Early retirement can be an ambitious financial goal, but you can reach it with the right plan in place. Increasingly, employers are not offering traditional pensions to their employees, which in the past allowed them to supplement their guaranteed income and potentially retire early.

If you have a pension with your employer, you are in a lucky minority, but it may not cover all of your expenses if you plan to live large in retirement. With or without a traditional pension, it’s important to have a plan in place if you wish to make your dream to retire early a reality. 

Here are a few tips for working towards achieving early retirement. 

Apply for a health insurance plan 

People fail to plan for most common things when pursuing early retirement is health insurance. You can’t receive Medicare until you’re 65, and early retirement likely means an employer plan no longer covers you.  Early retirees need a strategy to bridge the gap from their retirement date until Medicare kicks in. When deciding on a pre-Medicare health plan, be sure to compare costs across with other health care plans and their package deals. 

Pay off debts 

Debt is retirement quicksand. It’ll keep you from enjoying that retirement of your dreams. And you definitely won’t be able to put away as much for retirement as long as you’re giving money to the mortgage company every month.

Each long-term loan that you take on jeopardizes assets that could be used for retirement purposes. In addition, you’re increasing your costs by having to pay interest, a completely unnecessary and avoidable expense. 

Set up different sources of income 

Retirement can mean different things to many people, whether it’s moving to paradise, spending more time with your family, or being able to do something you truly love, such as volunteer work or traveling. Whatever it is to you, the more you plan now, the better position you will be in the future to set yourself up for retirement and maybe, if you’re lucky, fulfill your dream of early retirement. 

For this, you could take part-time jobs and put that extra dollar towards investing. You can also generate assets through rental properties or small businesses. Alternative income streams help to cover your cost of living so you can save more towards your ultimate goal. 

Create a plan 

To retire early, it is crucial not only to develop goals and a course of action but also to stick to the plan. You can make this easier by making your savings and investment plans automatic, for example, if you and your financial planner determine that you should save $500 per month in your brokerage account, set up an automatic transfer to make sure it happens every month without having to transfer manually. 

Early retirement is certainly an ambitious financial goal, but it can be far easier with proper planning. These steps can get you well on your way toward financial freedom years before the average American leaves the workforce.