Weighing the Ups and Downs of Early Retirement

man in an office packing up his belongings

You’ve always been a go-getter. 

 

From your early days in the corporate world, climbing up the ladder, to your 40s, where you were the one everyone looked up to for advice. You’ve lived the hustle, tasted success, and now, as you look towards the sunset years, you’re contemplating an early retirement.

 

Picture it — mornings free from alarm clocks, afternoons spent exploring hobbies you never had time for, and evenings with loved ones, unburdened by work stress. 

 

Sounds idyllic, doesn’t it? 

 

The allure of early retirement is strong, and why wouldn’t it be? After all, you’ve earned it.

 

But hold on just a minute — before you turn in your notice and break out the golf clubs, let’s talk about the pros and cons of early retirement to help you avoid making costly mistakes.

 

With a little bit of foresight and planning, you might just find the perfect balance between work and leisure in your golden years.

 

So let’s dive into retiring early…

 

What is Early Retirement?

Early retirement refers to the concept of quitting work earlier than the traditional retirement age of 65. It may mean leaving the workforce at 50 or it could be as early as 30 or 40. 

 

The idea of early retirement often comes with a sense of freedom and the ability to enjoy life outside of the 9-to-5 grind. It’s a concept that has gained popularity in recent years due to the rise of the FIRE (Financial Independence, Retire Early) movement. 

 

According to the EBRI 2017 survey, the reasons for early retirement vary. 

 

For some, it’s a way to break free from the daily grind and pursue something else (10%) or simply just because they can afford it (24%). Others may choose early retirement due to health concerns or disabilities (41%) or changes like downsizing at their company (10%).

 

Reasons for early retirement: health problems or disability, downsizing or closure, able to afford it, having to take care for a family memebr, wanting to do something else
Are your reasons for retiring early on this list?

 

Whatever the reason, early retirement isn’t just about lounging on the beach; it requires discipline and careful planning (beyond just finances) to achieve your desired lifestyle. 

 

Pros & Cons of Early Retirement

5 Pros of Early Retirement

5 pros of early retirement: freedom and flexibility, quality time, personal growth, lower stress levels, chance to pursue a new career

#1 Freedom & Flexibility 

Early retirement is often seen as a double-edged sword, but one of the undeniable benefits is the freedom and flexibility it introduces to your life. 

 

After decades of structured work schedules, deadlines, and commitments, early retirement presents an opportunity to reclaim your time and live life on your own terms.

 

This newfound time can be dedicated to anything that brings joy or fulfillment. Retirees often find themselves with ample time to pursue leisure activities they previously didn’t have time for. 

 

Travel, reading, socializing, or even starting a new hobby or business venture are all within reach in early retirement. A study by the Bureau of Labor Statistics found that retirees allocate a significant portion of their time to such leisure activities.

 

But it’s worth noting that this luxury of time should be used wisely. The same study also found that a considerable amount of retirees’ free time is spent watching TV, which isn’t really the most fulfilling or productive use of time.

 

the impact of watching too much TV on older adults
How much TV are you watching? Being aware is the first step to cutting down on your tube time.

 

In essence, early retirement offers the chance to take control of your schedule and enjoy life’s pleasures to the fullest. It provides an opportunity to shift from a life built around work to one centered around personal growth, enjoyment, and relaxation.

 

But like any major lifestyle change, it requires careful planning and thoughtful decision-making to make the most out of this newfound freedom and flexibility.

 

#2 Quality Time

For many people, more time with loved ones ranks high on their wish list, but finding the time to actually make that happen can be a challenge. 

 

That’s where early retirement is beneficial — it provides the perfect opportunity to spend quality time with family and friends, strengthening bonds and creating lasting memories. 

 

In fact, according to research, marital satisfaction turned out to be the strongest predictor of retirement timing. So, the happier you are in your marriage, the more likely you are to take advantage of this chance and spend more time with your loved ones. 

 

factors that influence the decision to retire early
Apart from traditional economic factors, marital satisfaction has the greatest impact on the decision to retire early.

