These 3 Pieces of Early Retirement Advice Are Overrated — Here’s Why

Core Insights - Early retirement advice often includes overrated rules that may hinder financial planning [1][2] Group 1: Retirement Savings - A common belief is that one needs $1 million to retire early, but this is not always necessary; a couple in their mid-50s with under $1 million can grow their savings to $2.8 million by age 90 with planned spending of $4,000 a month [3] - There is no universal retirement number; the amount needed depends on retirement timing and lifestyle preferences, as suggested by Fidelity [4] Group 2: 401(k) Contributions - The advice to max out 401(k) contributions may not be suitable for those nearing retirement, as these accounts are tax-deferred but fully taxable upon withdrawal, complicating early retirement [5][6] - Individuals focusing solely on 401(k) contributions may become "qualified rich, cash poor," lacking flexibility for tax-efficient income before Social Security or Medicare benefits begin [6] - A diversified approach to retirement savings is recommended, including contributions to a 401(k), Roth IRA, and a regular brokerage account for greater flexibility [7]