How Do I Start Financial Planning for Early Retirement?

Thinking about financial planning for early retirement? You’re not alone. More people are seeking the freedom to step away from work in their 50s—or even 40s. But this dream doesn’t just happen. It requires smart decision-making, disciplined saving, and proactive strategies tailored to your lifestyle and goals.

Let’s walk through what it really takes to make early retirement a reality—and how working with a trusted financial advisor can help you get there faster and with fewer surprises.

What Does Early Retirement Actually Mean?

Early retirement usually refers to leaving the workforce before the traditional retirement age of 65. For some, this means retiring at 55. For others, it could mean leaving their job by 45. But no matter when you want to stop working, early retirement takes careful planning to replace your income and sustain your lifestyle for potentially 30 years or more.

Working with a financial advisor can help ensure your early retirement plan is built to last and can handle changes in the market, healthcare costs, and your lifestyle needs.

Step One: Define Your Early Retirement Goals

Start by getting crystal clear on your retirement vision:

• What age do you want to retire?
• Where do you plan to live?
• Will you travel or start a business?
• How much will your monthly lifestyle cost?

The earlier you begin financial planning for early retirement, the more flexibility you’ll have to design the life you want. And if you’re unsure where to begin, that’s where our advisors come in. We’ll walk you through these key decisions and help you prioritize what matters most.

Step Two: Know Your Numbers

To retire early, you need to know three critical numbers:

1. Your retirement number – how much you need saved to retire comfortably
2. Your annual spending – what your lifestyle will cost each year
3. Your income sources – how you’ll generate income without a paycheck

Most early retirees can’t rely on Social Security right away, so your portfolio needs to cover those gap years. A solid financial plan can calculate this for you and help you design a sustainable withdrawal strategy.

Step Three: Build a Strong Investment Strategy

A sound investment plan is the backbone of early retirement. Since your timeline is shorter, every dollar you invest must work harder.

Smart investment tips for early retirees:

• Maximize tax-advantaged accounts like Roth IRAs and HSAs
• Consider taxable brokerage accounts for flexible withdrawals
• Diversify to reduce risk
• Rebalance your portfolio regularly
• Avoid emotional investment decisions during market shifts

This is where working with our team can provide real value. Our advisors will help you build an investment strategy tailored to your timeline, risk tolerance, and income needs.

Step Four: Cut Unnecessary Expenses and Maximize Savings

The more you save now, the earlier you can retire. It’s that simple.

Ways to boost your early retirement savings:

• Eliminate high-interest debt
• Cut lifestyle inflation
• Automate savings
• Take advantage of catch-up contributions after age 50
• Redirect windfalls (bonuses, tax refunds) into investments

Every step forward makes a difference. Our financial specialists can help you find savings opportunities you may be overlooking.

Step Five: Plan for Healthcare Before Medicare Kicks In

One of the biggest early retirement challenges is healthcare. You may have to cover several years of health insurance costs before you qualify for Medicare at age 65.

Options to consider:

• Private insurance through the ACA Marketplace
• COBRA coverage from your former employer
• Health Savings Accounts (HSAs)
• Part-time work with benefits

Healthcare costs can derail a poorly planned retirement. Our team helps you prepare for this so you don’t face unexpected expenses or gaps in coverage.

Step Six: Create a Tax Strategy for Long-Term Income

Retiring early means your tax situation will change—and you need a plan to make the most of it.

Smart tax moves for early retirees:

• Strategically withdraw from tax-deferred vs. Roth accounts
• Take advantage of lower tax brackets in early retirement years
• Use tax-loss harvesting
• Avoid early withdrawal penalties where possible

A financial advisor can help you build a custom tax strategy that keeps more of your money in your pocket. That’s one of the many ways we help clients protect their wealth over time.

Step Seven: Prepare for the Emotional Shift

Retiring early isn’t just about money. It’s about purpose. Many early retirees struggle with identity, routine, or a sense of contribution once they leave their careers.

Ask yourself:

• How will I spend my time?
• What gives me a sense of meaning?
• Will I stay socially connected?

Our advisors often help clients think through the non-financial aspects of retirement. It’s about preparing for a new lifestyle, not just a new budget.

When Should You Work with a Financial Advisor?

Ideally, you should begin financial planning for early retirement as soon as the idea enters your mind. Whether you’re five years out or just getting started, partnering with a fiduciary advisor brings clarity, strategy, and peace of mind.

We can help you:

• Calculate your retirement number
• Build a personalized investment strategy
• Navigate taxes, healthcare, and Social Security timing
• Adjust your plan as your life evolves

Don’t go it alone. Our team is here to support your goals and help make early retirement a reality.

You Don’t Have to Do This Alone

Financial planning for early retirement can feel overwhelming—but it doesn’t have to be. With the right team behind you, your goals become not only achievable but sustainable.

We’ve helped hundreds of clients design retirement plans that reflect their vision, values, and lifestyle. If early retirement is your goal, let’s build your plan together.

Start your financial freedom journey today. Book a call with one of our advisors.