 

With the freedom and flexibility that early retirement offers, you can finally make cherished moments with your nearest and dearest a top priority.

 

#3 Personal Growth

One of the great perks of early retirement is having more time on your hands – and with that time, comes the opportunity to focus on personal development. 

 

Whether you’ve always wanted to learn a new language, dive into a lifelong passion, or even pursue an advanced degree, retirement can be the perfect life phase to do it. 

 

The beauty of not being bound by a strict schedule or demanding job is that you’re free to explore, learn, and grow at your own pace. You can enrich your knowledge, broaden your skillset, and embark on a journey of self-discovery and exploration. 

 

And it’s not just for personal fulfillment — studies show that adults who consistently challenge themselves with multiple new skills can maintain cognitive abilities similar to those of people half their age. 

 

Essentially, you have the power to redefine your retirement period into a phase of personal growth, lifelong learning, and enrichment.

 

And we’ve got just the thing to help you — our Finding Clarity workbook is designed to guide you in identifying your goals, passions, and areas for growth, serving as your roadmap to a fulfilling and growth-oriented retirement.

 

finding clarity in retirement workbook cover
Ready to find some much needed clarity?

 

With the extra time retirement provides, personal development can become a fulfilling and exciting adventure.

 

#4 Lower Stress Levels

Retirement is often associated with relaxation, but what if you could start enjoying those stress-reducing benefits earlier in life? 

 

The relentless pace of work life can exert a heavy toll on our mental and physical health, leading to feelings of stress and burnout — especially if you’re a blue-collar worker

 

And by choosing to retire early, you can substantially alleviate the stress associated with job performance and deadlines, promoting a more relaxed and healthier lifestyle.

 

In early retirement, there’s no more scrambling to meet project deadlines, fretting over that big presentation, or enduring conflicts with managers. Instead, it ushers in a new realm of possibilities for leading a fulfilling life. 

 

#5 Chance to Pursue a New Career

Retiring early to begin a new career can seem like an unconventional move. But for those looking to pursue their passions, it can be a game-changing decision. 

 

Interestingly, about a third of retirees have engaged in paid work post-retirement and a whopping 90% chose to do so to maintain an active and engaged lifestyle.

 

The beauty of retiring early is that money isn’t the main motivator. Instead, you have the freedom to explore different opportunities that align with your deeper values and interests. And working again after retirement can bring about a host of benefits.

 

the benefits of working after retirement are financial security, improved health, sense of purpose

 

Maybe you’ve always wanted to start your own business but felt like you couldn’t take the risk while working a full-time job. Or maybe you want to work for an organization that makes a more positive impact on the world. 

 

Whatever your dreams may be, retiring early may open the chance to finally chase them. 

 

5 Cons of Early Retirement

cons of early retirement: financial stress, loss of identity, social isolation, boredom, lack of mental stimulation

#1 Financial Stress

Even with a substantial nest egg, the fear of outliving your savings is real. Increased life expectancy means your retirement funds need to last longer, and unexpected expenses can always crop up. 

 

Inflation is one such factor that can significantly impact the value of your savings over time. As the cost of goods and services increases, the purchasing power of your savings diminishes. 

 

For instance, according to this handy inflation calculator, if you could buy something for $100 in January 2021, you’d need nearly $120 for the same items by August 2023. Therefore, it’s crucial to factor in inflation when planning for retirement to ensure your savings maintain their value over time.

 

Healthcare costs are also a significant consideration. As you age, healthcare needs often increase, leading to higher medical expenses. 

 

For instance, a 65-year-old retired couple will need an estimated $315,000 in 2022 for healthcare costs throughout retirement. And if you add chronic illness into the mix, the costs shoot up even higher.

 

65-year old retired couple will need an estimated of $315,000 in 2022 to cover health care costs in retirement

 

And not to mention – retiring before you turn 59.5 can come with a hefty price tag. That’s because many tax-deferred accounts, such as traditional IRAs and 401(k) plans, impose a 10% early withdrawal penalty on funds taken out before that age. 

