10 Times Breaking The Rules Can Help You Retire Early

Retirement savings strategies are governed by a few key rules. This set of guidelines helps workers stick to the plan and achieve their desired outcome. Generally, this means working full time for around 40 years, saving along the way, and then leaving the workforce to settle in greener pastures. But some workers have different ideas: The desire to retire early is a powerful one, and few people want to work longer than they have to. With the right alternative strategies in tow, it's entirely possible to hit your savings goals faster than expected and say goodbye to working life early. Even if it's just an extra year or two, that additional time can be immensely valuable to a person looking to travel, spend more time with loved ones, or just slow down a bit and enjoy the life they've built for themselves.

Throwing out some of the time-honored rules of retirement preparation is essential if you want to retire early. These rules are built around the standard flow of savings and time, but hanging it up a year or more ahead of schedule requires you to save a greater volume in less time, plan for the extended drawdown phase, and more. These ten rules are established components of a standard retirement savings strategy, but if you're seeking an alternative route into the lifestyle of leisure that waits at the end of the road, it's probably time to kick them to the curb.

It's often been thought that working hard and remaining a loyal part of your company's team is the best way to maintain financial stability and rise through the ranks. In decades past, the longevity of a working relationship and strong company loyalty were often prioritized in the workforce, but modern companies don't value their employees' loyalty any longer and workers are more discerning about what their career really serves. The typical worker today will change jobs upwards of a dozen times throughout a roughly 40-year career. This comes as a result of many pressure points, including layoffs, firings, and willful departures. While changing jobs can be scary at the best of times, it can also be a blessing in disguise.

Willis Tower Watson found companies gave their employees annual raises averaging 3.5% in 2025, while the Bureau of Labor Statistics reports median wages increased by 4.8% from early 2024 to early 2025. While these rates will naturally vary across industries or during leaner years, Metaintro reports that job switchers can anticipate a bump in pay ranging from 15% to 20% across all industries, with rate increases as high as 30% for high-demand work environments like medicine, tech, or finance. Similarly high increases may also be accessible to high performers who can demonstrate a lengthy track record of successes in their industry. There's a balance to be struck here — changing jobs on an aggressive, rolling basis can ultimately create more questions than opportunities — so picking your moments is crucial. But those looking to get out of the workforce altogether may find the potential gains worth the effort.

In addition to the bygone notion of becoming a company man or woman and sticking it out with your colleagues, those who want to retire early should actually reconsider their entry point into the working world altogether. As children, Americans are constantly told by parents and other loved ones that they can be anything they want when they grow up. With a coherent goal and the willpower to see it through, many do have the ability to carve their own paths and chase their dreams. While that's an undeniably noble pursuit, those who want to retire early may sometimes run up against competing aspirations. Some collegiate degree programs unlock access to fairly low-paying careers. These programs provide the training necessary to do what you love, certainly, but you won't always get the financial benefits that others are able to enjoy.

A young person who wants to retire early might subscribe to the FIRE movement instead, working diligently to save for their retirement so that they can exit the workforce as quickly as possible. For these savers, the dream isn't the job, but what comes after it. Others may not be as dedicated to this process, but safely retiring in your 50s, for instance, still demands a certain threshold of sacrifice. If your dream of retiring early outweighs your career aspirations, the reality is that the work you do is far less important. Therefore, it may be better to select a job you might not like as much in order to earn a higher salary and support your future aspirations more fully.

It's generally advised that consistent saving for retirement with the help of stable growth assets like exchange-traded funds (ETFs) and index funds can take the guesswork out of funding your life once you stop working. Funds that track the market have produced a quality track record in the past, and experts suggest prioritizing them remains a fairly reliable strategy. For savers working on an elongated timeline, going that investment route fits with standard retirement planning frameworks. Building some risk into your portfolio might still be valuable, but perhaps a little less necessary. On the other hand, savers hoping to retire early must gravitate toward higher-risk options, especially early in their savings voyage.

