Here’s something the financial industry doesn’t talk about enough: You probably won’t get to choose the day you retire.
according to 2026 retirement confidence survey From the Employee Benefit Research Institute, nearly half of people retiring in 2025 stopped working earlier than they planned. This is not a one-time mistake. For nearly three decades, about 40% to 50% of new retirees in any given year have said the same thing.
And here’s the key thing: 76% of those early retirements were not voluntary. The big reasons are exactly what you’d expect — your health deteriorates, your employer lays you out, or a family member needs full-time care.
The difference between what people plan and what actually happens is brutal. one 2018 urban institute paper found that 56% of full-time workers in their early 50s are burned out before they are ready to leave.
So if your retirement planning boils down to “I’ll just work until I’m 67 and then figure it out,” you’re playing roulette with your last paycheck.
Here are seven specific steps to take right now while you still have the advantage.
1. Create a bridge fund outside your retirement accounts
If you’re forced to retire in your late 50s or early 60s, the worst thing you can do is start tapping Social Security or your 401(k) immediately. The first permanently locks in smaller monthly checks. The second is a 10% penalty, plus income taxes, before age 59½—although the same applies if you’re forced to retire at 55 or later. IRS Rule 55 Lets you tap your current employer’s 401(k) penalty-free.
The solution: a bridge fund. That’s cash and savings you can spend in the gap between forced retirement and the age when claiming benefits actually makes sense.
A reasonable goal is two to four years of basic living expenses, kept outside your IRA or 401(k). Roth IRA contributions (not earnings) also work – you can withdraw what you’ve invested at any time tax- and penalty-free, although the Roth five-year rule may limit your earnings.
2. Maximize catch-up contributions – especially ‘super’ ones
If you are 50 years of age or older in 2026, The IRS lets you top up an extra $8,000 into your 401(k) On top of the normal $24,500 limit, plus an extra $1,100 in your IRA.
But here’s the part that most people forget. If you turn 60, 61, 62, or 63 this year, your 401(k) “super catch-up” increases to $11,250 — and it’s only available for those four years. Once you reach 64, it’s back to regular catch-up.
If your plan offers it (not everyone does – ask HR), this window is the single largest tax-advantaged savings opportunity left in the US retirement code. Don’t let it close without using it.
3. Lock in long-term care insurance in your 50s
Long-term care is the biggest threat to forced early retirement. If you’re suddenly out of work because you or your spouse requires full-time care, your savings are quickly depleted.
The window to purchase traditional long-term care insurance is closing faster than people realize. Premiums increase significantly beginning in your 60s, and you may be denied coverage altogether if you’ve developed certain conditions.
The mid-50s to early 60s is the sweet spot. We covered this in detail in “Here’s who really needs long-term care insurance – and when to buy it.”
If you want to see what this type of insurance might cost, Money.com has compiled a list of the best long-term care insurance companies.
4. Solve the health insurance gap before you need it
Medicare doesn’t start before age 65. If you’re forced to retire at age 60, you’re faced with five years of full-stock health insurance — and ACA Marketplace plans for that age range can run $800 to $1,200 per month without subsidies.
Three things to do now: Get a maxed out Health Savings Account (HSA) if you’re eligible, as it’s the single best account in the tax code for this exact problem; Understand how ACA subsidies work based on income; And find out if your spouse’s employer plan can keep you covered.
For more information, see “9 Ways to Cover Health Care Costs for Early Retirement.”
5. Delay Social Security as long as possible
If you start Social Security at age 62 — the lowest possible age — you’ll take a permanent reduction of up to 30% compared to your full retirement age benefit. Wait until 70, and the check will be 75% larger than the one you get at 62.
The difference compared to a typical retirement could be as much as six figures. See the math in “How claiming Social Security early could give you a $100,000 benefit.”
If the forced retirement gets too hard to wait, that’s exactly what your bridge fund is for (see number 1). Spend cash, delay claims, win the long game.
6. Diversify your bucket – Roth, taxable and pretax
Most workers have one bucket: a pretax 401(k). This is a problem if you retire early, because every dollar you withdraw comes out as ordinary income. Additionally, if you’re under 55 when you leave your job, you’ll face a 10% penalty in addition to taxes — although, as noted above, the Rule of 55 can eliminate that penalty if you’re laid off at 55 or later.
A better setup is to have three buckets working together. Your pretax 401(k) or traditional IRA handles long-term growth. A Roth IRA gives you tax-free withdrawals later – as well as penalty-free access to your contributions earlier. And a regular taxable brokerage account offers total flexibility, with only profits being taxed.
When the pink slip comes, you want options. Three buckets give you options. Nobody does.
7. Prepare Plan B income before you need it
The most brutal finding in the EBRI data: Employees keep telling researchers they would work longer if savings were reduced. But the survey shows that the plan to “work longer” failed for nearly half of retirees.
So have a Plan B that is not dependent on your current employer. Now create an extra income – consulting, freelancing, a specific skill you can hire – while you’re still working full-time. Need ideas? Get started with these low-stress activities for soon-to-be retirees. Think of it like an insurance policy that you’ll never need it.
If you are pushed to 58, you will have a soft landing instead of free fall. And if you don’t? You’ll retire richer.
bottom line
Retirement isn’t a date you mark on a calendar – it’s an event that often happens to you, not to you. The problem isn’t to over-plan for the retirement you want. This is planning for the retirement you may be forced to do.
Do these seven things in your 40s, 50s, or even early 60s, and you’ll join the small minority who actually retire on their own terms.