How Is Early Retirement Even Possible?

Early retirement has been extremely popular lately, and I’m sure you’ve been hearing about it a ton. Between “Why I Hate the FIRE Movement,” says Suze Orman (from Afford Anything), Mr. Money Mustache, and any of the other amazing FIRE blogs, early retirement has been in the news a lot lately. And, I love it!…

Michelle Schroeder-Gardner

Last Updated: May 25, 2024

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What is considered an early retirement?Early retirement has been extremely popular lately, and I’m sure you’ve been hearing about it a ton.

Between “Why I Hate the FIRE Movement,” says Suze Orman (from Afford Anything), Mr. Money Mustache, and any of the other amazing FIRE blogs, early retirement has been in the news a lot lately.

And, I love it!

But, I know there are a lot of people who are confused or even skeptical of what early retirement is and whether or not it is a real thing.

First, if this is the first time you have heard of FIRE, it stands for Financial Independence, Retire Early, and it can mean a lot of things to different people. But, the basic idea is that you work towards financial independence– either having enough saved and/or enough passive income to cover your expenses. You can then choose whether or not you want to work.

That sounds pretty amazing to me!

For most people, though, retirement means something that only older people do after decades and decades of working at a full-time job. However, there are many out there who sadly aren’t saving enough money when preparing for retirement at the traditional retirement age of 65-67. And, as pensions become a thing of the past, saving for retirement will become even more important.

According to one survey, 56% Of Americans Have Less Than $10,000 Saved For Retirement. According to a different survey done by Bankrate, 36% of people in the U.S. have absolutely nothing saved for retirement.

Even though it’s obvious that there are many people out there who need to make saving for retirement a priority, there are lots of people criticizing those who are making it a goal to retire early.

I see this a lot when I read articles about people who have retired early. I always scroll down to the comments of these articles because I find it interesting to see what people have to say about early retirement. I probably shouldn’t because I am always shocked, and saddened, when I read all of the negative comments.

People say that those who retire early won’t be prepared for emergencies and how boring it would be to retire early.

Really, what could feel better than working hard to your save money, investing it well, and then realizing the financial freedom you have to quit your day job so you can live your dream life!?

Whether you want to travel, continue working (Yes, you can continue working! There’s no rule that you have to quit all together.), spend more time with family, or whatever else, early retirement gives you the ability to choose your own future.

I have saved enough to retire whenever I would like. Yes, I earn a high income, but I also save a large part of my income and watch any wasteful spending.

And, don’t worry, I love my blog too much to retire anytime soon, but knowing that I can retire early just means that I am prepared for whatever might happen in the future. As you know, I’m a worrier, and I would much rather be safe than sorry. There are so many what ifs, like there could be a medical emergency, the industry may change, I may change, and so on.

To me, having the ability to retire early is all about freedom and flexibility.

Plus, early retirement can happen at whatever age you want it to happen, as long as you are prepared! A lot of the big stories about early retirement are about people in their 30’s, but you can retire early at age 60, and that’s still awesome!

The point of early retirement is really about striving to better yourself financially. It means getting out of debt, spending less than you earn, and saving for the future.

There are a lot of amazing people who are doing extreme early retirement, like those in the FIRE movement (who I love!). I have heard of people who have sold all of their possessions and moved into a van so that they can retire early, but I know that isn’t for everyone.

Not all early retirement paths have to be that extreme, some can actually be quite normal. It’s just about getting rid of your debt, lowering your expenses (which will automatically happen when you get out of debt), spending less than you earn, and investing money for your future.

Many people can still live a normal life while they prepare for early retirement too. Planning for your future just starts with being realistic about your income and spending, then you can set whatever early retirement goal suits you from there.

Related content:

How is early retirement possible?


How to calculate the amount you will need to retire early.

Planning for early retirement means that you will have to very carefully consider all of your different expenses. For most early retirees, that starts by creating a budget that allows them to really know their expenses and save for them well into the future.

A person planning for early retirement is thinking about what ifs and emergencies as well. No one is going to have their calculations correct down to the penny, but you can factor in possible future expenses.

Still, many people don’t believe that early retirement is possible. There are lots who think that $1,000,000 – $5,000,000 isn’t enough to retire young, and that early retirees aren’t thinking about future expenses, when they really are.

I believe this has a lot to do with the fact that many people don’t understand compound interest and investing. Both of these things let your money work and grow for you, well into the future, meaning that an early retirees’ retirement funds are most likely going to grow and will cover annual expenses and emergencies.

