As you relax on the beach during your vacation, watching boats sail in the distance and feeling the sun bake your shoulders, you might think: I’d love to do this all day, all year ’round. But to make that dream a reality, you’ve got to find a way to retire early — without compromising your ability to pay your bills and live independently for decades during your retirement.
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If early retirement is on your financial vision board, you’d be wise to consult with a trusted advisor to get an idea of the steps and sacrifices required to achieve it. Author and financial expert Suze Orman is famous for her common-sense, plain-spoken advice across a range of financial topics, including early retirement.
Naturally, Orman has strong opinions on what people should do to make early retirement possible.
Maximize Your Retirement Funds
One of Orman’s biggest axioms is to live below your means and be careful in your spending. Instead of getting that designer bag or splurging on an in-ground pool, she’d rather you put all the money you can into your retirement savings — especially if you hope to retire early.
Simply put, you need to make regular, sizable contributions to your 401(k) and traditional and Roth IRAs, ideally maxing them out every year. For 2025, the maximum 401(k) contribution is $23,500 for employees under 50 and $31,000 for employees over 50. If your employer offers a 401(k) match, take full advantage of it. If you’re not maxing out your contributions yet, focus on increasing your contribution. If you were contributing 6% to your plan, Orman wants you to increase it to 7% or 8%.
For traditional and Roth IRAs, the 2025 contribution limit is $7,000 for those under 50 and $8,000 for those over 50. Income limits apply for contributing to a Roth IRA, so consult a financial advisor or tax expert to understand your eligibility and tax implications. Sometimes, maxing out just isn’t possible, and that’s OK — the key is to focus on contributing more than you did the year before. If you can’t reach the full limit, could you find a way to add an extra $1,000? You likely could.
For more personalized guidance, consider meeting with a financial advisor who can sit down with you, review your accounts, and help create a tailored savings strategy.
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Delay Taking Social Security
Yes, you’ve paid into your Social Security and yes, it is your money. But you can get the most out of those funds if you wait to collect it until you’ve reached full retirement age (FRA), which should be between ages 66 and 67. Technically, you can collect it as early as age 62, but it comes with the significant risk of locking in a permanent reduction in your payments. To get the full 100% of your funds, you must wait until you’ve reached FRA.
Orman puts the conundrum bluntly: “If you start at age 62, your benefit will be just 70% to 75% of your FRA benefit. That is a costly cut.”
Taking on a side hustle now that you could continue even in retirement from your formal “day job” could help you pad your coffers while keeping you active and social. Love home repair or gardening? Perhaps your local hardware store or nursery needs a helping hand during busy seasons. Or if you’ve always wanted to be a writer or graphic designer, now might be the time to get the training you need.
Diversify Your Funds
When meeting with your financial advisor, ask about ways to diversify your retirement income through a smart investment strategy. One option to explore is dividend stocks, which provide steady and regular payouts, typically once a quarter.
Other diversification strategies might include investing in real estate or fixed-income securities like bonds, depending on your risk tolerance and retirement timeline.
Reduce Financial Risk With Insurance
Ideally, you’ll enjoy a lengthy and healthy retirement. But things don’t always go the way we plan, which is why Orman advises having robust health insurance, long-term care insurance, and life insurance to protect your finances and your loved ones.
Consider purchasing long-term care insurance to help cover potential care needs, and ensure you have a plan for maintaining health coverage once you’re no longer on an employer-sponsored plan — especially if you don’t yet qualify for Medicare.
Without adequate coverage, you could be forced to dip (or even dive) into your retirement savings to cover unexpected expenses, potentially derailing your financial stability.
Proper life insurance and estate planning can also help protect your family’s financial future. Though it can be unpleasant to think about the reasons why you’d need this kind of coverage, having it helps ensure your legacy as a protector and provider remains intact.
Looking to build a legacy? Check out our Life to Legacy guide for expert advice and smart moves you can make today.
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This article originally appeared on GOBankingRates.com: Suze Orman: 4 Moves Every Aspiring Early Retiree Must Make Today
