Retiring early is a dream many of us share. Just imagine, no more deadlines or working long hours. You’d be your own boss with more time to indulge in your hobbies and interests. It’s not difficult to see why many people look forward to it.
Now, you have a range of other flexible options for your retirement savings. Of course, this has opened up new possibilities for many people with decent-sized pots to retire earlier than they had originally imagined.
So, how soon could you retire after the age of 55? And could you really afford to? At the age of 55 it will be more than a decade before you can claim your state pension at the age of 66. It’s also worth remembering that your retirement income could need to last for up to 30 years.
The key to understanding whether you can afford to retire at 55 and have a comfortable retirement is to create a financial plan.
Start by gathering together some accurate figures for your incomings and outgoings and then putting these into an online budget calculator.
Next, you’ll need to work out what your cash flow situation is likely to be by checking your current and previous pensions, plus any other forms of income. For example, you may decide you’d like to have more of a phased retirement, and rather than stop working completely to carry on working part-time.
How can I check my current pension?
The simplest way to work out your pension income is to use a pension calculator.They take only minutes to fill in and will give you a forecast of your likely retirement income and help you to work out if your current contributions will meet your needs. Before you start, you’ll need to get an accurate statement from your personal pension provider.
How can I track down old pensions?
It’s also possible that you have paid into one or more workplace pension schemes with previous employers during your working life.
Your pension providers should be able to provide you with an annual statement of the value of your fund. However, you can contact them to get an up-to-date statement. If you haven’t got the details of your old pensions the government pension service has a Pension Tracing Service.
Now you know how to make an early retirement plan, but whatever you decide it’s also worth talking to an Independent Financial Adviser for more informed guidance. Now find out more about how to plan your income and expenses in retirement.
The information on this page was sourced between June - October 2020 and updated in April 2021. Information on this site does not constitute any form of advice, representation, or arrangement by us and you take full responsibility for making (or refraining from making) any specific investment or other decisions. You should take independent financial advice from an adviser who is registered by the Financial Conduct Authority.
At Yorkshire Building Society we created Our Money Movement because we could see how most of the information for people approaching retirement was overly complex and full of jargon and hidden charges. Our aim is simple. To provide plain, straight talking guidance to help you make informed decisions about your financial future.