Am I ready to retire at 42 with $4M+ net worth and young kids, or should I find another job?

It’s often the case that people who manage to accumulate a lot of wealth at a fairly young age get there by grinding away at a stressful job. And you may reach a point when you decide you want to leave a job like that and retire — especially if you have the savings to back that move up.

In this Reddit post, we have a 42-year-old father of two very young children who lives in a moderate cost of living area. His current job comes with a generous total comp of $500,000, and his family’s annual expenses come to $160,000, including a full-time nanny.

The poster has a net worth of more than $4 million, and they feel that they’ve saved enough to be able to pull off an early retirement in theory. But the one sticking point is the children.

The poster’s kids are only one and three years old. And that means they have their entire childhood ahead of them. So the poster isn’t sure if retiring super early is the smartest move given that.

It’s good that he’s thinking about the big picture when making his choice. But I think he has another option worth considering.

Be careful when there are kids in the mix

If the poster here had only himself to think about, I’d say go ahead and retire early with $4 million. But because there are kids to factor in, that changes the math quite a bit.

The poster clearly does a good job of living below his means. And since part of his annual expense is paying a nanny, that cost would conceivably go away if he were to retire.

But the poster may not realize how many expenses he’ll incur once his children get older. There are sports leagues, summer camps, and food and clothing (which get more expensive as kids grow).

There’s also college to think about. The costs there can be astronomical.

Plus, a growing number of parents are supporting their children through young adulthood these days. Inflation and student debt are making it tough for recent college grads to venture out on their own. So while the poster here may be planning to support his kids through, say, age 18, in reality, they might need financial help well into their 20s.

That’s why I don’t think the poster should rush into early retirement. Instead, I think they should look at working a less stressful and time-consuming job — one that gives them more time with their kids but allows them to earn a paycheck for a few more years.

The poster is in a great position in that he doesn’t have to worry about saving half his income. If he can earn enough to cover his costs and save a little bit, it gives him a nice cushion.

It’s okay to prioritize your kids

Time with your kids is something you can never get back. I can see why the poster wants to be more hands-on with his kids while they’re young. But the right job might allow him to do that, giving him the best of both worlds.

I would also recommend that the poster talk to a financial advisor to see what they have to say. An advisor can help run the numbers to see what risks the poster might be taking by retiring at such a young age and help him find a compromise.