Be thorough before you make the leap into retirement.

There are some exceptional individuals who have successfully retired early by being financially savvy, planning meticulously, and perhaps a touch of luck. However, early retirement isn’t without its challenges, particularly due to hidden costs that could disrupt your plans.

One significant cost to consider is health insurance. While you may currently receive health insurance through your employer at little to no cost, once you retire, you’ll have to cover these expenses yourself until you’re eligible for Medicare at 65. Depending on your health and tax credit eligibility, this could become a significant out-of-pocket expense.

Another sneaky expense could arise from outstanding debts on major purchases like cars or homes. It’s crucial to clear any existing debts before retiring, as ongoing debt payments with no income source can derail your retirement plans. If you anticipate accumulating debt in the future, it may not be the right time to retire.

Living within or below your means is paramount in retirement planning. It requires careful financial calculations to ensure you have enough savings or investments to sustain your essential expenses. Planning for unforeseen circumstances is also essential, given the unpredictable nature of the global economy in the long term.