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Updated Mar 4, 2026 · 3 min read

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Why early retirement can be more complicated

If you’re retiring early, you still face many of the same questions as someone preparing to retire at a traditional age: how much you’ll need to retire, for example, and how much you can withdraw each year without outliving your savings.

But retiring ahead of schedule magnifies those decisions. Instead of funding 20 or 25 years of retirement, your savings may need to last anywhere from 30 to even 50 years, depending on when you choose to retire and what expenses you’ll need to cover in those years. (Check out our FIRE number calculator if you’re trying to determine what that number is for you.) That longer timeline requires less margin for error, especially if markets decline in the first few years of retirement and you need to withdraw money from your investment accounts when the market is down.

But retiring ahead of schedule magnifies those decisions. Instead of funding 20 or 25 years of retirement, your savings may need to last anywhere from 30 to even 50 years, depending on when you choose to retire and what expenses you’ll need to cover in those years. ( Check out our FIRE number calculator if you’re trying to determine what that number is for you.) That longer timeline requires less margin for error, especially if markets decline in the first few years of retirement and you need to withdraw money from your investment accounts when the market is down.

Accessing your retirement accounts, especially if the bulk of your money is invested there, can also be complicated. It’s very easy to see how early retirement quickly grows more complicated than expected.

You must to be 59½ or older to avoid the 10% early withdrawal penalty from most retirement accounts.

Early retirees should consider strategies such as the Rule of 55 to tap into Social Security benefits early, substantially equal periodic payments (SEPP) under IRS Section 72(t) or Roth conversion ladders.

You'll also need to find health insurance before you become eligible for Medicare at age 65.

» How to plan for early retirement

» » How to plan How to plan for early retirement

Examples of early retirement strategies

Early retirement requires careful strategic planning. Here are two examples of what an early retirement strategy might look like. Talking with a qualified financial advisor can help you figure out what might work for you.

Let’s say you’re 50 years old and have most of your retirement savings in a 401(k) plan. One strategy a person might consider in this situation is to use the savings in a taxable brokerage account or cash account to cover expenses until age 59½, after which most people can begin withdrawing money from many types of retirement accounts without penalty IRS.gov. Retirement topics - Exceptions to tax on early distributions. Accessed Mar 3, 2026. . Other strategies include planning SEPPs or a Roth conversion ladder.

Let's say you're 60 years old and thus haven't reached Social Security’s full retirement age of 67 yet. The earliest age at which most people can take Social Security retirement benefits is typically 62, but those payments are normally reduced because people usually aren’t entitled to 100% of their benefits until 67. People who wait until 70 to retire can receive 124% of their benefits SSA.gov. Delayed Retirement Credits. Accessed Mar 3, 2026. . One potential strategy in this scenario is to begin withdrawing money from retirement accounts first, in order to delay claiming Social Security benefits for as long as possible.

When a financial advisor could make sense

Not everyone who wants to retire early needs help from a professional. But if any of the below apply, it may be beneficial to work with an advisor.

You’re managing a large financial portfolio. The more money you have, the more important tax efficiency and risk management become.

You’re managing a large financial portfolio. You’re managing a large financial portfolio. The more money you have, the more important tax efficiency and risk management become.

You want a well-structured withdrawal strategy. It's important to consider all your potential expenses and their timing in order to know what you'll need and when. Knowing when to take money out of taxable, pre-tax and Roth accounts over the years can make a big difference.

You want a well-structured withdrawal strategy. You want a well-structured withdrawal strategy. It's important to consider all your potential expenses and their timing in order to know what you'll need and when. Knowing when to take money out of taxable, pre-tax and Roth accounts over the years can make a big difference.

You want to do Roth conversions. Low-income years are ideal for Roth conversions, which means early retirement can be perfect timing. But you’ll have to decide how much and when to convert by projecting future tax brackets.

You want to do You want to do Roth conversions Roth conversions . . Low-income years are ideal for Roth conversions, which means early retirement can be perfect timing. But you’ll have to decide how much and when to convert by projecting future tax brackets.

You want a plan that also encompasses healthcare and Social Security. Retiring before you become eligible for Medicare and Social Security can affect your long-term income and should be part of a broader strategy.

You want a plan that also encompasses healthcare and Social Security. You want a plan that also encompasses healthcare and Social Security. Retiring before you become eligible for Medicare and Social Security can affect your long-term income and should be part of a broader strategy.

However, not everyone who wants to retire early needs help from a professional. You might not need a financial advisor if:

Your financial portfolio is relatively straightforward and easy to manage.

You understand how to sequence withdrawals and how it impacts your taxes.

You expect to maintain similar or lower cost of living in retirement that won’t heavily reduce your assets.

