Should I retire early or keep working? Keep working. If you have to ask, you’re not sure. Even if you already have all the money in the world, if you’re not sure, you can’t jump in with both feet. Early retirement is a life changing decision that you can’t afford to not be sure about.
Plenty of people retired early with their spouse only for it to cause divorce within 2 – 5 years of time. For whatever reason, one couldn’t take being out of the normal realm of working until retirement. They thought their friends were lapping them in social class.
Early retirement isn’t a decision to take lightly because it alters your entire universe and life as you know it. It’s not easy to go back to where you once were. It could be easy to be at a lower position than where you were. And then the question becomes was early retirement worth it in the first place?
Should I retire early or keep working? That question depends on many factors, highlighted below. However, the number one way you can tell you should keep working is that you’re not sure. I personally know exactly what’ll make me say I want to retire early.
Either $2mil in net worth or $75k/yr in passive income. That’ll give me enough money and provide for my family at the same time for the rest of eternity. I personally don’t care about climbing the corporate ladder but rather just doing good work in the meantime.
It’s a life altering decision in which there’s a clear cut answer at the end.
Should I Retire Early or Keep Working? 9 Things to Consider
Below are the 9 biggest things to consider in the should I retire early or keep working? debate. It won’t be pleasant making the wrong decision!
1) Do You Love Your Job?
Not if you like your job, but do you love your job? I personally love my current job. The job isn’t so challenging that it’ll cause burnout but not so boring that it doesn’t fulfill my needs. It’s the perfect balance between the two. Should I retire early or keep working?
If you love your job, you don’t have to retire early. Too many in the FIRE community don’t see the value of a 9-5. Some 9-5’s are worth more than their pay. Some are worth more than gold in that it has everything that you’re looking for and then some.
There’s nothing wrong with working longer so you can earn more steady paychecks down the road. Maybe build some generational wealth along the way as well. 9-5 income is much safer than building a business. It’s easier to snag a $200k 9-5 than start a business making $200k in revenue.
There’s no shame and nothing wrong with working until retirement. Hundreds of millions of Americans do it. If you dislike your job, it may be time to be changing jobs.
2) Should I Retire Early or Keep Working? Sabbaticals
Sabbaticals are growing in popularity as employees are burned out and tired from working so much and hard. Companies usually offer sabbaticals after a milestone period of 5, 10, 15 years and so on. They are a great way to get your feet wet on early retirement.
Should I retire early or keep working? If you’ve already taken a sabbatical for a month+ and you like it, then it’s a good sign to retire early. A month is a phenomenal time to gauge how you’ll feel during early retirement. A week or two is nearly not enough time to gauge.
Week long vacations always feel so short. If you find out you’re running out of things to do and you want more challenges, then it’s not time to retire early. You should keep working. It might not always be at a 9-5. It could be at starting your own business.
Whatever the case is, it’s not time to hang it up just yet. You have more work you want to accomplish.
3) Will You be Bored?
This is a serious concern and problem. Early retirement is not full of rainbows, sunshine, and unicorns. Boredom is a real concern because when you’re used to being on the grind 24/7, answering emails and getting stressed over work, having no stress is a drastic change.
Should I retire early or keep working? Not if you’re going to be bored during early retirement. A week’s vacation is not enough time to actually sample early retirement. After every week, it just feels so short and you want to rest up more.
Week long vacations never feels boring. Therefore, a prolonged period of stepping away from work is a necessity to seeing if you’ll be bored. I didn’t know it at the time, but summer breaks in between school made me feel bored. The 2 – 3 months for summer break was too much, in hindsight.
Knowing yourself if you can be preoccupied with meaningful and purposeful work is important. One of my coworkers is retiring early to focus on writing a book. That’s a commendable hobby to pursue and pass the time.
4) Are There Growth Opportunities At Your Job?
Some people are just born to work because they love working, leveling up, and getting promotions along the way. If there are growth opportunities at your job and you want those growth opportunities, then continuing to work is not a bad plan.
I personally have an unlimited opportunity to grow at my current company. I love that because I’m not stuck in any one position. Should I retire early or keep working? If you enjoy providing value through society through your work and your company recognizes your value, then there’s nothing wrong with working.
Early retirement is not the best thing since sliced bread. Early retirement actually came up to be a bull market phenomenon based on the Google Trends searches. Interest in financial independence, retire early tapered off after the bear market of 2022.
People started realizing, maybe continuing to work is not so bad after all. It fills up your time with meaningful work.
5) How is Your Personal Life?
Some spouses need that space in between business hours away from their spouse AND their kids. You can’t be around your kids all the time. Even though I like my coworkers, if I talk to them every day, they would drive me nuts and I need space. I need time away from them.
Should I retire early or keep working? Your personal life comes first, first and foremost. Generally, women like it when their husbands continue to work to old age. It shows their value in society and that they married a high value man.
Your personal life preoccupies the majority of your life in early retirement. Therefore, it’ll become more important than ever to tend to it. I personally need time away from a significant other from time to time. All my relationships, I needed space and time away from them to keep my sanity.
Your personal life is the most important during your working years but it’s even more important during your early retirement years.
6) Do You Have Enough Money For Your Family?
Inflation sucks and it’s on the rise and it’s only going to get more expensive from here. Can you afford the big ticket items for your kids? College? Medical surgery? Cars? I personally don’t believe parents should be on the hook for paying for their children’s car but at the very least, education.
Unexpected events happen all the time. I got in a car accident in 2022 in which the driver didn’t yield to a stop sign. Also, I almost got in a car crash in 2023 when the driver unexpectedly swerved into my lane on the highway.
