Early Retirement - Financial Freedom (Investing, Tax Planning, Retirement Strategy, Personal Finance)

5 Surprising Statistics That Will Make You Want To Retire Early

• Ari Taublieb, CFP®, MBA • Episode 266

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Ready to feel more motivated about retiring early? These five research-backed stats reveal how early retirement can positively impact everything from health to relationships—and might be the nudge you need to take your financial independence plan more seriously. The benefits go well beyond just having more free time.

While many people delay retirement out of fear or uncertainty, the data shows that stepping away from work earlier can lead to greater satisfaction, improved well-being, and more meaningful use of time. But getting the timing right means understanding your financial picture and knowing when enough is truly enough.

Early retirement isn’t about escaping work, it’s about creating space for the things that matter most. If you're serious about building a life with more energy, freedom, and fulfillment, this is your sign to start planning intentionally.

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Advisory services are offered through Root Financial Partners, LLC, an SEC-registered investment adviser. This content is intended for informational and educational purposes only and should not be considered personalized investment, tax, or legal advice. Viewing this content does not create an advisory relationship. We do not provide tax preparation or legal services. Always consult an investment, tax or legal professional regarding your specific situation.

The strategies, case studies, and examples discussed may not be suitable for everyone. They are hypothetical and for illustrative and educational purposes only. They do not reflect actual client results and are not guarantees of future performance. All investments involve risk, including the potential loss of principal.

Comments reflect the views of individual users and do not necessarily represent the views of Root Financial. They are not verified, may not be accurate, and should not be considered testimonials or endorsements

Participation in the Retirement Planning Academy or Early Retirement Academy does not create an advisory relationship with Root Financial. These programs are educational in nature and are not a substitute for personalized financial advice. Advisory services are offered only under a written agreement with Root Financial.

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Ari Taublieb, CFP ®, MBA is the Chief Growth Officer of Root Financial Partners and a Fiduciary Financial Planner specializing in helping clients retire early with confidence.


Speaker 1:

Most of you do not need a pep talk or a motivational speech from me to tell you the benefits of retiring early. You want to retire early. You want to spend more time on what you care about most. There are some statistics that might surprise you, though. So if there was any more motivation you needed, this hopefully will be insightful for you, to give you some more firepower, so that every time you add more money to your 401k or to your Roth IRA or to your superhero account, which is what I call a brokerage account you know exactly why you're doing it. So this is less of an episode of hey, I'm gonna learn a really specific tactic and I'm gonna go save 10% of taxes on my future year's earnings. That's not what this is. These are just some statistics that I have gathered from my research, in addition to take in from my clients who have actually retired. Now a quick story before we hop into the five statistics. When it comes to an early retirement, there are a lot of people who are really excited to retire, but they're also hesitant to spend in the early years of retirement because they're worried if they overspend from, let's call it, 55 to 60, which I call an early retirement anytime before 65. So if they overspend from 55 to 60, that they're going to be 80 regretting and wishing they had more money. At the same time they have another thought in their head of hey, I don't want to be 80 with $7 million. I wish I would have spent more when I had my energy and my health. So, in a weird way, there are a lot of people that I talked to who are on track for retirement I'm going to say it again, on track for retirement, who I don't advise retire and you're like that doesn't make any sense. You can be on track for retirement, which means lifetime income from, let's call it, 65 to 95. But it doesn't mean you should retire if you have not really dreamt of what you want those early years of retirement to look like. If you want to spend, hypothetically, $100,000 a year, after taxes, adjusted for inflation, for the rest of your life, you, if you're following the right rules, if you want to use the withdrawal approach I use, which is called John Guyton's guardrails approach, where you shift income based off of market conditions, what happens is you start at $2 million. 5% of 2 million is a hundred thousand a year. So if you had $2 million and you wanted to retire early and you were hypothetically 55 going, I'm ready to walk away. It doesn't necessarily mean you should.

Speaker 1:

Now I'm the first person to ask someone hey, do you want to retire early? Are you in a good spot? I want you to prioritize health, family, friends, travel, all the good stuff, but I don't want you to retire too late and be mad at me because you wish that you had spent more along the way. I don't want you to run out of money and retire too early. There's balance there. Why do I bring this up?

