Early Retirement Isn’t for Everyone

Early Retirement Isn't for Everyone 350Some people just aren’t cut out for early retirement. IMO, most people would choose to keep working even after they achieve financial independence. Early retirement is unconventional and scary. Why retire if things are going well? Let’s take a look at my friend for example. Jane worked hard for many years. She saved and invested since she was young and accumulated over 33x her annual expenses. At this point, she can retire early and comfortably withdraw 3% from her investment every year. That’s a safe sustainable rate and her portfolio should be able to support her lifestyle indefinitely. That’s not all. When she’s old enough (62?), she’ll receive Social Security Benefits and a pension. She doesn’t have to worry about retirement money, but she chose to continue working. This is not unusual. Personally, I think 90% of normal people would make the same choice. Only a small percentage would quit their job and retire early. Anyway, we’ll examine Jane’s personality today and see why early retirement isn’t a good fit for her.

Team player

Jane likes being part of a team. She has always been a part of some organization or another since she was in school. She was in the marching band, softball team, student government, and many other school activities. After college, she joined the Peace Corps for a few years then came back to the US and worked for a big organization. She gets along well with her coworkers, managers, and subordinates. Jane is a great employee and everyone thinks she’s a big asset to the team. In addition, she enjoys working with other people and contributing to the organization. Work gives her a lot of satisfaction. Also, work doesn’t interfere with her family life. She works 40 hours/week and spends plenty of time with her family. For Jane, there isn’t much downside to working.

External validation

External validation makes you feel good. Jane is a good employee and she gets a lot of external validation from work. I think she is a little addicted to it. That’s understandable, right? If you get endless praise for doing your job, you’ll love it too. Jane feels like she’s making a difference and work is a good environment for her.

I also enjoyed external validation when I was young. However, the external validation in my engineering career came at a high cost. I worked 60-80 hours per week and competed with extremely smart coworkers in a toxic work environment. It was too stressful and I was burned out after about 10 years. Slowly, I grew disengaged and external validation became meaningless. In my case, the price of external validation was too high. For Jane, it isn’t. She puts in reasonable hours and receives excellent performance reviews every year. It feels good and doesn’t cause any problem for her.


Jane lives a conventional lifestyle and it works out very well for her. When she was young, she lived in one city and didn’t move until she left for college. She graduated from college after 4 years. Now, she works for a big organization and she’s on track for raises/promotions every year. She has a happy marriage and a son. Her life is charmed and uneventful. Jane doesn’t have to think outside the box because the conventional lifestyle served her extremely well.

In contrast, I didn’t have a conventional life. My parents moved around every few years when I was young and I never felt rooted. My parents immigrated to the US from Thailand when I was 12 and we faced a lot of adversity. I worked at their restaurant when I was in high school and didn’t have much time for other stuff. College was difficult for me and money was always a big issue. I worked a conventional job for a while, but I chafed at it. Back then, a conventional lifestyle meant work long hours, live in a nice big house, drive a convertible BMW, go out to expensive places, and being miserable a lot of time. I had all that and I didn’t like it so I had to figure out an alternative.

Status conscious

Jane works in HR/middle management. She likes the status. When someone asks her what she does, she can answer with pride. This status will disappear if she retires early. A lot of people’s identities are closely tied up with their profession. They identify as a manager, doctor, lawyer, engineer, or whatever. The job brings a lot of pride. It feels nice and normal to be somebody. When you retire, you no longer feel important and other people think you are inconsequential.

I left my engineering career 8 years ago and I’m still uncomfortable when someone asks me what I do. People judge you by your job. It’s an easy way to rank someone. I used to tell people that I’m retired, but that’s uncomfortable because I’m still pretty young. I know they’re thinking – “you’re a bum.” Now, I tell them I work from home. Like it or not, people are judgy.

Change and uncertainty

Jane dislikes changes. She doesn’t like to move. She doesn’t like to buy a new car. Basically, she thinks life is good so why change it? This mentality is actually really good. She’s satisfied with life so the grass isn’t greener on the other side. She’s happy with her life. However, this is incompatible with early retirement. Her job is good. There is no reason to retire early when she’s already happy.

Jane also hates uncertainty. Early retirement is full of uncertainties. I retired from my engineering career when I was 38. I could be in retirement for 50 years or more. A lot can happen in 10 years, let alone 50. Our spending is under control, but nobody knows if that will change. We don’t know if our portfolio will really hold up for 50+ years. Early retirement is full of uncertainty. You just have to take a chance and leap. This is too much for a lot of people. Most of us like the certainty of a steady paycheck.

Type A personality

Jane is Type A. She likes getting things done. Well, she’s not 100% Type A. I think maybe 70% type A and 30% type B. However, that’s enough. Type A people thrive in a structured working environment. They enjoy the competition and camaraderie. Work gives them a set of goals so they can strive to finish them one by one. Structured work is a good environment for this personality.

I’m much less competitive and have a Type B personality. Early retirement is a great fit for me. I love the unstructuredness of it all. I can do things at my own speed without any stress. The freedom is awesome.

I think Type A people will have a harder time with the retirement transition. They probably need to figure out some new goals so they can strive toward them. It’s hard for them to relax.


As you can probably guess, Jane is a stand-in for Mrs. RB40. She continues to resist early retirement even when our finances can support it. That’s why we changed our goal. Now, we plan for her to take a year off in 2022. We’ll see how the preview goes and then we’ll figure out the rest later. If she doesn’t like it, she can go back to work. If she enjoys it, then maybe she can stay retired. She is mellowing out with age so maybe she’ll be a good fit for early retirement soon.

Do you know anyone who might not be a good fit for early retirement? 

One way to help convince your partner to FIRE is to show them the numbers. Here is a great tool for individual investors – the Retirement Planner at Personal Capital. It is the best retirement calculator out there. It’s even flexible enough for early retirement. Sign up with Personal Capital and check it out.

Image credit: Isaiah Rustad

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Joe started Retire by 40 in 2010 to figure out how to retire early. He spent 16 years working in computer design and enjoyed the technical work immensely. However, the job became too stressful and Joe retired from his engineering career to become a stay-at-home dad/blogger at 38. Today, he blogs about financial independence, early retirement, investing, and living a frugal lifestyle.

Passive income is the key to early retirement. This year, Joe is increasing his investment in real estate with CrowdStreet. He can invest in projects across the U.S. and diversify his real estate portfolio. There are many interesting projects available so sign up and check them out.

Joe also highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help DIY investors analyze their portfolio and plan for retirement.

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Originally posted at https://retireby40.org/early-retirement-isnt-for-everyone/

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