Personal Financevadimgouida from Getty Images Pro and ansonsaw from Getty Images SignatureMaurie Backman
The decision to retire early is not an easy one.
You may run into challenges in the context of healthcare and accessing your money.
There’s also the mental and emotional impact of retirement to consider when you’re fairly young.
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A lot of people have the goal of retiring early — as early as age 50, in fact. But without a nice-sized nest egg, that’s a tough thing to pull off.This Reddit poster is in a different boat, though. They’re 49 years old with a $9.4 million net worth. Of that, only $1.8 million comes from equity in their primary residence, which means that the bulk of that $9.4 million is money they can use to live on should they decide to bring their career to a close.The poster is wondering if they’ve saved enough to retire. And I think the general answer is yes, they can retire now if they want to. But they may face some challenges that they’ll need to consider.The problem with retiring around age 50With a large enough amount of wealth, you can make a retirement at age 50 work — especially if you’re able to reduce some of your expenses. A good number of people who end up with a large net worth by age 50 get there by having high-paying jobs. And often, it’s necessary to reside in areas with a very high cost of living to get access to those generous paychecks.But the poster here has the opportunity to move to a less expensive area in a few years, once their last child graduates high school. And that could lower their living costs substantially.Even if not, when we subtract the poster’s home equity, they still have about $7.5 million to work with. A conservative 3% withdrawal rate from their savings amounts to $225,000 of annual income.The question, though, is whether the poster here has access to those assets right away. If the majority are in an IRA or 401(k), there are early withdrawal penalties to think about. But if a good portion of those assets is in a taxable brokerage account, that’s not a concern. The poster can tap their non-tax-advantaged accounts first until they turn 59 ½, and can get at their IRA or 401(k) funds penalty-free.There’s also healthcare to think about. Medicare eligibility generally doesn’t start until age 65. The poster here will need to factor the cost of health insurance into their budget. But given the amount of money they have, that should be doable.Retirement can have an emotional impactThe poster here clearly needs some reassurance that they have enough money to retir