Speaker 1:

I really do not want you to retire too early and have to go back to work, and I have seen that where people retire at 55. They're like I'm going to spend a hundred thousand a year. Wait a second. Kids college just came up. Yep, that's a significant expense. And I thought they were going to get a scholarship. It turns out my child isn't investing to the degree. Get a scholarship Turns out my child isn't investing to the degree I hope they would.

Speaker 1:

I want to give them more money for their Roth IRA or I want to help with a down payment or a wedding, so that 100,000 a year just became 150,000 a year, which just became 175,000 a year because of healthcare and extra travel. And when you're not working you have more time to spend money. So maybe 100,000 is the reality of what your base expenses are, but you have way more things that come up in the early years of retirement, which now you have a lot of pressure on your portfolio. Imagine you retire at 55 and now all of a sudden markets go down and your 2 million is worth 1.8 and you want to take let's call it $175,000 so that you can exist. Well, if you do that, that would be a 9.7% withdrawal rate. That's way too high. $175,000 out of $1.8 million. That is something that would make me uncomfortable as an advisor.

Speaker 1:

So I'm bringing this up not to scare you but say this is real life stuff. Does it make sense to plan for extra buffer? Yes, but I see too many people make the following mistake of I don't know when I'm going to have enough. I'm going to keep working. And they keep working and keep working. And I have a phrase for that that I call goalpost planning, where you're just pushing back the goalposts, just pushing it back one more year, one more project. Then I'm going to retire. Now you're 60 and you have $3 million and you didn't need 3 million, you just needed a little bit more.

Speaker 1:

So, with that being said, here are some statistics that will hopefully make you even more excited to retire early, because retiring early is very simple, but it's not easy. It's really simple. I know what a 401k is. You probably know what a 401k is. I save more. I'll have more for retirement. That doesn't mean it's easy. There's a trade-off. Every dollar that doesn't go to your 401k could be used for a tutor for your child. It could be going to travel. It could allow you to quit your current job to go start another career. That sounds way more exciting, even if it pays less. Every dollar has a trade-off. Now I am a certified financial planner. I'm the host of the Early Retirement Podcast, and I love what I get to do, which is I get to help people retire early and understand truly when work is optional so they can spend more time on what they care about most. So I'm going to go through these statistics now. All I ask tell me which one is the most surprising.

Speaker 1:

I love hearing from you guys. If you're listening on the podcast app beautiful, send me an email. You can literally email me and my team, ari at rootfinancialcom. That's ari at rootfinancialcom. That could be regarding this episode, that could be regarding working with us, that could be whatever you want.

Speaker 1:

I love hearing from you guys. So if you've been listening for a year or more and you just go, hey, I just want to say thanks for all the work, or you know what? You talk way too fast and your stories are going on and on and you just really got to condense what you're doing. Guys, this show is for you. I tweak all the feedback. So, as you notice the show shifts, that's because of things you're telling me. One of you sent me a very transparent note, which I love, saying hey, ari, I don't want to be mean here or anything, but sometimes that you'll say, hey, I'm starting to tell a story and you'll get so excited during that story that you'll tell another story and forget the main story and it's really making us confused and I'll say, oh my gosh, that's the last thing I want to do. Let me understand. So, for those of you guys who are thinking, hey, the show has gotten worse or gotten better or shifting, I'm shifting everything based off your feedback.

Speaker 1:

You have not seen the amount of times I will practice making these episodes where there is not a record button on the camera, and I even love getting to do that. Sometimes I'll even record those and I'll post them just to show not, hey, I'm practicing, but to show you guys. Hey, there was one thought I think I explained really well there while practicing it. I'll take that clip and I'll send that out as a clip so you don't have to see the whole thing. But you get a little tidbit and some of you go it's that one tidbit that click's it. Let's hop into it. So the first statistic Now this was from a 2020 study in Frontiers in Psychology creativity peaks after leaving work.

