Retiring at 55 vs 60 vs 65
One saver, one spending level, three retirement ages. The gap between them is far wider than most people expect — and almost none of it comes from the growth assumption.
The setup
A 50-year-old has £300,000 invested and adds £15,000 a year until they stop work. They want £30,000 a year from the portfolio in today's money, and the State Pension of £11,500 arrives at 67. The plan runs to 95. Only the retirement age changes between the three runs.
Assumptions used
- Age today / retiring at / plan to
- 50 / 55 / 95
- Starting portfolio
- £300,000
- Annual contributions until retirement
- £15,000
- Retirement spending from the portfolio
- £30,000 a year, today's money
- Guaranteed income
- £11,500 a year from age 67
- Expected return / inflation / volatility
- 6% / 2.5% / 13%
- Simulation
- 1,000 runs, returns drawn at random each year
- Contributions stop on the day work stops — no phased or part-time earnings are modelled.
- The State Pension figure is a full new State Pension approximation; check your own forecast on GOV.UK.
Taxes, platform charges and changes in spending through retirement are not modelled. Figures are illustrations produced by the Retiris model, not predictions.
Results across 1,000 simulated markets
| Scenario | Runs that lasted | Median years funded | Typical shortfall age | Steady projection |
|---|---|---|---|---|
| Retire at 55 | 21% | 22 | 73 | Runs out at 80 |
| Retire at 60 | 58% | 35 | 83 | £430,333 left at 95 |
| Retire at 65 | 85% | 30 | 89 | £1,116,341 left at 95 |
Middle of simulated outcomes, in today's money
Why five years matters so much
Retiring five years earlier does not simply cost five years of pay. It removes five years of contributions, removes five years of compounding on the whole pot, and adds five years of withdrawals at the start of retirement — the years when withdrawals do the most damage. In this model the projected pot at retirement moves from roughly £435,000 at 55 to £595,000 at 60 and £785,000 at 65, all in today's money, while the number of years it must fund falls from 40 to 30.
The bridge to the State Pension
Retiring at 55 means twelve years in which the portfolio funds every pound of spending. At 65 the bridge is two years. That difference alone explains a large part of the gap: the early retiree draws the heaviest withdrawals precisely when the pot is smallest relative to the remaining horizon.
What actually rescues an early retirement
- Lower spending. A permanent £3,000–£5,000 reduction moves the odds more than any realistic change in returns.
- Part-time work. Earnings that cover even half your spending for the first three or four years cut the deepest withdrawals.
- Flexibility rules. Agreeing in advance to skip inflation increases after a bad year is a cheap and effective defence.
- A cash buffer. Two to three years of spending in cash means you are not forced to sell into a falling market.
Model your own version
Try your own version
Everything else stays as set out in the assumptions above.
In this model, under these assumptions. Not advice, and not a forecast.
Frequently asked questions
Is retiring at 55 realistic?▾
For this saver it is the weakest of the three options: only about 21% of the 1,000 simulated markets funded spending all the way to 95. It is not impossible, but it needs either a bigger pot, lower spending, or a willingness to cut spending sharply in bad years.
How much difference do five extra working years make?▾
Moving from 55 to 60 lifted the success rate from roughly 21% to 58% in these runs, and from 60 to 65 it rose again to about 85%. Each extra year adds contributions, adds compounding, and removes a year of withdrawals — three effects pulling the same way.
Why is the jump so large?▾
Retiring five years earlier does not cost five years of income; it costs five years of contributions plus five extra years of withdrawals from a pot that had five fewer years to grow. In this model the projected pot at retirement rises from about £435,000 at 55 to £785,000 at 65 in today's money.
Can I access a UK pension at 55?▾
The normal minimum pension age is 55, rising to 57 from April 2028. If you are relying on private pension access before 57, check how that change affects your plan and whether you have any protected pension age.
What if I work part-time instead?▾
Part-time work is often the strongest lever available. Even modest earnings that cover part of your spending in the first few years reduce early withdrawals, which is exactly when withdrawals do the most damage.
Does the State Pension change the answer?▾
Yes, but only from 67. Between 55 and 67 the portfolio funds everything, so the earlier you retire the longer and heavier that bridge period is.
Sources
Modelled figures on this page were produced with the Retiris retirement model, described in full on how the model works. They are illustrations of hypothetical scenarios, not research findings about real households.
Retiris tools
Retiris publishes educational planning tools and analysis. Nothing on this page is personalised financial advice, and modelled scenarios are illustrations rather than predictions. See our editorial methodology and disclaimer.