You’re comfortable rebalancing your own investments and reducing expenses when markets fluctuate.

» MORE: When to hire a retirement financial planner

» MORE: » MORE: When to hire a retirement financial planner

What a financial advisor does for early retirement

Typically, you can expect these services from the advisor:

Cash flow and spending projections. An advisor can turn your lifestyle goals into a year-by-year income plan, estimating how much your portfolio needs to grow in order to support expenses such as housing, travel, inflation, one-time expenses and more.

Cash flow and spending projections. Cash flow and spending projections. An advisor can turn your lifestyle goals into a year-by-year income plan, estimating how much your portfolio needs to grow in order to support expenses such as housing, travel, inflation, one-time expenses and more.

Retirement income and investment strategy. Financial advisors know that early retirees need an investment strategy that takes into account near-term withdrawals and long-term compounding.

Retirement income and investment strategy. Retirement income and investment strategy. Financial advisors know that early retirees need an investment strategy that takes into account near-term withdrawals and long-term compounding.

Tax-efficient withdrawal planning. With your advisor, you can map out when to take money out of taxable, traditional or Roth accounts, especially if you plan to do Roth conversions in lower-income years.

Tax-efficient withdrawal planning. Tax-efficient withdrawal planning. With your advisor, you can map out when to take money out of taxable, traditional or Roth accounts, especially if you plan to do Roth conversions in lower-income years.

Healthcare and Medicare planning. If you plan to retire before age 65, an advisor can help you manage your income to account for ACA subsidies and healthcare costs.

Healthcare and Medicare planning. Healthcare and Medicare planning. If you plan to retire before age 65, an advisor can help you manage your income to account for ACA subsidies and healthcare costs.

Risk and contingency planning. A financial advisor can help you think through plans for other areas of your financial life, including emergency reserves, insurance coverage, long-term care, and estate planning.

Risk and contingency planning. Risk and contingency planning. A financial advisor can help you think through plans for other areas of your financial life, including emergency reserves, insurance coverage, long-term care, and estate planning.

» Use our tool to find a financial advisor for retirement

» Use our tool » Use our tool to find a financial advisor for retirement to find a financial advisor for retirement

Cost of financial advisors for early retirement

Depending on what you need help with from a financial advisor, the cost can vary. Some advisors charge a percentage of your investment portfolio each year, while others charge a flat fee or hourly rate for specific planning services.

Fee type

Commonly associated with

Typical cost

Assets under management (AUM)

Managing your portfolio of stocks, bonds and other investments.

0.25% to 0.50% annually for a robo-advisor; about 1% for a financial advisor.

Flat annual fee (retainer)

Special projects, such as analyzing whether to buy or sell your business. May also provide more access to the advisor. In some cases, advisors may substitute flat fees for AUM fees.

Typically $2,500 to $9,200.

Hourly fee

Special projects, such as helping create a financial plan for a specific situation, such as a divorce.

$200 to $400.

Per-plan fee

Creating a detailed, written comprehensive financial plan for a client.

Typically $3,000, but varies by service.

Transaction costs and expense ratios

Fees that trading platforms charge the advisor to use, or fees that mutual funds, ETFs and similar instruments charge.

Varies; expense ratios may range 0.05% to 0.75%.

Custodial fees

Fees that the custodian charges you to hold your assets.

May be around 0.10% to 0.15%, but varies by account size, asset type, transaction activity and custodian.

Wrap fees

Bundles the firm’s investment management services and related custodial transaction costs together for one price.

Varies by account size and type.

Commission

Money earned from financial institutions for buying or selling certain products to clients.

3% to 6% of investment transaction amount.

To compile this information, we reviewed industry studies on average rates among financial advisors. Those studies included:

State of Financial Planning and Fees study (Envestnet, a company that develops software for the wealth management industry).

How Financial Planners Actually Do Financial Planning from Kitces.com.

We also reviewed fees charged by providers reviewed by the NerdWallet investing team.

» More on how much financial advisors cost

» More on » More on how much financial advisors cost how much financial advisors cost

Article sources

NerdWallet writers are subject matter authorities who use primary, trustworthy sources to inform their work, including peer-reviewed studies, government websites, academic research and interviews with industry experts. All content is fact-checked for accuracy, timeliness and relevance. You can learn more about NerdWallet's high standards for journalism by reading our editorial guidelines. IRS.gov. Retirement topics - Exceptions to tax on early distributions. Accessed Mar 3, 2026. SSA.gov. Delayed Retirement Credits. Accessed Mar 3, 2026. About the author June Sham June Sham June Sham is a lead writer on NerdWallet's investing and taxes team covering retirement and personal finance. See full bio.

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