Speaker 1:

Just think about this for a second. Okay, creativity peaks after leaving work. It's a cliche saying, but a lot of people say if you need a new idea, go into the shower or whatever it is that brings you creative thinking. Go on a walk. I find myself I get my best ideas when I'm in savasana or shavasana I think it's shavasana of yoga. At the end I'm not asleep, but I'm kind of in like a dazed state and I'll get ideas that just come to me. I don't know why, but sometimes I'll go to yoga and I'm doing all the exercises and breathing and then I'm thinking at the end I really need a good idea. And if I try to go I need a good idea, I never get that. It's only when I'm in total bliss I'll get an idea that, just like floats to me, I go what a magical thing, what a cool brain that I can just do that.

Speaker 1:

And this is the same concept that you guys. There are creative thoughts that you're probably just not receiving because you're working so hard, you're saving so well, you're working to the nth degree so that you can retire early one day. You're busy with kids and life and I get it. The reason I'm bringing this up is that's not why you should retire early, but some of you want to write when you retire. Many of you have shared in our free community, the Root Collective hey, I'm going to spend more time volunteering, but I'm going to spend more time writing and reading and maybe I'm just going to kind of see what comes to me. Awesome.

Speaker 1:

You can literally see in this study retirees who left work before 60 reported a 33% increase in creative engagement writing, art, music compared to those who continued working. Now is that a no-brainer? No, it doesn't apply to every single person, but it's a cool thought to go that wow, what if you could get more creative when you're not working? I've seen this my fiance Alice. She's a teacher. She has summers off. When summers are off and she's reading, she's more creative. Her jokes are better. If she heard this, she'd go my jokes are great all the time. But she is literally a funnier person when she's not working, because she might say a joke but actually is thinking about I got to plan that lesson for tomorrow. Might say a joke but actually is thinking about I got to plan that lesson for tomorrow. So it's something to consider. The next one Early retirees, of course, are more likely to volunteer, but that's not the reason to only do it, although that's very nice Live longer.

Speaker 1:

People who retire before age 60, according to a 2013 Carnegie Mellon study, before age 60 are 40% more likely to engage in regular volunteer work, which has been associated with a 24% reduction in mortality risk. Don't let that statistic be the reason you go retire early. Some of you are like, oh my gosh, that's going to save me. I got to go retire. Don't do that. Okay, volunteer because you want to volunteer, but know if you volunteer and you do live longer because you enjoy life and there's purpose and fulfillment.

Speaker 1:

A lot of people retire and just don't know what they're going to do, and so they start to find their health decreases because they don't have motivation and they're not creative anymore. They're not using that muscle which, yes, as you know, you need to be honest. Okay, this was in the journals of Gerontology found that early retirees report a 17% boost in relationship satisfaction, especially among men who retire before their spouses. Okay, this I struggle with, because a lot of people are very close although they don't think so in the moment with their coworkers. Then they retire and they're not hanging out with their coworkers because there's not activation energy. You don't have to plan it with your coworker. You know you're going to see them at the meeting, you know you'll see them on Zoom, you know that you might just run into them at the quarterly meeting and there is a sense of connection there.

Speaker 1:

When that stops and you have to now be the initiator, there are a lot of people who struggle with that community sense and so it can be weird to, after you retire, if your coworker is still working, to go hey, can we go to lunch? They're like I'm working, so what I have clients do is I have asked them. I go hey, there's a few coworkers you've told me about. They sound really cool. I encourage you to invite them to lunch. Don't do it in like a debilitating way where it's hey, I retired and you didn't Just say hey, I really would love to connect. I feel like we used to get to see each other way more. I'd love to take you to lunch and say it like that. So there's a very clear who's paying. And I have clients that are really grateful that I brought up that idea, because now they're seeing coworkers they otherwise wouldn't have and they are planning financially for that as a expense that's worth paying for of hey, I'm going to pay to be able to hang out with my friend.