 

This can dramatically reduce the amount of money you have to live on in retirement, so it’s important to think carefully about your options.

 

Sounds challenging? 

 

Sure, but what you need before retiring early is a comprehensive plan and retirement budget that factors in these potential risks. A plan that ensures you have a steady income stream throughout your retirement years, even if they turn out to be longer than usual.

 

#2 Loss of Identity

So many of us have our self-worth and identities intricately woven into our careers. It’s not just about the paycheck, it’s about the sense of purpose, the daily structure, and the social interactions that come with it. 

 

When you decide to retire early, it can feel like you’re losing a part of yourself — even if it’s something you truly wanted and planned for. It’s a significant life transition that requires you to redefine who you are outside of your profession.

 

Just think about it, how many times have you introduced or described yourself with your profession? 

 

But it turns out that retirement doesn’t erase your professional identity. In fact, it remains a significant part of how you see yourself, according to a study on personal identity after retirement.

 

Interestingly, the study also found that retirement doesn’t limit self-description — quite the opposite. Retirees rate more domains as important for self-description than the non-retirees.

 

This suggests that with retirement comes a greater diversity in identity. You’re not just “retired.” You’re an artist, gardener, volunteer, grandparent, and so much more.

self-identity expands and becomes more diverse post-retirement

 

In essence, retirement is not about losing your professional identity but expanding it. It’s about exploring new facets of who you are and finding joy in them.

 

It’s an opportunity to explore new passions, develop new skills, and create new social networks. May you take retirement as your opportunity to redefine what fulfillment looks like for you – whether it’s volunteering at a local charity, starting a small business, or going back to school.

 

And if you’re wondering exactly how you’ll turn your successful career into an even better retirement, we’ve got just the thing for you. Our Rewire Method masterclass is designed to guide you through this exciting transition. So, feel free to give it a watch.

 

#3 Social Isolation

We spend a significant portion of our lives working, and in doing so, we form bonds and friendships with our colleagues. 

 

The daily interactions at work can create a sense of belonging and community that is necessary for your social and emotional well-being. But, when you retire early, you might find yourself disconnected from this vital aspect of your life. 

 

That’s why it’s super important to have a game plan. By proactively creating a social network — whether through volunteer groups, joining a club, or even online through friendship sites — you can actively reach out and meet people with like-minded interests. 

 

This way, you’ll be able to stay connected while also exploring a new chapter in your life. And research shows that having strong social bonds is key to long-term happiness and well-being. 

 

So don’t be afraid to reach out and connect with people. It’ll make your life much more enjoyable — retired or not.

 

#4 Boredom

Early retirement can sound enticing, but once the initial excitement fades and you step out of the honeymoon stage, it can be challenging to adjust to a life without the structure and purpose that work provides. 

 

Having 40 extra hours every week might sound like a dream come true at first, but it can quickly turn into a nightmare if you find yourself feeling bored or even useless (which a third of retirees feel like in the first year of retirement).

 

the average retiree gets bored one year into retirement

 

And research suggests that two different types of people are vulnerable to chronic boredom — those who crave new stimuli all the time, and those who avoid risks due to fear: 

 

  • Craving stimuli — Those who are always seeking new stimuli might struggle to stay busy and satisfied with the same hobbies or projects for a long time. 
  • Avoiding risk — And those who are too scared of taking risks might have difficulty identifying new interests or activities that could provide them with the type of satisfaction that work once did.

 

No matter which camp you fall into, it’s important to find ways to combat boredom during retirement so you can enjoy the freedom and choices that come with it. 

Basically, instead of viewing boredom as a sign that something is wrong — use it as an opportunity to deeply self-reflect, get creative and explore all the possibilities that come with retirement.

 

#5 Lack of Mental Stimulation

Work can often provide mental challenges that keep the brain sharp. But when you’re in retirement, it can be hard to find new tasks that are intellectually stimulating.

 

In fact, according to research, people over 60 who are not working experience a higher rate of cognitive decline than those who continue to work on a regular basis.

