Are you a member of Gen Z interested in retiring early? Fortune would like to hear from you. Email senior writer Alicia Adamczyk at alicia.adamczyk@fortune.com to share your perspective.
Baby boomers may not be retiring, but younger workers can't wait. Survey after survey finds that Gen Z is the most ambitious generation when it comes to early retirement, with some reports suggesting as much as 70% of the workforce's youngest cohort would like to permanently clock out years—or even decades—early.
But financial experts say Gen Zers who want to exit the workforce early are, to put it mildly, facing an uphill battle. While workers of all ages struggle to save enough for retirement, it may prove even more difficult for younger Americans. The costs of everything from housing to education to child care are significantly higher than for baby boomers and Gen Xers—and likely to keep growing—and there remains the possibility Social Security's full retirement age is pushed back to make up for current pitfalls.
Much of Gen Z is already struggling economically, carrying more debt than millennials did at the same age and having higher delinquency rates, factors that make an early retirement even harder to attain. But young workers do have some things on their side, including earning more than previous generations and starting to save for retirement earlier, on average. They have far better access to low-cost financial products and high-quality investment information than generations before them. And they have the most of the most important asset: time.
The desire to leave the workforce early makes sense to Emily Irwin, head of advice relations for Wells Fargo. Americans' perspectives on work and life have been shifting over the past few decades, and Gen Z is "reimagining what their life cycle will look like," Irwin tells Fortune. "There’s been a prioritization of, 'Hey, we want to work differently, live differently, and we want to achieve a different type of American dream.'"
That doesn't necessarily mean clocking out of the workforce entirely. Americans' ideas of what constitutes retirement is also shifting, and Irwin suspects many Gen Zers just want more freedom—to travel, to be present for their children, to pursue passion projects before their sixties or seventies. If that's the case, she says it is entirely possible to work toward, well, not working in a traditional corporate environment. For those looking to leave the workforce early, here are some suggestions.
Start small
While saving for a potentially decades-long retirement feels daunting to anyone, the best thing to do is start small, says Irwin. Start saving and investing in earnest, and work out how much money you'll actually need to successfully leave the work force. Then, level up as you're able to, with the aim of maxing out retirement accounts while keeping a healthy supply of cash for emergencies.
"Are you putting in as much as you can at as young of an age as you can?" asks Irwin. "Front load your savings and your investments."
One strategy is to think of early retirement in one-year increments. How much more will you need to save each paycheck to leave work one year earlier than the norm? Once you meet that goal, you can work on saving for each additional year.
"It’s a little bit like paying off the mortgage early," says Irwin. "My goal is to retire at age X—what dollar amount per year do I need to set aside that’s additional to retire a year or two early? For most people, that’s not an exorbitant amount. That becomes more realistic, if you’re not talking about a decade. That could be something that’s very achievable."
Make the hard choices
Even for those earning a high salary, retiring early means being "maniacal" about your expenses now and in the future, Irwin says.
"It really depends on what you are putting away right now. If it’s the minimum, it’s not going to happen. You're going to need to put away some percentage of your income that most people find unpalatable," she says, noting that many early retirees spent less on day-to-day luxuries. "But if that's your goal and you can live under it, it works out."
To fund an untraditional retirement, contributing to a traditional retirement account is important but not enough. For one, the retirement period itself would be longer—and you'd need to tap into some savings before you're technically able to take a disbursement from a 401(k) or IRA. That means you'll need additional money either in cash or a brokerage account.
You'll also need to self-fund your health insurance until you qualify for Medicare. That's a potentially exorbitant expense. Finally, how much will it cost to actually do the things you want to do in all that free time?
"The surveys I've seen is that there’s an emphasis on experiences, on hobbies and travel—a more fluid lifestyle," says Irwin. "That all sounds great, but what is the cost of doing that? That’s easy to overlook when you have dollars coming in."
Be flexible
All of that said, even the best laid plans can change. There are countless factors that no one has total control over, including one's health or that of a loved one, the broader economy, and other challenges, says Ted Rossman, senior industry analyst at Bankrate.
"Plans change. Life is written in pencil," says Rossman. "Being adaptable is good, too."
Irwin seconds Rossman, noting it is rare to go through life without encountering a few hiccups along the way. When the worst happens, savers need to be prepared to shift—potentially away from their plan altogether.
"It’s incredibly difficult unless you're putting away a substantial amount of your income and nothing goes wrong—you don't lose your job, you don't go through maybe a divorce, you don't get sick," she says. "It’s doable, but there’s a reason most people don't retire as early as Gen Z would like to."
