How much do I need to retire at 60?
Last updated August 2026
Short answer
The tax code stops fighting you at this age. The decisions that matter become about timing rather than about access.
The arithmetic
Estimate annual spending, subtract Social Security and any pension, and size the portfolio against the remaining gap.
A $60,000 gap at 3.75% implies about $1.6 million, and at 3.5% about $1.71 million.
Because Social Security may start within a few years, the gap is often larger early and smaller later, which the flat multiple does not capture.
Access is no longer the problem
At 59.5 the 10% additional tax on early distributions stops applying to IRAs and workplace plans alike.
Traditional withdrawals are ordinary income; Roth qualified withdrawals are tax-free if the five-year requirement is satisfied.
That removes the bridge-building that dominates planning at 50 and 55, and turns the question into which account to draw from rather than which one you are allowed to.
Five years of health coverage
COBRA covers a limited period at full cost, and the marketplace covers the rest of the gap to 65.
Premium subsidies are based on modified adjusted gross income, which the mix of withdrawals partly determines.
Drawing from Roth balances or from taxable basis reports less income than drawing from a traditional IRA, which can be worth thousands in subsidy each year.
Try it in Walnut
Walnut connects to your brokerage and reads what you hold across accounts, which is where a withdrawal sequence has to start.
The Social Security decision
Claiming at 62 permanently reduces the monthly benefit; delaying past full retirement age increases it up to 70.
Delaying is effectively buying inflation-adjusted lifetime income with portfolio withdrawals, which is a good trade for anyone with reasonable longevity expectations.
For married couples the higher earner's decision also determines the survivor benefit, which makes delaying that one more valuable than it looks in isolation.
The conversion window
Between retiring and required distributions at 73 there can be a decade of unusually low taxable income.
Converting traditional balances to Roth during those years is taxed at that lower rate.
It also reduces the forced distributions later, which is what pushes some retirees into higher brackets and triggers Medicare premium surcharges.
If you keep working part time
Earned income allows continued contributions, including the enhanced catch-up of $11,250 at ages 60 to 63 in a workplace plan.
Part-time earnings also reduce portfolio withdrawals during the years the portfolio is most vulnerable to a poor sequence.
They can maintain employer health coverage too, which for the years before Medicare is frequently worth more than the salary.
What changes at each of the next five birthdays
At 62, Social Security becomes claimable at a permanently reduced rate, and the decision to delay begins costing portfolio withdrawals.
At 63, the enhanced workplace catch-up ends, dropping back to the ordinary amount from 64.
At 65, Medicare begins and the marketplace question disappears, which is usually the largest single reduction in the spending estimate.
Sources
Distribution rules and the 59.5 threshold are in IRS Publication 590-B, with the 2026 catch-up figures in Notice 2025-67. Claiming ages and benefit adjustments are published by the Social Security Administration. Walnut is informational and is not an investment adviser. This guide is educational and not personalized financial advice.
FAQ
How much do I need to retire at 60?
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Around 27 to 29 times the annual gap after Social Security and any pension, corresponding to a withdrawal rate of about 3.5% to 3.75% over a 30-year horizon. It is the first age where the familiar 4% research applies to roughly the right length of retirement.
Can I access my retirement accounts?
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Yes, without the 10% additional tax, since 59.5 has passed. Withdrawals from traditional accounts are ordinary income, and Roth qualified withdrawals are tax-free provided the five-year requirement is met.
What about health insurance?
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Five years to Medicare, covered by the marketplace, COBRA for a limited period, or a spouse's plan. Marketplace subsidies depend on income, so the accounts you draw from directly affect what coverage costs.
Why is 60 to 73 an important window?
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Income is often low, before Social Security and before required distributions begin at 73. That makes it the cheapest period for Roth conversions, which reduce the taxable income forced out later.
How much can I contribute if I keep working part time?
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The full limits apply while you have earned income, including the enhanced catch-up of $11,250 at ages 60 to 63 in a 401(k), 403(b) or governmental 457(b). Part-time work can therefore still add meaningfully.
Is 4% reasonable here?
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It is closer to defensible than at earlier ages, because 30 years is the horizon the research tested. Many planners still prefer slightly below it, with the flexibility to reduce spending in poor years doing the real work.
What is the main risk?
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Healthcare costs before Medicare and a poor sequence of returns in the first decade. Holding several years of spending outside equities addresses the second, and modelling marketplace premiums honestly addresses the first.
What changes between 60 and 65?
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Three things: Social Security becomes claimable at 62 at a permanently reduced rate, the enhanced workplace catch-up ends after 63, and Medicare begins at 65. The last of those usually produces the largest single fall in the spending estimate.