Early retirement — a blessing or a curse?

Who doesn’t dream about retiring? Better still, if you can get out of the game sooner than age 65.

While retiring while you're young and healthy enough to enjoy all that free time may sound alluring, there might be some downsides to that plan.

Not to burst your bubble, but early retirement is not a panacea. Before you rush to tell your boss goodbye, consider these issues:

Reality check

“Your Social Security benefits will be smaller the sooner you start to take them. A longer retirement also means that your savings need to last longer [and there's less time to contribute to them]. If you retire before you’re eligible for Medicare, you’ll need to pay for health insurance” too, says Joshua Zimmelman, president of Westwood Tax & Consulting in Rockville Centre.

Emotions matter

“It could be challenging if your spouse has to continue to work while you retire early,” points out Walter Wisniewski, a certified financial planner with Arcadia Wealth Management in Smithtown.

You also need to realize that transitioning from a set schedule and working with others to being active and social on your own isn’t always easy. Some early retirees get bored, depressed or sick. Are you really ready to give up your job? How will you spend your time?

Make it happen

Meet with a financial adviser to create a strategy. Estimate your budget. If you want to retire early, is it likely that you will have the means to live within that budget? Will your funds last for your lifetime? Be realistic.

Says Zimmelman, “Deciding when to retire isn’t a one-size-fits-all situation. Carefully figure out the perfect age to start. If you stop working too early, you might not be able to afford it, but if you wait too long, you might not have time to enjoy your retirement. You have to take into consideration your health, your life expectancy and your financial obligations.”