 

While it might be tempting to stick with the same types of activities you did during your working years, it can actually be more beneficial to try something new.

 

Studies have shown that new experiences and places light up your hippocampus — the part of the brain associated with learning — far more than repeating familiar tasks. 

 

new experiences light up hippocampus

 

So if you’re planning on retiring earlier, it’s important to make sure you have activities lined up that will help challenge and stimulate your mind.

 

Consider signing up for new classes, taking on a part-time job, or even just traveling to new places.

 

And if none of those options appeal to you, there are plenty of brain games designed to help keep your mental abilities sharp — from crosswords to memory exercises.

 

No matter what you decide to do, make sure that the activities you choose help nourish your mind and keep it engaged — this will help prevent cognitive decline and ensure that your retirement years are as stimulating as possible.

 

Is It Better to Retire Early or Later?

Deciding when to retire is a deeply personal decision that hinges on various factors — your financial stability, health condition, lifestyle preferences, and long-term goals. 

 

Which means it’s crucial to weigh the pros and cons carefully. Here’s our recap.

 

The pros of early retirement are:

  • Freedom & flexibility — set your own schedule, travel at will, and live life on your terms without the constraints of a 9-to-5 job
  • Quality time — spend more quality time with friends and family
  • Personal growth — use early retirement as an opportunity to develop new skills, delve into interests, or even start a passion project
  • Lower stress levels — say goodbye to work-related stress and hello to a more relaxed lifestyle 
  • Chance to pursue a new career — explore the potential for a second career or entrepreneurial venture that aligns with your passions

 

On the flip side, the cons are:

  • Financial stress — brace yourself for potential financial stress due to having a fixed income, inflation, and unexpected expenses
  • Loss of identity — grapple with potential loss of identity if you’ve tied your self-worth to your career
  • Social isolation — stepping away from daily interactions with colleagues could result in feelings of loneliness and isolation
  • Boredom — without the routine and challenges of work, early retirement might lead to feelings of boredom and aimlessness
  • Lack of mental stimulation — consider the risk of reduced mental stimulation, as the intellectual challenges provided by work may be hard to replace in retirement

 

Whether you choose early retirement or decide to extend your working years, retirement is a chance to redefine your life on your terms. So, take your time, go inward to find clarity, and listen to your heart. 

 

Retirement is one of the most significant milestones in your life, so make sure it’s a journey worth embarking on. 

 

And if you want help, that’s our specialty – we shortpath your way to your best retirement life (early or not). Feel free to schedule a breakthrough session to see if it’s a good fit. 

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portrait of Cyn Meyer, founder of Second Wind Movement and a certified retirement life coach
Cyn Meyer 

Retirement Life Coach

As a certified retirement life coach since 2018, Cyn has helped thousands of older adults turn their retirement years into remarkable years full of growth, purpose, and passion. Through her signature program Rewire My Retirement, she helps people achieve their best life across the 5 Rings of Retirement, which covers topics Growth, Community, Health, Giving Back, and Finance.


Cyn combines specific life coaching tools, neuroscience, and her extensive background in marketing (spanning 17 years) to make a powerful impact with Second Wind Movement – an organization dedicated to providing educational resources and coaching for seniors.

With meticulous research, insight, and passion, Cyn’s mission is to usher in a new wave of positive experiences for generations of retirees.

portrait of Cyn Meyer, founder of Second Wind Movement and a certified retirement life coach

Cyn Meyer 

Retirement Life Coach

As a certified retirement life coach since 2018, Cyn has helped thousands of older adults turn their retirement years into remarkable years full of growth, purpose, and passion (beyond the stereotypical financial planning side of retirement). 

She combines specific life coaching tools, neuroscience, and her extensive background in marketing (spanning 17 years) to make a powerful impact with Second Wind Movement – an organization dedicated to providing educational resources and coaching for seniors.

With meticulous research, insight, and passion, Cyn’s mission is to usher in a new wave of positive experiences for generations of retirees.