Early retirees aren’t just multiplying their annual expenses by 25 and assuming that will be enough money for the rest of their life. They know how investments work, are staying diversified, and have backup plans if necessary.

When you save enough of your money and only live off of a designated percentage of your savings or invested income each year after you retire early, you will find that early retirement is possible.

Before throwing the whole idea out, you may want to see how you are prepared for retirement and how early retirement may be possible for you. 

Whenever I read an article about someone who retired early, I always scroll down to the comments because I find it interesting to see what people have to say about early retirement. After all, just a few years ago, I myself, didn't even know that retiring early was a thing. However, once I realized that people were doing it and living financially free lives - I knew I wanted it as well.
Retirement Calculator:

As you can see from the above:

  • With just a 1% savings rate, it would take you 98.9 working years until you reach retirement.
  • A 5% savings rate means that it would take you 66 working years to retire.
  • A 20% savings rate means that it would take you 37 working years to retire.
  • A 50% savings rate means that it would take you 17 working years to retire.
  • A 75% savings rate means that it would take you 7 working years to retire.

So, by saving more of your money, you are likely to retire sooner. Makes sense, right?

And, that’s what early retirees are doing! They have gotten out of debt and live off of less than they earn so that they can save at a much higher rate.

Related content: Do You Know Your Net Worth?


You’ll find plenty to do in early retirement.

I have heard from so many people that retiring early isn’t something they want because they’ll be too bored.

To be honest, I think this is just crazy!

If you are looking to retire early, you probably aren’t the type to just sit around all day. I mean, if that’s your plan for retirement, that’s totally fine because you get to choose. But, for many, early retirement still means working to some extent, while also having the freedom to spend your time pursuing your passion, traveling, spending more time with friends and family, and more.

With all the extra time you have after retiring early, you could volunteer, pursue a passion, find fun things to do, take up a hobby, and more.

Early retirees aren’t lazy and just looking for a way to escape the work world. I actually believe they are very hard workers, who want to live life on their own terms.

Heck, you could even continue working like many early retirees do, if that’s what you truly desire. Knowing you can retire early just gives you choices in case something changes in the future.

For me, if I chose to stop working one day, I could easily find time to fill my day. I could travel even more, go on more long hikes, be more fit, read more, learn more (I’ve been wanting to learn a new language), find a passion project, spend more time with friends and family, etc. The list is endless!

The average early retiree, that I know, has a very active and meaningful life.

Related: What Is Financial Independence, Retire Early? Answers To FAQs About FIRE


You can still enjoy life while saving for early retirement.

I think this is one of the hardest things for people to understand about retiring early.

Just because you are saving for retirement doesn’t mean you are eating ramen noodles for breakfast, lunch, and dinner.

There are plenty of ways to have frugal fun, eat on a budget, and so on. You can even see the world, while you are saving for early retirement.

Remember, the best things in life are free. The outdoors, spending quality time with those you love, laughing, and more are all FREE.

Related: 13 Best Early Retirement Books

When do you want to retire and when WILL you retire? What do you think of early retirement?

Michelle Schroeder-Gardner

Author: Michelle Schroeder-Gardner

Hey! I’m Michelle Schroeder-Gardner and I am the founder of Making Sense of Cents. I’m passionate about all things personal finance, side hustles, making extra money, and online businesses. I have been featured in major publications such as Forbes, CNBC, Time, and Business Insider. Learn more here.

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  1. I want to retire now and I think I did. But I don’t want to stop working on my blog just like you. Does it sound contradicting? ๐Ÿ™‚

    Agree with you that retiring early doesn’t mean living a meaningless life. There are so much more time to live, breath and experience life than the monotonous “I hate my job but I have to spend 8 hours of my life there daily.”

    For some unknown reasons, almost all my working friends aren’t happy with their job. They complained every time we meet, for years, decades. But they are not doing anything to change things.

    If they’d made early plans to save and invest, they may have the chance to escape and indulge in the passion of their life.

    And it is so true that saving doesn’t mean living a difficult life. One less branded bag can provide meal for a couple of months. Walking 15 minutes instead of cabbing can save money and make us slimmer and healthier. But I guess it’s a habit and preference.

    Thanks for sharing this post. Hope it can help someone live a more fulfilling life.

  2. I love that you said a person can early retire at 60! Because that’s exactly what I did 3 years ago. I had planned to work until 70 because it had been so much fun. But things changed when I was 58, and I fell out of love with my job. But because we had been frugal and I had earned a fairly high paycheck I was well past FI. So I walked away to a better life of a little consulting, a little volunteering and a lot of play! Great post!

