If you miss that deadline, the IRS will tax the entire amount at your ordinary income rate. Many employers will agree to such an arrangement, eliminating the risk that you'll miss the 60-day deadline. You'll sacrifice significant tax-deferred earnings. As the chart on this page shows, working a few more years can greatly increase the size of your nest egg. Your post-retirement expenses may be greater than you anticipate.
Many early retirees underestimate their living expenses after retirement.
Sure, you'll save on gas and dry-cleaning bills. But other expenses could increase. For example, Medicare doesn't kick in until you're 65, so you may need to buy your own health insurance. Your Money appears Tuesdays. Wilson Blvd., Arlington, Va. 22229.