Bridge the Gap: How to Retire Early Without Falling Into a Financial Trap
Thinking about retiring before 65? Here's how to plan for the in-between years.

Retiring early is a dream for many — but without the right plan, it can quickly become more stressful than freeing. Most people assume retirement starts at 65, but the reality is different: the median retirement age in the U.S. is actually 62. That gap between when you retire and when you can access benefits like Medicare and full Social Security can be expensive if you’re not prepared.

At Fiat Wealth Management, we help clients bridge that gap intentionally — creating income strategies and healthcare solutions that carry them confidently into the next phase of life.

The challenge with early retirement

If you’re leaving your career before age 65, you’re likely facing two main obstacles:

1. Healthcare
Medicare doesn’t start until age 65. If you lose your employer-sponsored health plan, you’ll need to find coverage elsewhere — often through the ACA marketplace or COBRA. And that coverage can be costly, especially without income-based subsidies.

2. Reduced Social Security
You can begin taking Social Security at age 62, but doing so permanently reduces your monthly benefit. The longer you wait — up to age 70 — the more you receive. Retiring early doesn’t mean you have to claim early. But it does mean you’ll need to build a strategy to cover your expenses in the meantime.

How do you bridge the gap?

We work with clients to create what we call a “retirement paycheck” — a reliable, planned stream of income to replace your working paycheck. Here are a few strategies we use to make that possible:

Use your HSA
A Health Savings Account can be a powerful tool in early retirement. If you’ve been contributing during your working years, you can use it tax-free for qualified medical expenses — including premiums in some cases.

Explore ACA plans or spousal coverage
Depending on your income in early retirement, you may qualify for subsidies through the Affordable Care Act marketplace. If your spouse is still working, you may be able to join their employer-sponsored health plan.

Implement a Roth conversion ladder
This advanced strategy allows you to convert funds from a traditional IRA to a Roth IRA over time. You pay taxes on the conversion now (while your income may be lower), then withdraw those funds tax-free later.

Use short-term annuities
Short-term or “bridge” annuities can provide guaranteed income during the gap years — giving you peace of mind while you wait to claim Social Security.

Don’t forget COBRA
While not a long-term solution, COBRA allows you to temporarily continue your employer’s health insurance for 18–36 months. It’s often more expensive but provides continuity during the transition.

Yes, you can retire early — but only if you plan for it

Retiring before 65 isn’t out of reach, but it does require thoughtful planning. The years between your last paycheck and your first Social Security check can be some of the trickiest to navigate — especially when healthcare costs and income needs collide.

That’s where we come in.

At Fiat Wealth Management, we specialize in helping people retire on purpose — with clear strategies to help them confidently navigate the years ahead. If you’re thinking about stepping away early, we’ll help you build a plan that bridges the gap between your last day at work and the retirement benefits you’ve earned.

Let’s talk about your early retirement plan

If you’re ready to start the conversation, our team is here to help. We’ll sit down, get clear on your goals, and walk through the strategies that can get you there — on your timeline and with confidence!

hello@fiatwm.com | 952.426.9116