Retiring at 60 is possible with proper planning, but there are obstacles to overcome such as lack of access to Social Security benefits and Medicare. To retire early, it is important to save more, invest wisely, and consider part-time work to supplement retirement income. However, 60-year-olds can withdraw from retirement accounts without penalty. It’s important to note that those who retire at 60 will not be eligible for Medicare until they turn 65, resulting in lower Social Security benefits. With careful planning, early retirement can be achievable.
The Possibility of Retiring at Age 60
Many people dream of retiring early and enjoying their golden years without the stress of work. The traditional age of retirement is 65, but with proper planning, it’s possible to retire at age 60. However, there are some obstacles to overcome, such as lack of access to Social Security benefits and Medicare.
Access to Social Security Benefits
To be eligible for Social Security benefits, you must have worked and paid Social Security taxes for at least ten years. This means that if you started working at age 20, you would be eligible for benefits at age 30. However, the amount of benefits you receive is based on your average earnings over your working lifetime. If you retire at age 60, your average earnings will be lower than if you retire at age 65, which will result in lower Social Security benefits.
Access to Medicare
Another obstacle to early retirement is lack of access to Medicare. Medicare is a federal health insurance program for people over the age of 65 or those with certain disabilities. If you retire at age 60, you will not be eligible for Medicare until you turn 65. This means that you will have to find alternative health insurance coverage until you become eligible for Medicare.
Withdrawals from Retirement Accounts
On the plus side, 60-year-olds can withdraw from retirement accounts without penalty. This means that you can access your retirement savings without paying the 10% early withdrawal penalty that applies to withdrawals made before age 59 ½. However, you will still have to pay income taxes on the amount you withdraw.
Planning for Early Retirement
If you want to retire at age 60, you need to start planning early. Here are some tips to help you achieve your goal:
To retire early, you need to save more money than if you were retiring at age 65. This means that you need to be disciplined about your spending and prioritize saving for retirement.
Investing wisely is crucial to achieving your retirement goals. You need to choose investments that will provide you with the returns you need to retire comfortably.
Consider Part-Time Work
If you retire at age 60, you may still need to work part-time to supplement your retirement income. This can be a great way to stay active and engaged while earning extra money.
Retiring at age 60 is possible with proper planning. While there are obstacles to overcome, such as lack of access to Social Security benefits and Medicare, 60-year-olds can withdraw from retirement accounts without penalty. By saving more, investing wisely, and considering part-time work, you can achieve your goal of retiring early and enjoying your golden years without the stress of work.
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