Can I retire early?
Our expert weighs in on how to assess if you're ready.
May 9, 2005: 9:15 AM EDT
By Walter Updegrave, CNN/Money contributing columnist
NEW YORK (CNN/Money) - Could you discuss some pros and cons of early retirement? And how do I evaluate whether I can afford to retire early?
-- Judith Grout, Sun Valley, Calif.
I don't think many people will have trouble contemplating the pros of an early retirement. The upsides of cutting out of work early are the basis for much of our daydreaming, the pleasant reveries that get us through difficult days.
What's not to like? After decades of work, you get to unshackle yourself from your 9-to-5 (or, as is often the case these days, 8-to-6) ball-and-chain of a job and get a chance to do all the things you'd like to do. Hiking the Himalayan foothills, taking a cruise through the Norwegian fjords, fly fishing in Montana or Vermont, donating time to your favorite charity.
The cons of early retirement:
Alas, harsh reality often intrudes on this pleasant idyll.
First, there are lifestyle and emotional issues. Some people are just so focused on breaking away from their jobs that they don't think through how they'll actually spend their time. As a result, after an initial period of euphoria, one can begin to feel listless and disengaged.
Similarly, some people look forward to revisiting an interest or activity they'd dropped earlier in life -- painting, taking up a musical instrument, perhaps -- only to find that they don't have enough skill in that area to make the activity fulfilling to them.
Then there are the financial issues. Retiring early means you'll need to generate an income large enough to support you for 20, 30 even 40 or more years. That's a daunting without that regular paycheck (not to mention raises) coming in.