How to Retire 5 Years Early: The Honest Checklist

I have this conversation a lot. Someone sits down opposite me — often mid-career, doing well, tired in a way that’s crept up on them — and says some version of “I’d love to stop five years earlier than planned.” Then they ask me if that’s actually realistic.

The honest answer is: usually, yes, with the right groundwork. But I’d be doing you a disservice if I made it sound simple. Retiring early isn’t a hack or a mindset — it’s a series of deliberate decisions, made early enough that they have time to work. So here’s the checklist I actually use with clients, without the gloss.

In short: knowing your number, closing the gap between your pensions and your State Pension age, being debt-free, and having a plan flexible enough to survive a bad few years in the markets. None of that happens by accident — it’s the product of a plan, usually put in place several years before the target retirement date itself.

The biggest thing people underestimate is the bridge. Your workplace and personal pensions can currently be accessed from age 55 (rising to 57 from 2028), but your State Pension doesn’t start until your late 60s. Retire at 60 and you may need to self-fund five, six, even seven years before the State Pension kicks in — on top of everything else your plan needs to cover.

1. Know your actual number — not a guess. Add up what you’ve already got in pensions, ISAs and other savings. Then work out what income you’ll realistically need, based on the lifestyle you want — not the minimum you’d tolerate. The Retirement Living Standards framework is a good starting point for putting a figure on “moderate” versus “comfortable.” Our own free Retirement Readiness Scorecard does the same job in a few minutes and gives you a personalised benchmark rather than a national average.

2. Work out how you’ll bridge the gap to State Pension age. This is the step people skip, and it’s the one that causes the most stress later. If you’re retiring before you can draw the State Pension, you need to know exactly which pots you’ll draw from in those years, and whether they’ll stretch that far without leaving the rest of your plan short.

3. Get rid of debt — especially your mortgage. Retiring early with a mortgage still running is possible, but it puts pressure on income you’d rather spend on living. Being debt-free by your target date is one of the single biggest levers you have, because it permanently lowers the income you need.

4. Be realistic about spending, not miserable about it. You don’t need to live on beans on toast for a decade to retire early. But it’s worth knowing which costs matter to you and which don’t — most people find they’re happy trimming the expenses that were more habit than pleasure, while ring-fencing the ones that actually make retirement feel like retirement.

5. Use pensions and ISAs efficiently, not just enthusiastically. Where you save matters as much as how much. Pension contributions benefit from tax relief but come with an access age; ISAs are more flexible but don’t attract relief on the way in. Most people aiming to retire early need a mix of both, weighted differently depending on how far off 55 (or 57) they are.

6. Model the whole retirement, not just the first year. A good cashflow plan doesn’t stop at your retirement date — it runs the numbers across your whole retirement, including the years when spending is higher (the active early years) and the years when it typically settles down. It also stress-tests what happens if markets have a poor run just as you stop working, which is one of the biggest real-world risks to an early retirement plan.

7. Decide what you’re actually retiring to. This one sounds surprising, but it really isn’t. I’ve seen people hit their number, retire, and go back to work within eighteen months — not for the money, but because they hadn’t thought through what the days would look like. An early retirement checklist that only covers the money is half a checklist.

This is the “honest” part. A few things derail early retirement plans more often than people expect:

None of these mean early retirement isn’t achievable. They mean it needs a plan robust enough to absorb a few bad surprises, rather than one that only works if everything goes right.

You don’t have to choose between full-time work and full retirement. Plenty of the people I work with move to part-time, consultancy, or a lower-pressure role for a few years before stopping altogether. It can ease the transition, reduce how much you need to have saved by your target date, and give you a trial run at what full retirement will actually feel like.

If early retirement is genuinely on your mind, the first useful step isn’t a spreadsheet — it’s an honest look at where you actually stand. Our free Retirement Readiness Scorecard takes a few minutes and gives you a personalised read on how close you are and what’s likely to close the gap fastest.

From there, if you want to go further, we can build a full income and lifestyle plan that maps your whole retirement — including that bridge to State Pension age — rather than just the first few years. If you’re a business owner, our Business Owners Support Service also covers exit and succession planning, which is often part of the early retirement picture for self-employed clients.

Retiring five years early is one of the more ambitious goals I help clients work towards — and honestly, one of the most rewarding when it comes off. It just needs a plan that’s as considered as the career that’s funding it.

To talk it through with the team at FH Manning Financial Services in Horncastle, get in touch here or take the free scorecard as a first step.

1. Is it realistic to retire 5 years early in the UK? For many people, yes — but it depends on closing the gap between your target retirement date and your State Pension age, being debt-free, and having enough saved to bridge those years. It’s rarely accidental; it’s the result of a plan put in place several years ahead.
2. How much extra do I need to save to retire 5 years early? It depends on your target lifestyle and how many years you’ll need to self-fund before your State Pension starts. As a rough guide, five extra years of retirement income — on top of your normal pension pot — is the additional amount you’re effectively funding yourself.
3. What age can I access my pension if I want to retire early? Currently 55, rising to 57 from 2028. Your State Pension is separate and starts later — check your own State Pension age on gov.uk.
4. What’s the biggest mistake people make when planning early retirement? Not planning for the “bridge” years between stopping work and their State Pension starting, and not stress-testing the plan against a poor run of investment returns early in retirement.

Claire Markham is Managing Director at FH Manning Financial Services, based in Horncastle, Lincolnshire. FH Manning Financial Services Ltd is authorised and regulated by the Financial Conduct Authority. This article is for general information only and does not constitute personalised financial advice. The value of pensions and investments can fall as well as rise, and you may get back less than you invested. Tax treatment depends on individual circumstances and may change in future.