An appetite for expanded risk will help drive additional growth, which is an essential ingredient when looking at a shortened savings horizon. Not only do you have less time to put money away for your exit from the workforce, you'll also be working with a need to save more than the typical retiree because your retirement years are likely to last longer. Not every individual stock pick you make will be a winner, but if you focus on this strategy early, you'll have plenty of time to course correct if things go wrong. But a stock that does perform exceedingly well has the ability to lift your portfolio to new heights, ballooning its value and delivering on the expanded requirements you have for the account.

The idea of maintaining a healthy work-life balance has gained serious traction in recent years, and the millennial generation is particularly adamant about this healthy equilibrium. Workers across the board are seeking healthy changes to the way they interact with their office responsibilities. They often want to spend more time with family, leave their workplace woes at the door after 5 o'clock, and even seek frameworks to help say 'no' to requests that go beyond the scope of their job description more regularly. The idea of rolling back the clock on these advancements might touch a nerve, but some individual savers may be able to thread the needle in a way that works for them.

If you want to retire early, though, there's no ignoring the reality that you'll have to make some compromises. One such compromise is to reduce the amount of free time you enjoy. This means either retiring with fewer assets than you hoped to accumulate or spending more time at the office to generate additional income throughout your working years. Some will seek to work more hours to drive additional commissions or bonus figures, while others might take up a remote side hustle to add an additional stream of income to their budget. This can be particularly impactful for younger workers who may not have the same level of personal commitments that an older colleague has to navigate.

A common rule of thumb is to save a multiple of your salary by the time you reach a few key milestone ages. One of them is saving ten times your salary by 67. Of course, those retiring early won't still be working at this age, so this rule falls a little flat right out of the gate. Early retirees will also need more capital to support themselves throughout their lengthy retirement, so this target —even when extrapolated backwards to a younger age — isn't likely to offer value for additional reasons.

Fidelity has offered a different framework, suggesting a 14-times salary target by the time you hit 62. Even though the average retirement age for American workers is 62, this might still be considered early retirement for many since 67 is the threshold for receiving full retirement benefits through Social Security. It also offers significantly more principal value than a ten-times salary target for your savings, aligning a little more closely with the expanded needs of early retirement. For those eyeing an exit even earlier, another signpost of financial preparedness is to estimate your required budget in retirement and save 25 times that figure.

Some financial pundits treat all debt negatively. However prevailing wisdom within the industry is that some debts are classified as good. Some might consider debt with interest rates below the average return of the S&P 500 — annualized at a hair under 7% after accounting for inflation — to be good debt. Experian suggests that 8% is often considered the floor for high-interest debt, while Fidelity suggests 6% as the threshold for prioritizing repayment over increased savings. Good debts also tend to support purchases that deliver lasting, tangible value to your life. The idea here is to facilitate purchases that would otherwise be unattainable without first saving for a period of time that's genuinely unmanageable. These include things like homes or cars, while federal student loans also tend to fall into this category.

There's a general aversion to aggressively paying off things like student loans or mortgage debt because the overpayment you'll make might be better optimized as money invested for your future. Even if your interest rate is low enough to consider carrying the repayments, it may still prove beneficial to go a different route. For instance, buying a home offers an opportunity to aggressively build equity that can unlock new avenues of financial mobility. If you repay the mortgage as quickly as possible, you might then be able to leverage the property in pursuit of a second real estate purchase. This creates the opportunity for a rental property to pay off a portion of your new mortgage, eventually becoming a centerpiece in your retirement income strategy.

An annuity policy is often thought of as an investment that's less valuable than a direct investment in your own portfolio of assets. An annuity contract is likely to deliver a lower total volume of growth than a standard approach to building your savings accounts, often thanks to their fee structure. However, annuities deliver a level of certainty and security that's unmatched by direct portfolio management. When considering a policy, you'll develop a framework for how much you want to receive in retirement, and then work with a set deposit schedule to arrive at that valuation. In a way, it's a bit like a life insurance policy featuring a set benefit amount with a known monthly premium cost. Yet, an annuity contract is paid out to you, rather than your loved ones after you pass.

