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Choosing to retire early is a far-off dream for many hard-working Americans. In fact, it’s more like a fantasy for the one in two who told Allianz they’d retire immediately if they won a lottery (1).
Most workers plan to work straight through to 65 or beyond. Suze Orman says that’s admirable.
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“Working longer can make great sense,” she wrote in a recent blog post (2). “You can keep your retirement savings growing longer, tap into less earlier, and perhaps even continue to save more.”
But she warns it’s also a risky strategy. While you may not choose to retire early, you may be forced to — through restructuring, an unexpected health diagnosis or family circumstances.
Orman cites an Employee Benefit Research Institute (EBRI) 2026 Retirement Confidence Survey that found that while most people plan to retire at 65, the median retirement age is 62.
She — and Craig Copeland, EBRI’s Director of Wealth Benefits Research — have some tips on how to prepare.
How to prepare for an involuntary early retirement
Moneywise reached out to Copeland to learn about the disconnect between expectations and reality.
EBRI has been conducting retirement surveys since 1990, and the findings are consistent, with a significant number of Americans forced into early retirement — up to 50% this year. Still, most Americans don’t think it will happen to them.
“It happens to one in two people, but most people think they’re going to be the one to work longer,” Copeland told Moneywise.
When it comes to a forced retirement, the first step is being mentally prepared. Like Orman, Copeland warns that people who think they can work to 65 or beyond make risky assumptions about:
- How much they can save before they retire.
- How much they’ll collect in monthly Social Security benefits (which increase the longer you delay collecting them from 67 through 70) (3).
- How much Medicare and Medicaid health insurance they qualify for.
His advice? “Don’t fix your plan on one retirement date,” he said.
If you’re already running financial scenarios about retiring at 65 or 67, he suggested pushing that back to include scenarios for an early retirement at 60 or 62 (whether you want to or fear you may be forced to). Working with a financial advisor would make this easier.
“Think about different investment strategies, the cost of getting health insurance when you’re younger,” he said. “You may have to make harder decisions — cut back, downsize a house.”
That’s where Suze Orman’s tips come in.
“It is great to aim to work longer, but I want you to consider how you can get your finances in great shape so that if you do need or want to retire earlier, you will be secure,” she wrote.
Pay off your mortgage, preferably before retirement
“This is one of the most powerful things you can do to reduce what retirement actually costs,” she wrote, noting that having shelter paid for dramatically reduces monthly expenses.
“That gives your savings more room to breathe and reduces the pressure on Social Security to cover everything.”
Get aggressive about saving in your 50s
Orman noted that anyone 50 or older can make significant catch-up contributions to retirement savings plans without an IRS penalty. For example, in 2026, those who are 50-plus can contribute as much as $32,500 to a 401(k) without a penalty. Those aged 60 to 63 can contribute a whopping $35,750 to a 401(k) — or $8,600 toward an IRA.
What to do if you’ve been forced into retirement
Not everyone has a house — let alone a mortgage to pay off — or the option to max out retirement savings plans. This can make forced retirement more stressful.
“If you’re 62 with limited resources, it doesn’t give you a lot of flexibility,” Copeland said, adding that such retirees don’t yet qualify for Medicare.
AARP notes that people in this situation may qualify for insurance on their spouse’s plan (4). Alternatively, they might qualify for federal COBRA (Consolidated Omnibus Budget Reconciliation Act) health insurance — extending their former workplace coverage (5). But it’s pricey.
When it comes to cash flow, experts advise against claiming Social Security early unless you have a condition that shortens your life expectancy (6). Instead, AARP suggests investing severance money into low-risk certificates of deposit (CDs) that earn some interest.
No one wants to be forced into retirement, but with enough planning, you can regain a bit of control if it happens to you.
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Allianzlife (1); Suzeorman (2); Ssa (3); Aarp (4), (6); Dol (5)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
