Early Retirement Isn’t A Pipe Dream — Here’s What You Can Be Doing Now

When you’re at the start of your career, the last expense you may be thinking about is retirement. Rent, groceries, phone bill, sure. But something that’s decades away? That can easily go on the “for later,” right? Priya Malani, founder and CEO of Stash Wealth, gets it. “It’s hard to plan for life at 65 when you’re just trying to get through this month,” she says. 

It’s a common feeling among Gen Zers, only 20% of whom are saving for retirement, according to an October 2024 report from TIAA Institute. The reasons vary — from preferring to spend money on enjoyment now, to fearing they don’t have enough to set any aside yet, or thinking retirement is simply unrealistic. “When our parents were our age, they were thinking about marriage, kids, and how to save for a family," says Jen Zhang, 28, who just completed her dental school residency in New York City. "That's less of a thing now. People settle down later, the cost of living has never been higher, and a lot of people are barely getting by.” 

The good news: Saving for retirement, even early retirement, is possible for Gen Zers. Even if you aren't sure if you want to retire, it's a good idea to plan for it — especially if saving can become a part of your everyday, necessary money habits. For example, something as simple as using a card like the Verizon Visa Card to earn 4% in rewards on grocery store purchases, gas, dining, and takeout can help you build rewards to put toward your Verizon bill or new tech, like smartwatches or earbuds. Savings made, painlessly.¹

"To me, early retirement means having the financial freedom to make choices about what I do each day," says Taylor Price, a 25-year-old personal finance expert and founder of Priceless Tay, who isn't sure if she wants to retire, but she does want to reach a point where work is an option rather than a necessity. Here, Price, Malani, and others share how you can get on the right track for that kind of financial freedom.

When it comes to saving, time is your biggest ally. So the best time to start saving (if you haven't already started) is now. Over time, compound interest starts to work for you (in other words, your money is earning more money), and "this is especially true for those aiming for early retirement," says Price.

And the earlier you start, the less you may need to contribute to reach your goals. “Every dollar you save at age 25 will be worth around $14 at retirement,” Malani explains. “Whereas every dollar you save at age 35 will only be worth around $7 at retirement.” Bottom line? “No matter how much you need to save for retirement, you’ll need to save a lot more if you wait." If you haven't started, don't despair — it's never too late. Start now, and make saving a priority.

“When it comes to necessary expenses, do what you can to make them work for you,” Malani says. Both she and Price recommend using rewards credit cards so you get something back on those unavoidable purchases.

To choose a credit card, look at categories where your spending is highest and seek rewards that best align with those categories. For example, the Verizon Visa Card offers 4% in rewards on groceries, gas, and dining.

Of course, credit cards will only benefit you if you use them responsibly. Make sure you can afford any annual fees before you apply (even better if you have a card, like the Verizon Visa Card, that has no annual fee²), pay your bill in full every month to avoid interest that’ll damage your credit score, and stick to two or three cards at most “for a solid credit score,” Malani says. 

It’s key to set a goal of when you’d ideally like to retire. Then, you can use an online calculator to help you determine how much you’ll need to save so you can get started.  

When it comes to saving, you’ll need to take more action than simply putting money into a 401(k) or IRA. You should make sure your budget and spending are in order to help you save. For that, Price recommends a strategy she dubs the “rich routine.” 

“This means splitting your paycheck into intentional categories like a fixed bills account, flexed necessities (like groceries or gas), fun money, an emergency fund, sinking funds for short-term goals, and an investment account,” she says. “This system gives every dollar a job, and it ensures you’re balancing your current lifestyle with your future goals. It also automates your decisions so instead of constantly questioning where your money is going, you stay in control and keep it working for you.” 

Retirement saving isn’t a one-size-fits-all kind of thing, but there are certain types of plans that experts like Malani and Price suggest depending on your circumstances. If you have a full-time job, for example, your company may offer a 401(k) plan with a percentage match. “That match is essentially free money," Price says, "and taking advantage of it is one of the smartest financial moves you can make early on."

If your company doesn’t offer a 401(k), you work a part-time job, or you’re self-employed, you can still contribute to a retirement account. Price and Malani both recommend a Roth IRA, as long as your income doesn’t exceed the legal limit for doing so. “It allows your money to grow tax-free, and withdrawals in retirement are tax-free, too,” Price says. “If you’re over the limit, explore a backdoor Roth IRA or a traditional IRA.” If you're self-employed, look into a SEP IRA (“It lets you contribute a lot more, and those contributions are a business expense, which lowers your taxable income,” Malani says) or a Solo 401(k) — which you can contribute to as an employer and employee, “significantly increasing your annual contribution limit,” Price says. 

You don’t have to pick just one, either. Price herself does a combo, putting money into a Solo 401(k) for the higher contribution limits and a backdoor Roth IRA for the tax-free withdrawals. Malani also recommends selecting a target portfolio that automatically caters investments to align with the year in which you’d like to retire. 

Both Malani and Price are clear on their number-one tip: Automate your savings and contributions. “Many Gen Zers struggle with balancing present-day experiences with future plans,” Price says. “To combat this, I remove self-control from the equation by automating my investments. That way, I’m funding future me without having to choose between enjoyment now or security later."

If you’re contributing to a 401(k) through your job, Malani suggests finding out if your employer offers an auto-escalation plan — and if so, opt in. If not, “set a calendar reminder to increase your contribution by 1% each year,” she says. “By removing willpower and decision fatigue from the equation, you make consistent progress toward your financial goals."

One thing you don’t want to do: Overthink it to the point where you’re too overwhelmed to make a decision. “The most important thing is to start,” Malani says. And that includes making savings easier by choosing options like the Verizon Visa Card. "You can fine-tune as your income grows and your life evolves.”