15 Reasons an Early Retirement May Not Be Possible for You

Some people dream of retiring early. But thinking of early retirement and making it a reality are two very different things. Here are a few reasons you may not manage to retire early -- even if it's something you're interested in.

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It's possible to catch up on retirement savings even if you let many years go by without contributing to your nest egg. But there may come a point where you're just plain out of time to catch up. If you're in your 50s with pretty much no money socked away, then your chances of early retirement are pretty slim.

Maybe you have been putting money aside for retirement consistently through the years. But if that money doesn't grow at a fast enough pace, you might have to put in more time in the workforce. And if you refuse to invest in stocks and insist on focusing your portfolio on bonds, you might land in that boat.

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If you limit your investments to a few market segments, your portfolio might take a hit during a downturn. And that hit might be difficult to recover from. It's important to branch out in your portfolio, because not diversifying could ruin your chances of early retirement.

The less tax you pay throughout your career, the more money you can save for the future. But if you aren't maxing out IRAs, 401(k)s, and health savings accounts, you're missing a key opportunity. And that could spell the difference between early retirement or not.

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It's important to establish a long-term financial plan that sets you on a path to meeting your goals. This is something you can do alone or with the help of a financial advisor. But if you aren't anchored by a plan, you may not manage to leave the workforce at a relatively young age.

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The more money you spend on debt payments, the less likely you'll be to retire early. Credit card debt can be especially detrimental, as it can come with hefty interest. But an excessive amount of mortgage debt could also stop you from meeting that goal.

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If you have adult children whose bills you help pay, the money you give them is money you can't save and invest yourself. And that could mean sentencing yourself to more years in the workforce. It's one thing to help out a grown child who's fallen on hard times, but flat out paying your adult children's bills could seriously hinder your own goals.

If you haven't saved a lot for retirement, you may end up heavily reliant on Social Security. And if those benefits are expected to be your main source of income, then early retirement may be off the table. Not only can you not claim Social Security until age 62, but filing at that age will reduce your benefits. You may need to work until later on in your 60s so you can file later and avoid a hit to that income stream.

ALSO READ: 3 Reasons Claiming Social Security at Age 62 Is a Bad Idea

Medicare eligibility doesn't begin until age 65. But if you can't imagine yourself paying for private health insurance, then early retirement may be difficult. That's because you'll need some type of coverage, and once your workplace insurance goes away, you may end up stuck.

One of the most important things you can do as a retiree is budget carefully. If you're admittedly not good at following a budget, then early retirement could be disastrous for you. It's important to be honest with yourself about your willingness to budget when making your choice.

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These days, a lot of employers have done away with pensions. But some still offer them as a major benefit. If your pension provides higher benefits for working longer, then you may feel compelled to keep plugging away at your job so as to maximize that income stream.

You can't take a penalty-free IRA or 401(k) withdrawal until you turn 59 1/2. If you have all of your long-term savings in one of these plans, then early retirement may not be possible -- assuming, of course, that early retirement to you means leaving the workforce before age 59 1/2. On the other hand, retiring early at, say, age 60 may be possible.

ALSO READ: 3 Reasons to Keep Your Retirement Savings Outside a Retirement Account

If you're the sort of person who doesn't do well with downtime, then you may not want to retire early. If you don't have a job to go to, you might easily get bored -- and depressed. Just as significantly, you might end up rapidly spending down your nest egg to stay occupied -- and risk running out of money in your lifetime.

It's important to have a plan and vision going into retirement. If that's not something you're able to focus on, then you may be better off sticking with your job and retiring at a later age. You don't want to leave the workforce only to find yourself at a loss for how to fill your days.

ALSO READ: Bored in Retirement? 4 Ways to Fill Your Days and Make Money at the Same Time

If you're in great health, and your parents and grandparents have all lived long lives, then retiring early poses a risk to you -- that you'll outlive your savings. To be clear, living many years is a good problem to have. But from a financial standpoint, you may be better off retiring on time or even on the later side if you expect to live well into your 90s or beyond.

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The idea of early retirement might appeal to you. But the circumstances have to be right for you to pull it off. If that's not the case, worry not. Americans are living longer on a whole these days, so even if you end up working until your later 60s or early 70s, you might still have many years of leisure ahead of you to enjoy.

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