For many, retirement conjures up a single image: leaving work at age 60+ and stepping into a life of leisure. In reality, retirement is far more nuanced. We see people rethink not just when they retire, but how and what they want this next chapter to look like. Retirement is a spectrum of possibilities. Below are a few common ways we see people approach retiring earlier, and considerations for those who choose to work longer.

Retiring Early

Although many people fantasize about retiring early, the experience can vary widely. For most, it doesn’t mean never working again, it means redefining how work fits into their life. Here are a few ways early retirement can take shape:

Mini Retirement

You think about retiring early but get nervous about such a big decision. Consider a ‘mini retirement’ as a great test run. This might look like a prolonged vacation, stay-cation, or even a sabbatical. We find that many clients in their 50s and early 60s have significant PTO built up and the ‘mini retirement’ can be a great way to capitalize on this accumulated vacation. Sabbaticals vary widely by employer and industry, but longtime employees who’ve demonstrated real value to their organizations likely have room to negotiate a prolonged break if their company doesn’t offer them.

Ideally this break is long enough that you get a real sense of retired life, one to two months at least. How did you fill your time? What happened when the initial exhilaration wore off? What aspects of your work life did you miss (if any)? A mini retirement can provide clarity without requiring a permanent decision.

Gradual Reduction

You love the idea of retirement, but you’d like to ease into it. Explore the ability to slowly reduce your hours and responsibilities. Our clients have experienced that employers are increasingly open to this, especially if you have tenure, as they recognize the value of not losing extensive institutional knowledge all at once, and possibly training the next generation. Going from 40 hours a week, to 20, to zero can happen over several months, or even several years.

Part-time Work

“Wait a minute, isn’t that cheating? I thought we were talking retirement!”

If I had a dollar for every time one of our clients picked up a part-time job in retirement, I might be retired myself! Whether it’s in the same field or a 180-degree turn, many folks work part time after formally retiring.

Sometimes it’s about extra income (even when it’s not strictly necessary) but more often it’s because of the non-financial benefits. It can provide social and intellectual stimulation, or a sense of contribution to their community. For others we’ve heard it gives them “somewhere to be” or “it keeps my spouse from divorcing me.” I’m only partially kidding on the last one.

Financial Considerations for Early Retirement

When evaluating early retirement, certain financial factors deserve special attention:

If you’re fortunate enough to have a traditional pension, that reliable income stream can offer significant flexibility — allowing you to leave a current job, do something more enjoyable (or just different), and avoid a drop in income.

Pension or not, healthcare can be a major hurdle. Medicare coverage isn’t available until age 65, so you’ll need to budget for a retiree health plan or private insurance. Many people are surprised by the cost, which can easily exceed $1,000 per month per person, especially if they had employer-subsidized coverage previously.  

Cash flow planning is also critical. Where will your monthly income come from? Traditional retirement accounts (IRAs) can’t typically be accessed penalty-free until age 59½. Social Security can begin as early as age 62, but benefits are significantly reduced if you start early and further reduced if you have work income prior to full retirement age. Pension benefits may also be reduced if taken before a certain age.

Strategies like 72(T) and rule of 55 distributions could fit your situation, but they require a careful approach to avoid potentially significant tax issues. And if you think you can live on less money than you do now, testing that theory before you actually retire is important.

Retiring Later

If you are concerned about outliving your assets, or if you love your job (these people do exist), working closer to age 70 may be the route to take.

There are benefits to working longer: more time to build up your nest egg, continued access to employer benefits (like health insurance, retirement plans, and flexible spending accounts), and higher Social Security benefits for those who delay claiming past full retirement age.

The downside to retiring later is uncertainty. None of us know how long we’ll live or when our health might change. You may have other things you would like to do with your time, or a ‘bucket list’ of trips and experiences. It’s easy to keep telling yourself, “When I retire…” but in our experience that has its downsides too. We encourage you to do the meaningful things you really want to do whether you’re working or not. With more intentional flexibility built into your schedule, some bucket list items may not need to wait.

There’s No ‘Right’ Retirement – Only Yours

There is no blueprint for retirement and no universally ‘right’ age. It’s a deeply personal decision shaped by your financial resources, health, relationships, and what matters most to you.

Just in the last year, I’ve had examples of both types of retirees. A 58-year-old healthcare worker who fully retired due to the stressful nature of their job. They haven’t looked back!  On the other side of the spectrum, a 70-year-old flight attendant who loves their work and, because of their seniority, gets to select their preferred routes and schedule each month. They’re working as much as they like — but no more!

With careful planning, retirement — however you define it — can be a chapter where your time, energy and values are more aligned than ever.

Retirement doesn’t have to be figured out all at once. Talking with your financial planner can help you clarify what’s possible, weigh your options, and move forward with confidence—on your timeline.