Editor’s note: Retire Early in 2026 is part of an ongoing series on how to retire early and the FIRE (Financial Independence, Retire Early) movement. Part one is How to Retire Early in Six Steps. To see all early retirement articles, jump to the end.
It’s said that waiting for the right moment is just procrastination in disguise. What if, then, 2026 is the year you stop striving for early retirement and start living it?
Retiring before 62, or even by 55, is an exciting but daunting goal, as many traditional benefits aren’t there to catch you yet. How do you access retirement accounts without penalties? Will you have enough income without Social Security? What’s your plan for health coverage?
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Retire early in 2026
Unfortunately, there’s no Goldilocks moment in this story. You have to trust the work you’ve already done — whether it’s saving half your income, living modestly or building multiple streams of income. As self-help author Napoleon Hill put it: “Don’t wait. The time will never be just right.”
If you’re done waiting but aren’t sure what final steps to take, this monthly early retirement checklist is for you. By January 1, 2026, you can ceremoniously update your LinkedIn profile headline to include one very satisfying word: “former.”
January: review your retirement readiness
Since this year’s resolution is greater than dropping a few pounds, there’s no time to waste. Brett Spencer, CFP® and founder of Impact Financial advises, “Retirement planning can be overwhelming, especially dealing with nuances of early retirement. Just like a new year’s workout program, getting started is key.”
Here’s what to tackle first so your goal doesn’t collect dust like an unused gym membership.
Assess your target: How much do you need? The Rule of 25 offers a simple formula: multiply your annual estimated retirement expenses by 25. This provides a target number that could allow you to withdraw 4% annually while preserving your nest egg. For greater accuracy, try our retirement calculator.
Build a budget: Include essentials like housing and food, plus fun stuff like travel. Recognizing many high-income workers in the FIRE (financial independence, retire early) movement, WorthPointe partner and CFP® John Chapman says, “High earners may not need to budget while working, but in early retirement, it’s a must.”
Get a plan and run projections: A financial adviser can stress-test your plan for worst-case scenarios, ensuring your money outlasts you — not the other way around.
February: build a health care plan
Instead of your sweetheart, focus on your own heart this year — literally. Medicare doesn’t kick in until 65, so healthcare is often a major planning hurdle for early retirees.
Explore options: Look into COBRA, ACA marketplace plans or joining a spouse’s plan. Among these, enrolling in a spouse’s plan often proves most cost-effective, providing a bridge to Medicare eligibility. Chapman notes, “Premiums depend on income, so understanding coverage is critical.” Remember that you can also use funds in a health savings account (HSA) when you retire.
Schedule checkups: Knock out physicals, dental visits and specialist appointments while you’ve got coverage.
March: organize your financial accounts
Madness is for basketball, not your finances. This month, simplify.
Consider consolidating accounts: It may make sense to combine investment and retirement accounts for easier management.
Pay off high-interest debt: “Eliminating debt, including your mortgage, lowers fixed costs and adds peace of mind,” Chapman says. Try some of our tips for how to pay off credit card debt.
Build cash reserves: Save 6-12 months of expenses in a high-yield savings account. “Since early retirees may not access retirement accounts without penalties, it’s important to hold at least a year’s worth of expenses in cash reserves,” Chapman adds. “Also, build up significant non-retirement investments to fund spending before tapping into retirement accounts.”
April: maximize tax opportunities
This is the rare year when tax season brings joy. Spencer says, “Beyond filing, it’s a great time to take advantage of any tax benefits and plan for the year ahead.”
Boost retirement accounts: For instance, you can max out 2024 IRA contributions by April 15, 2025. Spencer also recommends “maximizing 401(k) contributions and consider contributing to an HSA or FSA for additional tax deductions.”
Consider Roth conversions: “Once you retire early, your taxable income may drop significantly,” Chapman says. This creates a great opportunity for Roth conversions — transferring funds from pre-tax IRAs to Roth IRAs at potentially lower tax rates. He suggests consulting a tax adviser to determine the right amount to convert without triggering unintended tax consequences.
