Retire at 60: Retirement Readiness Calculator & Guide

Retiring at 60 strikes a balance between leaving the workforce early and avoiding the extreme savings demands of retiring in your fifties. At this age, you are only five years away from Medicare and two years from the earliest Social Security claiming age. However, those gaps still matter. You need a clear plan for healthcare coverage, a strategy to bridge the two years before any Social Security income arrives, and a portfolio large enough to sustain 25 to 30 years of withdrawals. The good news is that ages 60 through 65 can also create a valuable tax-planning window.

The Healthcare Gap Before Medicare

Medicare eligibility begins at 65, so retiring at 60 leaves you with a five-year gap in employer-sponsored health coverage. This is shorter than the ten-year gap faced by those retiring at 55, but it is still a significant expense that must be factored into your retirement budget. In 2026, an ACA marketplace silver plan for a 60-year-old couple can cost $800 to $1,500 per month before subsidies. If your household income is between 100% and 400% of the federal poverty level, premium tax credits can reduce that amount substantially. COBRA allows you to keep your former employer's plan for up to 18 months, but you pay the full premium plus a 2% administrative fee, which often totals $1,000 to $2,000 per month. Some large employers offer early retiree health benefits, though these programs are increasingly rare. Planning for at least $50,000 to $75,000 in total healthcare spending between 60 and 65 is a prudent estimate for most couples.

Roth Conversion Opportunity Years

The period between ages 60 and 65 is often called the Roth conversion sweet spot. During these years, your wage income has stopped, but you have not yet reached the age for Required Minimum Distributions (RMDs), which begin at 73 under current law. If your only income is modest portfolio withdrawals, you may find yourself in a much lower tax bracket than during your peak earning years. Converting traditional IRA or 401(k) dollars to a Roth IRA during these low-bracket years allows you to pay federal and state tax at a reduced rate. Once inside the Roth, those funds continue to grow tax-free and can be withdrawn tax-free in retirement. More importantly, Roth IRAs do not have RMDs during your lifetime, so converting now reduces the size of your future taxable RMDs and the associated tax bill.

You Still Cannot Claim Social Security at 60

The earliest age to claim Social Security retirement benefits is 62. If you retire at 60, you must cover at least two full years of expenses without any Social Security income. This creates a bridge-funding requirement that your portfolio must satisfy. For someone expecting $1,800 per month at full retirement age, the two-year gap represents over $40,000 in foregone income that your savings must replace. Retiring at 60 gives you two years to evaluate your portfolio health and decide whether an early claim is necessary or whether you can afford to wait.

Funding 25 to 30 Years of Retirement

Retiring at 60 means your portfolio may need to sustain withdrawals for 25 to 30 years. The traditional 4% safe withdrawal rule remains a reasonable starting point for this time horizon, though conservative planners may prefer 3.5% to 3.75% given current market valuations and interest rate uncertainty. Sequence-of-returns risk still applies: poor returns in the first five to ten years of retirement can disproportionately drain your portfolio. Inflation also erodes purchasing power over three decades. At 2.5% annual inflation, the cost of living doubles in roughly 28 years. This means your portfolio should include a meaningful equity allocation to outpace inflation, even if you also hold bonds and cash for stability.