How Much Do You Need To Retire at 55?

Want to retire at 55? Will $300,000 be enough?

I talk a lot about the feasibility of semi-retirement, so let’s get into some specific examples. Let’s say your goal is to retire at 55 — still much younger than the average American retirement rate. How much is enough? To start, what would life look like if you retired from full-time work at 55 with $300,000?

We’ll look at some similar hypothetical questions, too, to adjust small variables and see how that changes the outcome.

If you’d like a convenient format to work through your own personal retirement progress, check out the free workbook!

In all of the below situations, I’d recommend meeting with a fee-based (not commission-based) financial advisor to verify before “pulling the trigger” on your retirement.

Look at Your Full Financial Picture

Is $300,000 enough? The short answer is… maybe! This is all basically a balancing act between income (or investment growth) and expenses.

Is semi-retirement an option for you, or are you planning to go full FIRE and completely stop working?

Let’s choose some assumptions so we can dig into the numbers.

Related: The 5 Best States To Retire

“Cost of Living” and Retiring Abroad

A major factor in planning your retirement expenses will be your housing and broad “cost of living” expenses. Different parts of the world can vary widely on the cost per square foot of home, food, healthcare, etc.

Many people choose to retire at 55, or other “early” ages, and move to lower cost of living countries — some even move abroad!

For this post, I’ll focus on United States averages, but remember that you could consider living abroad or somewhere less expensive within the US as an alternative.


According to a September 2019 Bureau of Labor Statistics report, the average annual expenditure per consumer was $61,224.

Let’s round to $60,000 but also look at $35,000 and $85,000 scenarios, just to compare. Perhaps you live in an area with a higher or lower cost of living than average or have particular spending behaviors you’d like to account for.

If you’re reviewing this retirement scenario for your own life, be sure to consider all of these retirement expenses to plan for. It’s always better to use your own “real” numbers than a general statistic or rule of thumb from someone who doesn’t know the details of your life.


Typically, your income will come from (1) your day-to-day work, (2) existing investments, and/or (3) fixed payments like a pension.

The daily work income variable is the main item we’ll be looking at below. Let’s assume you can earn $20 per hour doing part-time work and that you can get as many hours as you need to cover your expenses. Let’s also assume that you want to take 7 weeks off of work each year — you are retired after all. So that leaves you with 45 weeks per year to do part-time work. (You can read more about those assumptions here).

For your investments, we’re considering a portfolio of $300,000. You’ll have to be careful not to overspend, or else you could run out of money during retirement.

So, let’s use the 4% rule here to determine the income your investment portfolio can generate for you (to learn more about the 4% rule, check out this post). 4% of $300,000 comes to $12,000, so that’s a reasonable number to plan on.

Let’s assume you don’t have a pension or annuity, and since you’re 55; you won’t be receiving Social Security income yet.

So… can you retire at 55 with $300,000?

Now that we’ve established some good assumptions let’s look at the numbers for our different scenarios!

Scenario A — Lower Expenses Scenario B — Average Expenses Scenario C — Higher Expenses
Annual expenses $35,000 $60,000 $85,000
Investment income using 4% rule with $300,000 portfolio $12,000 $12,000 $12,000
Remaining expenses to cover using part-time income $23,000 $48,000 $73,000
Number of hours needed per week to achieve this income

(earning $20 per hour with 45 working weeks per year)

25.5 hours per week 53.3 hours per week 81.1 hours per week

Uh oh. 53 or 81 hours per week isn’t exactly “part-time” work, is it? These numbers don’t work out very well in 2 of our 3 scenarios.

If you have lower-than-average annual expenses, you could consider retiring at 55. Be careful though, don’t forget to consider Step 3 of retirement (when you can’t work at all anymore) or to factor in cash reserves into your retirement planning.

So to answer our question, for most people in America, retiring at 55 with $300,000 may not be viable.

But you could change the game to give yourself a more favorable outcome. You have options. You could earn more per hour doing part-time work, retire at an older age than 55, or (if you’re younger than 55 right now) save more than $300,000 while you’re preparing for your early retirement.

The good and bad news here is that it’s all just a numbers game. So if you’re still in your early- or mid-career years, you have an opportunity to set yourself up for the future by investing more now.

Let’s look at some similar questions, too.

How Can I Retire at 55 With No Money?

This will still just be a matter of balancing income, expenses, and savings later in life.

With no money invested for retirement, the income side of the equation looks challenging. The main exception will be receiving payments from the government, an annuity, a pension, or something similar. If you are, then retiring without investments could be an option!

Remember to account for insurance costs (including possible long-term care insurance) and emergency cash reserves.

If you aren’t receiving any fixed payments like those mentioned above, retiring with no money won’t likely work out until you can start collecting social security.

But remember, better late than never! Start preparing and saving for your retirement now. You still have time to save a significant amount of money to create some comfort and flexibility before you retire.

Can You Retire With $300,000?

For this question, we’re not assuming that you’re currently 55. Let’s answer this one from the perspective of retiring at any age — so we won’t assume you’re collecting Social Security payments, either.

Overall, this will put you in a similar situation to our original “Retire at 55 with $300,000” question. The one advantage to retiring earlier with $300,000 is that you may be able to buy yourself more time for your portfolio to grow.

For example, consider if you want to leave your full-time job at 45. Imagine if you can work part-time and cover your basic expenses, and you expect to stop working at 75 completely. That gives you 30 years for your $300,000 to continue growing and giving you greater flexibility once you fully retire at 75.

If we consider just an 8% growth rate compounded monthly for those 25 years, you could have over $3,000,000 for your full retirement years.

Now, can most people cover all of their expenses on a part-time income? Probably not. So some strategic planning will unlock some unique options here. Paying off your home or “house hacking” to cover your living expenses could make this option more feasible.

How Much Money Do I Need To Retire at 55?

If you fully retire at 55 with average annual expenses of $60,000, the 4% rule would give you a rough portfolio goal of $1,500,000.

Now, the good news is Social Security payments will eventually kick in. This will give you some more flexibility. One option here would be to keep your annual expenses at $60,000 plus inflation, then withdraw less from your portfolio each month so that you can build up a larger portfolio for your later retirement years.

Again, don’t forget to account for some emergency fund savings or cash reserves to protect your investments.

How Long Will $300,000 Last in Retirement?

If you decide to retire on $300,000 before your Social Security benefits kick in (for example, if you retire at 55) — how long will that money last? If we continue to use the $60,000 annual expenses, it won’t last long—only about 5 years.

If you want to use the 4% rule to find a sustainable level of expenses, your budget would only be about $12,000 per year. That might not be easy.

However, many “Lean FIRE” advocates or people who live in meager cost of living areas may find the $10,000 – $20,000 per year budget to be feasible. Even a slightly larger portfolio could make this a feasible option!

Related: Who Is the Richest Family in the World?

So, should you retire at 55?

Remember — it depends on what your own lifestyle, goals, values, and expenses are! The 4% rule is ultimately just a tool to give a rough idea of what your investment returns should look like.

Before you retire at 55, or any age, check out the free retirement planning workbook. I also recommend talking with a fee-based, fiduciary financial planner who can help you assess your specific financial picture.