Annuities can be a great way to generate specific levels of retirement income. As such, those who are planning to retire early can start investing in an annuity policy early on in their working life to arrive at a predetermined target at or near their goal retirement date. As is the case with your own investment portfolio, the earlier you start, the more you'll be able to contribute. By exiting the workforce early, you'll need to develop some creative support tools to bridge the gap between your retirement date and the start of your Social Security benefits. Similarly, you'll need to consider ways to extend your cash flow for the longer duration of your retirement. An annuity contract can provide a set amount of cash coming into your budget each month.

It's been a prevailing piece of wisdom in the past to save 10% of your pre-tax income for your golden years. However, this is already a rule that baby boomers swore by that no longer works for modern savers. Instead, many experts now suggest saving at least 15% of your income. This change comes as a result of a slower uptake of pensions and other workplace retirement benefit programs. Boston College's Center for Retirement Research's analysis of data from the Bureau of Labor Statistics' Current Population Survey shows a decline in participation rates for retirement plans since 1979. Increasing economic uncertainty from other fronts is troublesome, too, such as the looming insolvency crisis within the Social Security trust fund that may fundamentally alter the amount that beneficiaries receive from the federal government.

Even with a larger percentage already established as an important update, it's still not enough for savers who plan to quit the rat race early. Saving aggressively can mean earmarking as much as 50% or more of your income for retirement savings if you're all in on the goal. As is the case with many strategies to create a rapidly thriving retirement portfolio, younger investors have the best flexibility here. If you're serious about getting out of the working life faster than the average American, you'll need to get serious about how you allocate your paycheck dollars. Significantly more than 10% or even 15% needs to flow into your retirement accounts to meet your goals years ahead of schedule.

As you prepare for retirement, it's common to rethink your housing needs and the expenses that come along with them. Plenty of homeowners will look to move to states that won't tax their Social Security checks, for instance. But early retirees won't have this specific concern to worry about just yet. While early retirement does often come with a more intense financial balancing act that can make downsizing look attractive, it's easy to underestimate how the total cost breakdown of moving can ultimately eat away at much or all of the new cash value that selling can produce.

It's also important to keep in mind that many older Americans don't want to move: A 2023 Harvard study suggests that, between 2016 and 2021, only 5% of households aged 65 and up moved. Meanwhile, those younger than 65 were over three times as likely to do so. Instead, investing in value-adding home improvement projects that improve the quality of life you experience in your existing home may be worthwhile as you near your target retirement date. Alternatively, those who haven't quite hit their savings targets but still want to leave the workforce could also consider a reverse mortgage, which allows a homeowner to extract capital from their property without having to vacate it. The eligibility age for this move is usually 62, but some institutions extend the opportunity to those as young as 55, depending on the conditions of the agreement.

The ideal age to start saving for retirement is around 25. This timeline maximizes your ability to enjoy your early adult years to the fullest without having to worry about this added financial obligation while still leaving your assets plenty of time to grow. As the average American retires at 62, starting to save at this age offers 37 years of consistent saving and compound growth. However, a hopeful retiree seeking an exit in their 50s or earlier will need to rethink their start date. As is the case with the type of work you do, getting to an early retirement is all about making as much money as you can and saving a solid bulk of that income while living frugally and minimizing distractions. Yet, a saver looking to move up their timeline has one key advantage that slips a little further away with each passing day.

Maintaining the 37-year time horizon, you can hit roughly the same target at 57 if you start saving at 20. But young people can and often do start working at 15 or 16. These are typically part-time roles outside of their school commitments, but they can still start a Roth IRA as soon as those checks start coming in and potentially enjoy some considerable tax advantages depending on their income. Moving up the start of your savings journey by these extra few years adds plenty of growth potential, even if that early start involves limited deposit volume.