May: Optimize your withdrawal strategy
You’re not quite done with the IRS. If you’re under 59 ½, accessing retirement accounts without tax penalties takes strategy. At the same time, you’ll want to ensure your portfolio is balanced and your withdrawals can sustain your lifestyle.
Create a withdrawal strategy: Explore options like the Rule of 55 or SEPP 72(t) exceptions to tap your accounts penalty-free. Determine which accounts to draw from first (e.g., taxable accounts before IRAs) and at what rate to maintain tax efficiency and sustainability. Create an early retirement withdrawal strategy for the long haul.
Review asset allocation: Spencer emphasizes diversification to reduce downside risk: “Bonds aren’t the only diversifier. Understanding true diversification is critical.”
June: evaluate housing needs
Some things may not change: Housing is the biggest expense for retirees, just as it is for workers, according to government data. So, where do you see yourself living in retirement?
Assess your situation: Would downsizing or relocating improve your lifestyle and budget? Dreaming of a beachfront bungalow or van life? There are so many options to consider, all of which will affect your pocketbook. For example, sometimes joining a retirement community on the early side may save you money down the road if you need assisted living. On the flip side, if you’re hearty and adventurous, you might consider retiring abroad. You’ll also need to think through whether you retire in place, buy a new home or rent in retirement. Check out our list of the best places to retire in the U.S. Now’s the time to plan.
July: make lifestyle preparations
As you set off fireworks to celebrate America’s independence (and maybe annoy your neighbors), reflect on your own financial independence. What will you do? Who do you want to become? Early retirees can experience a loss of identity or purpose, especially when they feel there’s still more to contribute to the world.
Test your budget: Try living on your retirement income for a month and adjust as needed.
Explore interests: Start hobbies or volunteer work now to avoid post-retirement identity crises. Thinking of launching a business? Dip your toes in now.
August: create or review your estate plan
It’s not just for older folks. If you have assets, you need an estate plan.
Update legal docs: Refresh your will, power of attorney and healthcare directives. “Some employers offer group legal benefits,” Spencer notes. “Use them to get started on your estate planning or other legal needs before retirement.”
Verify beneficiaries: Double-check retirement accounts and life insurance policies.
September: review your progress
Cue Europe’s 1986 hit, “The Final Countdown,” because you’re in the final quarter.
Check your plan: “If you have tax or year-end strategies to implement, now’s the time,” Chapman says. “Logistics for implementing them can take weeks.”
Verify Social Security and pension details: Even if you’re years from filing, ensure records are accurate and, if you’re eligible for a pension, payout options are clear.
October: lock down insurance
Don’t let spooky surprises catch you off guard.
Confirm health coverage: Open enrollment often occurs in the fall, so now is when to finalize your post-retirement plan. “Reassess your health coverage needs for the last few months before retirement, too,” Spencer says. “If you want to get money into an HSA before retirement, this may be a good opportunity.”
Review other insurance: Ensure long-term care, life and property policies align with your needs.
November: notify your employer
This may be the easiest or hardest step, depending on your relationship with your company and coworkers.
Give your boss notice: Provide at least 60 days’ notice or longer if required. Use this time to wrap up responsibilities and plan your transition.
Use up benefits: Take advantage of any remaining vacation days, wellness funds or other perks. Alternatively, consider getting paid for any unused PTO you might have accrued.
December: finalize and celebrate
Sure, you could spend the month debating whether Die Hard is a Christmas movie (it is), but there are better ways to use this time. Now’s the moment to finalize the details so you can work on popping champagne.
Adjust tax withholding: Ensure retirement withdrawals don’t trigger surprise tax bills.
Set up disbursements: Plan your first withdrawals for January.
Celebrate: Whether it’s a trip, a party or simply savoring the satisfaction of achieving your goal, take time to mark this milestone. It can help make the transition smoother.
Even the best plans hit bumps, but with this checklist, you’ll be ready to start 2026 focused on your bucket list instead of your to-do list.
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