I can’t imagine what would’ve happened if my medical bills exceeded insurance coverage.
Should I retire early or keep working? There needs to be a consideration for big ticket items. Life happens. Unexpected events happen. It’s a good idea to set aside an additional $10k/yr for worst case scenarios to happen. Life is not all sunshine and rainbows.
Large expenses creep up through no fault of your own. It’s best to be prepared for the worst and have the best happen.
7) Should I Retire Early or Keep Working? The 4% Rule
The 4% rule is a guideline for early retirement, not a hard and fast rule. It states that if you withdraw 4% of your portfolio and that covers all your expenses, you should be financially set. However it’s just a guideline.
Many relied on the 4% rule and lost their shirts because the markets acted more irrationally than historical suggestions. The best rule is a 3.5% withdrawal rule, at a minimum. Better if it’s 3% or below. Should I retire early or keep working?
Your expenses should at least be less than a 4% portfolio withdrawal rate.
If it’s not, then it’s not the time to retire early. The more margin of error, the better. This is not something you can afford to be wrong about because getting back into the workforce after potentially decades of not working is extremely difficult, if not impossible.
It’s hard to compete against the young ones who’ve been in the game for years straight. The financial aspect of early retirement can’t be ignored.
8) What Are the Motivations for Wanting Early Retirement?
There has to be good motivations for wanting early retirement. Not enjoying your work is not one of them. It means you still like working but you just don’t like the work you currently do. Good employers ARE out there. No matter how many complaints you see on social media.
Should I retire early or keep working? Motivation for wanting early retirement is crucial here. If your motivation is that you already made more money than you can ever spend in your life and want to spend more time with family? Then it’s a good reason to retire early.
I personally want to retire early to create a lifestyle business for myself. Some will see that as “working” I will see that as a hobby that happens to make money. Many retired early then realized that it wasn’t the 9-5 work that was causing them stress and bad feelings every day.
It was something completely unrelated, though the 9-5 was a contributing factor. Work may not be the only reason causing you distress. It may actually be a source of happiness.
9) Did You Take Care of Your Health?
Whether we like it or not, health declines over age. No matter how well we take care of our bodies every year, biology is our biggest downfall. Even athletes who maintain a strict diet throughout their entire lives have an achilles heel. Time.
One of my friends’ friend consistently ran marathons. He kept a very good physical shape on the outside. One day, he comes back from a marathon, was drinking water, and suddenly collapses and passes away. He had unknown heart conditions that limited his ability to do extreme physical exercise.
He never knew he had that heart condition. Should I retire early or keep working? It depends on whether you think you’ll have health problems down the road. You just never know what’s lurking in the background. Even in my 20s, I’m taking good care of my health.
The basics of eating well, not drinking alcohol, and getting quality sleep will always work in the end.
Should I Retire Early or Keep Working? There’s Pros/Cons
Too many decide to retire early without thoroughly seeing the pros and cons of either decision. It could be the right decision but it has to be planned well. I personally wanted to retire early in 2022 because I thought my spending/portfolio could support the decision.
Then the bear market of 2022 hit and it decimated my portfolio and my plans. Should I retire early or keep working? A thorough decision making plan is necessary to make that determination. After snagging the best job opportunity I could ever snag in my lifetime, I no longer want to retire early.
I’m having too much fun working and if I work at my current job for the rest of my life, I would be more than happy to do so. On the weekends, I work on my side business and on the weekdays, I work on my day job. It feels amazing and I want to keep working for the rest of my life.
Everyone’s motivations and reasons for retiring early are different. Many did retire early only to regret it down the road. There’s an old couple who retired in the height of the 2000 only to get hit with the tech bubble crash AND the financial crisis.
Although they didn’t have to go back to work, they were close to doing so in 2009. It’s not that easy to go back to the workforce after almost a decade of missing work. Should I retire early or keep working? A sound plan is necessary to make the right decision.
Companies are not benevolent creatures. If they don’t see a use for you, they won’t accept you.
Should I Retire Early or Keep Working? The Answer is Crucial
You don’t want regrets. When I was losing money hand over fist in 2022, I thanked my lucky stars I still had a job. Then I imagined what it would’ve been like if I retired early. I got lucky in that I didn’t let my confidence and ego get in the way of making the most profitable decision.
There are millions of similar stories across the world. The record bull market that lasted until 2021 made everyone think the good times last forever. They have enough money to set them up for life. That’s not the case. Bad times happen.
Even though I was lucky to have a job, it was hanging on by a thread. Layoffs across industries were piling up with no end in sight. Things weren’t going to get better, it was going to get worse as companies post lower earnings, and even losses.
Should I retire early or keep working? Retiring early after only experiencing bull markets is not the way to go. The bear market of 2022 scared everyone silly. 2023 wasn’t really expected to get better anytime soon, either. This is a very personal decision that is hard to reverse.
As people, we enjoy working and having a sense of purpose. Work is one way to feel the sense of purpose. No matter how much we dislike working, it provides a sense of purpose in that we feel respected in the world. We feel useful.
That feeling just can’t be beat by anything else. Making a well thought out decision is key.
Should I Retire Early or Keep Working? 9 Considerations Shortlist
- Do you love your job?
- Should I retire early or keep working? Sabbaticals
- Will you be bored?
- Are there growth opportunities at your job?
- How is your personal life?
- Do you have enough money for your family?
- Should I retire early or keep working? The 4% rule
- What are the motivations for wanting early retirement?
- Did you take care of your health?
