Subject: Re: Early retirement pitfalls?
FWIW

I also had a few unsubtle warning signs from my body that enough was enough before I retired at not-quite-58.

Plus, I'd always wanted to retire early, in large part because mine was such a high bandwidth job that my choices were binary: a) continue to do the job or b) do any, some, all of the million other things I'd been deferring for years.

Six-plus years of retirement in, I still wake up every day like it's the first day of summer vacation as a kid. The days overflow with stuff I want to do (none of which earns any money). Hours I've been bored: zero.

Financially, we're doing fine. As of the end of last year, using my retirement date as a baseline, our nominal net worth was up around 18%. (There was also a one-time pandemic-related extraordinary expense in 2020 which was a lot of fun but didn't do the bottom line any favors).

Cumulative CPI since my retirement date, however was more like 21%, so purchasing power over the six years was down three percent or so. Knee-jerk: ruh-roh

But, that's all pre-SS, pre-Medicare. Within 12 months, we'll both be on Medicare and one of us will be taking SS. In five years, we'll add my SS. The first will decrease our portfolio withdrawals by 20%; the second, another 20%. In perpetuity.

Upshot: we'll be fine, almost to a certainty.

My surprises: how much medical care costs, even with the ACA. We've had a few high medical cost years, and last year was a record. Expensive (uninsured) dental work, expensive prescriptions, an eye surgery, plus a high-deductible ACA premium of over $1500/mo. It added up.

Getting back to certainty: there is no absolute safety this side of the grave. As near as I can tell, the only way to be absolutely certain you won't run out of money before you die is to work until Tuesday and die on Friday.

Also: the seeds of retirement security were sown in your 30s and 40s. Working an extra year, or three, in your late 50s will not move the needle dramatically.

Taking all in all, reading the FIRE literature, looking at simulations, realizing I'm a sentient actor who's perfectly capable of cutting expenses substantially if the need presents, I put the odds of a fiscally successful retirement in the ninety-five-plus percent range. Trying to boost that to the ninety-eight or ninety-nine percent-plus would be asymptotic, as in requiring many more years that I wanted to give. As the man said, you pay a high price for a cheery consensus.

(...and by that point, an earthquake, plague, asteroid, cancer may well have derailed the whole train anyway.)

One incontrovertible reality: I've had six-plus years of a wonderful retirement in which I and my family have our health, and I've been having a grand time doing whatever I want.

A brief note on longevity risk. Going back at least five generations: no male ancestors of mine, and no female in my wife's, has reached 90. Additionally, neither of us are free of significant health issues, so weighing it all up it seems very likely that both of us will be gone by our mid- to late-80s.

The risk of becoming disabled in that period is of course very high, but there is some glass to break if we need to. Downsizing would add seven figures to the available cash. And, while full-time care is extremely expensive, the median length of stay in an assisted care facility of any flavor (e.g. memory care) is around two years. We're not talking about forty years as a quadriplegic after a diving board accident; we're talking about two old people with preexisting medical issues and a family history not suggestive of longevity.

Circling back to your question: what should/could we have done differently?

Probably nothing, TBH. As a previous poster said, do NOT retire on a shoestring. And if the ACA is in the picture, having dispassionate, experienced fiduciary advice as regards income stream sources to maintain ACA eligibility (and later, IRMAA considerations) is worthwhile even if only a one-time consultation.

-- sutton