Early retirement may seem like an unattainable dream for many, especially if you have to wait longer for the state pension.

With plenty of planning, dedicated saving and some smart investment moves, however, you might find it much more realistic than you think.

The earlier you start saving into your pension, the better, according to the new Times Money columnist Bec Wilson, author of How to Have an Epic Retirement. “Plan for the gap years before your pension or state pension kicks in,” she said. “Clear your debts and, finally, ask yourself whether you really want to stop working or simply want more flexibility and fulfilment in what you do next.”

If you’re dreaming of handing in your notice and dipping out of the rat race, here’s what you need to do to make it happen.

Pay off your debt

Paying off any short-term debt and your mortgage are the most important things you can do to prepare for retirement, according to Aaron Gibbs from the wealth management firm Charles Stanley.

With those repayments no longer hanging over you, your monthly outgoings will be reduced, leaving you able to save more towards an early retirement. Pay off debt with the highest interest rate first — a student loan, for example, can usually be left until last and, depending on your repayment plan, may even have been cancelled out anyway by the time you retire.

Track down your savings

The rules around pensions are complex and always changing. The state pension age is rising and pensions are more liable to tax than ever, so the first thing is to figure out what savings you have — and where they are.

If you are a public sector worker you will probably have a defined benefit (DB) pension, which means that your employer guarantees you a fixed income in retirement based on your salary and years of service. If you are in the private sector you are more likely to have a defined contribution (DC) pension, where you build up a pot of money that is invested for use in later life. Both types of pension can be accessed from age 55 at the moment, but that is rising to 57 in April 2028.

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You’ll need to contact whichever scheme you are a part of to find out how much you can access and when.

If you are in a private sector scheme you could use your pot of money to buy an annuity, which will give you a guaranteed income, either for life or a set amount of time depending on which you prefer. If you do not want to hand over your entire pot you could leave it invested and take an income from it, through what is known as drawdown, or do a combination of the two options.

If retirement isn’t imminent, then maxing out your pension contributions is one of the biggest steps you can take towards getting there sooner, according to Robert Cochran from the pension firm Scottish Widows. Make sure you are getting the highest contribution possible from your employer (you may need to increase your contribution if the firm will match it) because not only does more money compound for longer but you also get tax relief on your contributions. This also applies to the self-employed.

“The earlier you do this in your working life, the better because that money will grow and grow while you go about your daily life,” Cochran said.

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The power of compound growth means small increases today can translate into a very different quality of life later on.

“For example, someone aged 30 saving 8 per cent of a £37,500 salary could build a £250,000 pot by 60. Delay by five years and the pot drops to around £200,000 — wait ten years and it more than halves to £115,000,” said Katharine Photiou from the pensions firm Legal & General.

And while there is no one-size-fits-all formula, a moderate starting point for a pension investment pot might be to have 40 to 60 per cent in stocks and equities, 50 to 30 per cent in bonds, and 10 per cent in cash, she suggested.

How much money will you need?

Once you know what money you have and where, you need to work out the minimum you will need to cover essentials such as food, housing and bills.

Then consider what luxuries are important to you — do you want two holidays abroad a year, to eat out every week and go to the theatre once a month?

A useful starting point is to multiply your desired income by 25, to give you a rough idea of the pot size you will need, said Marianna Hunt from the investment firm Fidelity.

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If you want £35,000 a year, you will need a pot of about £875,000, assuming a 4 per cent annual withdrawal rate. This is the amount many financial planners consider sustainable to ensure your pot will last over a 30-year retirement, Hunt said.

Someone retiring earlier will need to adjust to a more conservative 3 per cent withdrawal to account for the longer retirement, and potential market volatility.

“If you’re 55 and want to retire now, average life expectancy dictates that you are likely to have another 32 years to fund,” said Hunt. “But you also have a one in five chance of living to 95 and a one in ten chance of living to 99. That’s potentially 40 or more years you’ll need to eke your savings out.”

Maintaining a diverse investment strategy should mean that withdrawals and inflation do not eat away at the overall value of your pot.

Do you have enough to retire — and do you even want to?

Once you have figured out what retirement looks like for you and how much it is going to cost, look at how much you have saved. Is it enough to retire? Chances are it may not be, so how much do you need to start saving to reach that goal?

Retirement is a huge change, financially and emotionally, but semi-retirement could be a good middle ground. A staggered approach, where you reduce your hours or go part-time, could mean you still have a regular income while freeing up more time.

“Most people don’t actually want to do nothing for 30 or 35 years — they just want to escape the grind,” Wilson said. “In my opinion the goal isn’t retirement any more, it’s having a life with more choice and flexibility built into it.”

Retirement is a word many use in midlife when they are tired and want an “out”, she said. “It’s worth pausing to ask whether we really want to stop working or just stop climbing.”