Want To Retire at 60? See if You Can Answer These Five Questions
Forget waiting for Social Security and Medicare to kick in. You may be able to retire sooner than you think.


It's possible to retire at 60, even though the average age for retirement is 62. Many Americans want to retire early or at the latest, by 60. For some, they have no choice due to health issues, job loss, or a change in their family situation. For others, they are sick of working and are ready to start their next chapter. Either way, it's not uncommon to retire before Social Security and Medicare kick in.
“A lot of people, the goal of retiring prior to when they collect Social Security and Medicare stems from thinking they have to work longer and realizing they don’t,” says Cassandra Rupp, a senior wealth advisor at Vanguard. “It opens up the conversation.”
When it comes to retiring at 60, there are two buckets you have to consider: financial and emotional. Not sure if you can pull it off? If you can answer these five questions, you may be on your way to retiring at 60.
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1. Do you have a handle on your expenses?
Retiring at 60 sounds great, but to make it a reality, you have to ensure you can afford it. The only way you’ll truly know is if you have a clear idea of how much you’ll spend in retirement. “That will drive whether or not you can retire early,” says Nick Nefouse, global head of retirement solutions and head of LifePath at BlackRock.
Let’s say you have $1 million saved in your retirement account and spend about $50,000 a year. Not factoring in inflation, you will have spent $350,000 of that balance by age 67, when your full Social Security benefits kick in. That leaves you with about $650,000.
That may be a green light for you to retire at 60, but if you didn't know what your expenses were, you wouldn’t have realized you could pull the trigger early.
2. Do you have a way to fund retirement before Social Security kicks in?
Unless you are a widow or widower, you can’t begin claiming Social Security until 62, and ideally, you want to wait until your full retirement age to start receiving your benefits. If you collect early, you’ll see a 30% reduction in your monthly payout.
During the period you are not collecting Social Security, you’ll have to bankroll your retirement from other sources, whether it's your retirement savings, passive income from a real estate investment, or a side gig.
“You have to rely on your own portfolio for those years,” says Sharon Carson, executive director of J.P. Morgan Asset Management. “Do you have adequate resources to do that?”
If you are going to need Social Security early, how will it impact the quality of your retirement over the long haul? Will that 30% reduction in your Social Security benefits for twenty-plus years hurt you?
“People with healthy habits live a lot longer, and if you are going to live a lot longer, it pays more to wait,” she says.
3. How will you pay for health care?
Health care is a big cost in retirement. According to Fidelity Investments, a 65-year-old retiring in 2024 could expect to spend an average of $165,000 in health care and medical expenses throughout retirement. That’s up close to 5% from 2023 and more than double from its inaugural estimate in 2002. That’s only expected to increase over the years.
While Medicare covers 80% of some of your health care needs, it doesn’t kick in until you are 65. If you retire at 60, that means you will have to self-fund your health care for five years. You won’t have your company’s subsidized insurance to rely on either.
Sure, there is the Consolidated Omnibus Budget Reconciliation Act, or COBRA insurance, which enables you to stay on your employer-provided health insurance for a period of time, typically between 18 and 36 months, but it tends to be expensive.
You could join your spouse’s insurance plan if he or she is still working, but if you are both retiring or you are single, you will have to find health insurance on your own.
“A lot of couples retire at the same time,” says Carson. “If there isn’t a spousal plan, go on the government website or go on the Kaiser Family Foundation health insurance marketplace calculator and see what subsidies you qualify for.”
When determining if you can afford to retire at 60, make sure to factor in health care into your annual budget and what impact it will have on your retirement savings over those five years before Medicare kicks in.
4. What will you do with your free time?
The idea of sleeping in, kicking back and strolling on the beach may seem extremely appealing, but is it enough to keep you happy and busy for the next twenty-plus years?
The people who tend to be happy in retirement are those who have a purpose. Before you retire, make sure you know how you’ll spend your time, especially in that critical first year.
“Think about what I'm going to do that gives me purpose, gives me reason to get up in the morning," says Carson. “It doesn’t have to be a ‘save the world’ purpose. It could be I’ll do something with my neighbors, see my grandkids or socialize with others.”
5. Are you getting professional help?
Retiring at 60 is a big deal. Once you leave the workforce, it's hard to go back, which is why you have to think long and hard before you make the move.
That’s why it’s one of those decisions in which it pays to seek professional help from a financial adviser. A trusted adviser can test out different scenarios to see if you can make retirement at 60 work.
Not sure if you should wait beyond 62 to collect Social Security and draw from your 401(k), a financial adviser can help you figure that out. Confused about how your asset allocation should be since you are retiring five to seven years earlier? A financial adviser can help with that, too. “It doesn’t stop at retirement,” says Rupp. “There are further strategies to implement.”
It doesn’t have to be a dream
Retiring at 60 may seem like a pipe dream, but it's not impossible.
“You have to prepare ahead of time. You can’t decide at age 59, you want to retire at 60,” says Rupp. “You need at least a couple of years to prepare.”
But if you plan for it and consider how you’ll cover your expenses, health care and make up for a lack of Social Security benefits, you can realize your early retirement dreams.
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Donna Fuscaldo is the retirement writer at Kiplinger.com. A writer and editor focused on retirement savings, planning, travel and lifestyle, Donna brings over two decades of experience working with publications including AARP, The Wall Street Journal, Forbes, Investopedia and HerMoney.
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