  3. This is such a great post Michelle! I love how you said that the best things in life are free because they truly are. I think a lot of people look at early retirees as these super frugal penny pinchers that don’t have any fun in life. This is so not true, there are many ways to have fun on a budget you just have to be willing to make some changes in your lifestyle. Awesome post and Happy Sailing Michelle!

  4. Great overview. I think people focus on the “Retire Early” part of fire too much. The focus should be on the “Financial Independence” part since that’s what will ultimately allow you to retire early, continue working start a new project etc. And a lot of financial independence is based on how much you spend.

    Someone who can comfortably live on $2000 a month will have a much easier time hitting financial independence than someone who needs to spend $10K a month. Putting the brakes on overspending is always going to be the first step.

  5. I have no comprehension for how people think retirement means boredom! Oddly enough, these are often the people unhappy with their jobs.
    After years of very low income, I feel like we’re still getting ourselves into a good financial situation and that has meant gradually ramping up retirement savings. My parents retired around age 56. They had both worked full time, lived frugally, and saved most of one of their incomes for decades. I don’t have any current plans for early retirement because I like what I do, but I don’t see why anyone wouldn’t want to be financially independent! We’re definitely working on that.

  6. Reba

    I retired at age 62 after mentally planning it for about 3 years, financially planning before that. It also helps that my husband is still working (he loves his job, I HATED mine) and at 66 took Social Security. I have never regretted retiring and can’t wait until my husband retires also. The only shame is that almost all of my friends close by are still working and have no plans financially to retire.

  7. I’m 55 and could probably afford to retire now, but I want to travel to Europe every year, which is REALLY exxy when you’re coming from Australia. So I’ll work a few more years so Old Lady Frogdancer can live the life she wants without money worries.
    I’ll still consider that to be retiring early. The Age Pension kicks in at around 67 – 69, so that’s still a lot of freedom that I’ll be having.

  8. Sherene Astrup

    I can teach you to speak Danish? ;)…spent several years there and brought back hubby/kid, but still remember it….not the most useful language to learn, but still interesting (and also means I understand Norwegian and Swedish, not quite as well, but pretty decent)

  9. niraj

    I have a lot of time in retirement now I haven’t made any plan for my retirement, But this post has compelled me to think. Thanks for this post.

  10. Mira

    I’ve never really given much though to retirement since I’m still only young but this post has given me some good insights!

  11. One thing many people don’t know is they could have retired years ago had they been properly educated about awesome benefits of incorporating a side hustle as a secondary form of employment into their daily working routine. Speaking on my behalf, I could have been a side hustle millionaire many years ago had I known what I know now today and put those thoughts and other things into fruition. The beauty about retirement is you no longer have to work for a company 20, 30 or even 40 years in order to retire successfully with a healthy pension. all you need now a days is an internet connection, home computer or laptop, headset with microphone, a domain name, blog and join a few good affiliate networks so that you can create quality content for your and make money full time from affiliate marketing potentially 24 hours a day. This is the beauty of early retirement and defeating your narcissist employer. ๐Ÿ™‚

  12. I agree with you on this one 100%. Stuff what other people say. Everyone is entitled to their opinion regardless.

    But when people say you would get bored retiring early? That’s madness! I think that’s a very old school & conservative way of looking at it. Most of my family is like that as well, unfortunately!

    The ability to do whatever you want, when you want is really a special and unique thing.

    I rate early retirement is the way to do it. It doesn’t mean you have nothing to do, you just get to do what you wanna do everyday!

  13. Millie K. Dooley

    The conversation on FIRE has been kind of surprising–who’d’ve thought Suze Orman would be opposed to it?! I think her perspective is a little skewed, as wealthy as she is.

    My parents never had outrageous incomes, but saved diligently and are enjoying the heck out of their retirement. They work out multiple times a week in multiple ways, take interesting classes, and try out new recipes all the time. I’m so jealous of them! I love my job, but can’t wait for their level of freedom in choosing a day’s activity. That’s what financial independence means to me.

  14. Thanks for posting this. Reading this got me excited about saving and investing for early “retirement” just like the first time I read about it a long time ago.

    Now I kinda feel like scraping together everything I can and dropping it into my investment account, but thankfully my wife is willing to step in front of the laptop and instill some reason into me before I completely empty out the change purse!

    Love the article.

  15. Gail M Jeznach

    I d love to retire now but i have at least 15,000 $total debt it ll take me a long time to pay it off cant get a koan credit score isnt good so i keep plugging away i m hopeful for 7 yrs when i can retire maybe only work 2 days a week instead of 6 but i like your ideas