Speaker 1:

I talk about this a lot, but I have a friend that I love. He's one of my closest friends. He does not make a lot of money. I love going on vacation with him. I will pay for him to come on vacation. I don't expect anything in return. He doesn't act a certain way. Now, if he were the type of person that would act weird because I'm paying, then I would never do it because it would make it too weird on the trip. But it is not that type of relationship and it's not that I have so much money I can pay for his trip. What I'll do is, if I'm buying a plane ticket, I'll buy his ticket and go hey, I bought it, you're now coming. I'm not paying for every single thing, but it's initiating that and sometimes not all the time he will go hey, man had a good month. I got this bonus from selling this. I'm happy to pay you back for this because our relationship is that good. I'm not concerned on whether he does it or not and I'm confident if he has the money he will pay me back. But imagine I didn't pay for it. Well, do you know how many experiences I would lose with my friend? It's not worth it to me.

Speaker 1:

The fourth one here retiring early may improve sleep by up to 50, five zero minutes per night. Research from the University of Turku showed retirees, especially early retirees, get an average of 46 to 50 minutes more of sleep per night, improving cognitive function, emotional resilience. Now I've seen that go the other way. Where people stay up late, they're having more fun, they don't have to go to bed, they're drinking more wine, they're doing whatever it is they're doing. So this is not like a hard and set rule, but I thought it was interesting. And then the final one, which is my favorite.

Speaker 1:

This is a survey by Age Wave and Merrill Lynch found that only 8% of early retirees now early retirees, they are saying is before age 55, reported significant regrets about retiring, compared to 32% of late retirees after what they said age 67. So what they're saying here is 8% of early retirees regretted it, versus 32% of late retirees regretted it. Now here's where this is confusing the people who are retiring later. They likely are regretting it because they just had to work longer. If both people had the option of retiring early, I bet they would equally enjoy it.

Speaker 1:

But I didn't go to the nth degree when reading the study. What I found interesting is that 8% number 8% very few people retired at 55 and went oh, I should have kept working. Even if financially they were in a position where it was tight, they still were grateful they made that decision. Maybe they did part-time income, maybe they were planning on working until 60, retired at 55, making an assumption here and then just said you know what? I'd rather spend less money If that means I don't have to go back to work. That's more important to me. They might go I'm going to downsize or that inheritance I wasn't planning on. I went and had a conversation that I would have never had with my parents to see if that's something, realistically, I could count on. And I've had clients who retired early in a comfortable position now because they have time and they are comfortable with their decision retiring.

Speaker 1:

Go speak to their parents and say hey guys, I want to make sure you're enjoying your retirement to the fullest. But it would be more helpful today if I were to receive more money than inheriting it in the future as a big lump sum because I have kids in college. I have kids that want to hang out with you guys. Don't even spend it on me. Take us all out to dinners, pay for more family trips. I value that way more than inheriting $800,000 in 15 years. Like I don't want you guys to not be okay. I want to make sure you're set up for your long-term care and that you're not worried. But beyond that, if there's extra, can we have a conversation about it? That's very difficult to do and I recognize many of you go look, I don't have that relationship with my family. All good. Just wanted to give an example on this. Those are five statistics. Maybe they make you more motivated. If there was one that kind of sparked your interest, let me know in the comments below.

Speaker 1:

I love making these videos and podcasts for you guys. If you want to work with Root directly so that we can help you optimize as much as possible, well, you can go to our website, rootfinancialcom. In the upper right you'll see a little button. It says click here to see if you're a fit. It'll ask you some questions and we'll take it from there. See you guys next time.

Speaker 1:

Thank you all, as always, for listening to the Early Retirement Podcast. I love getting to host these shows and make different content for you guys every single week. I've not missed a single week in years and that is because I love getting to do this. Now, please be smart about this. Before you actually execute any strategy that you see me talk about or hear me talk about, should I say Please talk to your financial advisor, your tax preparer, your estate attorney, please be smart about this. None of this should be construed as financial advice. This is for fun, educational, informational purposes only. Once again, just quick disclaimer here. Guys, please be smart about this, appreciate you listening, as always, and you can, of course, submit a question on my website, earlyretirementpodcastcom. If you, of course, want me to address a specific case study or topic. I will not promise I can get to it, but I respond to every single person and if I find it will be helpful for a lot of people, I will absolutely make an episode on it, at the very least give you some insight. That's it, thanks, guys.