress once a worker left his or her job, or it might be related to the fact that retirees have more time to sleep, exercise, and take care of themselves. Either way, early retirement could potentially have a positive effect on your health, giving you more time to enjoy the things you love.
Pro no. 2: Delaying retirement might be a risky decision
Some people hold off on retirement because they want to give themselves as much time as possible to prepare. While that’s a laudable decision and can be the right move for some people, it can also be risky.
You never know what the future holds, and the last thing you want is to work yourself to the bone for decades only to develop health issues just a year or two into retirement. The average life expectancy in the U.S. is 78.6 years old, according to the Centers for Disease Control and Prevention. If you wait until your late 60s or early 70s to retire, you may not have much time to enjoy your senior years.
While working hard to save more is smart, don’t forget about your ultimate goal — to enjoy a comfortable retirement. All the savings in the world won’t buy you more time, so use that time wisely.
Pro no. 3: You don’t want to reach the end of your life with regrets
It’s true what they say: Nobody ever reaches the end of life and wishes they’d spent more time working and less time enjoying the things they love.
Everyone has regrets, but retirement regrets can be some of the most painful. When you’re on your deathbed, you’ll want to be thinking about all the good memories and experiences you’ve had over a lifetime — not all the extra hours you sat in the office neglecting your own happiness.
Of course, you still need to work hard enough to adequately prepare for retirement. If you retire early with little to nothing saved, that could lead to plenty of regrets as well when you can’t afford to enjoy your senior years. But by retiring when you’re ready and not forcing yourself to work longer than you should, you can enjoy your life as much as possible and create lasting memories.
Con no. 1: Early retirement is more expensive
While there are plenty of advantages to retiring as early as possible, the truth is that early retirement is no cakewalk. It requires more preparation than retiring at a later age, and it can also be much more expensive.
When you retire early, you’ll be spending more years in retirement, but you also have less time to save. Those two challenges mean you’ll have to supercharge your savings from a young age, potentially making significant sacrifices to build a robust nest egg. Whether those sacrifices are worth it will be up to you to decide, but some people may choose to live more comfortably while they’re working and delay retirement by a few years.
Con no. 2: You’ll need a plan to keep yourself busy
Retirement is longer than you may realize, especially if you end up retiring early. If you live a longer-than-average lifespan, there’s a chance you could spend more time in retirement than you did working. That’s a lot of free time, and if you don’t have a plan for how you’re going to spend all that time, you may end up bored and miserable.
It’s especially important to come up with a list of activities you can enjoy on a budget. It’s easy to find fun things to do, but many of those things involve spending a significant amount of money. If your savings are beginning to run dry late into retirement, you may not be able to afford to take vacations every few months or go out to dinner every night with friends. So unless you have an exceptionally healthy nest egg, you’ll need plenty of inexpensive hobbies to keep you busy throughout an extra-long retirement.
Early retirement can be a blessing or a curse, and it’s not necessarily the right choice for everyone. But if it’s the right decision for you, it could make your senior years some of the best years of your life.
