When Should You Retire? Five Factors to Consider
When people ask me, ‘When should I retire?’ I usually pause. It’s a simple question—but rarely has a simple answer.
Most people get to choose when they will retire, but even those who can choose aren’t sure when or how to retire. During coaching and conversations with people anticipating retirement, I found that deciding when to retire is often a major issue.
Sometimes retirement isn’t only a free choice. There are factors such as insufficient funds and the need to continue working, ill health, responsibilities in caring for a spouse or parents, or being laid off late in life that can force the decision sooner or later than planned.
There are several factors to consider in deciding when would be the best time for a person or a couple to retire.
1. Financial Readiness: Can You Afford It?
For many, money is the most significant factor in this decision. But it’s just one piece of the puzzle.
However, to retire, you have to know whether you can afford to retire and how your pension or other income sources will be affected by your chosen retirement date. There are also risks to consider, like inflation, taxes, and unforeseen expenses.
Sometimes people have unrealistic expectations about financial needs in retirement. Advertisements show retirees living in luxury year-round as though that’s the norm. I knew a successful lawyer and anesthesiologist couple who kept delaying their retirement because they felt they didn’t have “enough” yet.
Talk to your financial advisor. Be upfront about your desire to retire and the type of lifestyle you want in retirement, and see what your financial advisor thinks.
But don’t delay too long. Our financial advisor encouraged us to retire. He experienced too many clients who delayed until they were able to have the “perfect” retirement, and then died either right before or after their retirement. They waited too long.
2. What Will Give Your Life Meaning After Work?
Money matters. Of course it does. But it’s not the only thing that matters. Your post-retirement identity and purpose matter just as much as your finances.
Consider these questions:
• Who are you without your work?
• What will motivate and fulfill you when you’re not being paid?
• What activities bring you energy when you’re not working?”
• Do you feel more alive during time off, or do you find yourself missing the structure of work?”
Retirement is not only a step away from work, but a step toward a new identity and sense of meaning. Depending upon how you answer these questions, it might be a better option for you to continue with your current work where you already have a sense of identity and purpose.
3. Health and Energy: Don’t Wait Too Long
Health and energy are other factors.
The timing of retirement often considers current and future health. Time with good health becomes more valuable than money during retirement.
That’s because most of us can expect a decline in health as we age. Some of the things that we might want to do in retirement, we might not be able to do in retirement if we wait too long.
“The main argument for retiring in your mid-sixties or earlier is that there’s plenty of time, and you’ll arguably have more energy, to launch into a whole new direction – if that’s what you want to do.”
Celia Dodd, Not Fade Away: How to Thrive in Retirement
Retiring earlier often means having more energy for new adventures. But keep in mind that health and energy depend as much on mindset and activity as on age.
4. If You Still Love Your Work, Keep Going
Your interest in retiring is another factor to think about.
Some people enjoy their work so much that they don’t want to stop. Perhaps for them, something like a phased retirement would be better, where they go gradually from full-time to part-time employment.
5. Retirement as Reinvention
And finally, some people have a strong desire to explore and reinvent themselves in retirement.
Sometimes people become bored with their career and they’re ready to explore other options and reinvent their lives. Retirement gives them the freedom to follow their curiosities and explore new paths
Get the Right Professional Advice—Then Decide
Before you decide when to retire, seek the advice of professionals, such as financial advisors, doctors, and retirement coaches. But ultimately, it’s your decision.
Financial advisors can help you understand the economic aspects of retirement, and whether you have “enough” to retire based on your desires and expectations.
In retirement coaching, you and your chosen retirement coach work through all of the different issues involving the transition into retirement and how you feel about each one of them. It’s also a goal in most retirement coaching to come up with a tentative plan for retirement.
There’s More Than One Way to Retire
What type of retirement would best fit you? There are many ways to retire.
There’s the traditional “cliff edge”, as it’s called, which is all at once. You go from full-time work to no work.
There’s also phased retirement, which is where you gradually go from full-time work to part-time work. You can also transition to self-employment, where you do something that you enjoy doing or you’ve wanted to try doing on your own for a long time.
Be Flexible—Your Plan Will Evolve
The best retirements are often discovered through experimentation and adaptability rather than rigid planning.
So even if you have a retirement plan, stay open and flexible as you go into retirement and decide what works best for you.
Retirement isn’t a finish line—it’s a transition. Instead of searching for the perfect date, consider what you need to retire into, not just what you’re retiring from. If you’re unsure, talk with a coach, financial advisor, or trusted friend. And most of all, be kind to yourself in the process.
AI Note: I wrote this blog post myself, using my own words and thoughts for the initial draft. I used AI only to suggest headlines, section headings, and text improvements.
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