7 Ways to Know If the Time Is Right to Retire

It seems like some people start thinking about retirement about the same time they start working. However, once you hit your 50s and 60s, the dream starts looking more like a reality.

But it’s a big decision. Before you quit the daily grind, be sure you’re ready both financially and psychologically. Here are seven ways to know you’re ready to say goodbye to the boss for good.

1. You’ve calculated your retirement budget

Senior internet
Tyler Olson / Shutterstock.com

Stop! You don’t get to retire unless your budget says you can. That means calculating how much income you expect to have in retirement, how much you’ll spend and how long your investments will last.

You can play with online retirement calculators to get a picture of different scenarios, but we don’t recommend you rely on them for a final answer. It makes more sense to bring in a professional financial planner who can help crunch the numbers and let you know if you will be able to live comfortably without a job.

For tips, check out “How to Choose the Perfect Financial Adviser.”

2. You don’t have to file for Social Security early

Hand cutting social security envelope
Jim Barber / Shutterstock.com

When making budget calculations for retirement, do the numbers only work if you take Social Security benefits early? While there may be some good reasons to begin collecting Social Security at age 62 — such as if someone knows they won’t live long in retirement — it’s often better to wait until your full retirement age. That’s 66 for those born sometime from 1943 through 1954.

Taking Social Security early reduces benefits by a fraction of a percent for each month before your full retirement age. So, think twice before claiming early.

For more on the topic, check out “12 Ways to Maximize Your Social Security Checks.”

3. Health insurance won’t break the bank

Close up of medical bills.
JohnKwan / Shutterstock.com

If you’re 65 and eligible for Medicare, health care expenses should not be a problem. However, if you plan on retiring earlier than age 65 or aren’t eligible for Medicare, make sure you can pay for health insurance. Without a job providing the benefit, you’ll have to buy a policy for yourself.

4. Debt is under control

pathdoc / Shutterstock.com

It’s not that you can’t retire if you’re in debt. It’s just that debt can make it hard to do all the great things you had planned for your senior years.

Being saddled with debt not only means less money for fun activities like travel, but it could put a crimp in your ability to pay for long-term care if and when the time comes. If you’re healthy, it might be better to work a few more years and get out of debt pronto.

5. Health concerns make it difficult to work

StockLife / Shutterstock.com

Sometimes your body will let you know when it’s time to retire — such as when your job is negatively affecting your health, or you physically can’t do the job anymore.

Ideally, the balance in your bank account will agree with your body. If it doesn’t, you may be forced to take Social Security early to get by financially in retirement. Or, you could sit down with a scalpel and your budget and cut away all extra expenses.

6. You’ve talked to your spouse

African American couple outside.
Monkey Business Images / Shutterstock.com

Your retirement isn’t just about you. It’s going to affect your spouse, too. So don’t make any decisions without sitting down for a heart-to-heart with your beloved. If you’re not on the same page about when and how to retire, it could make for a nightmare ending to your years together.

7. There’s so much you can’t wait to do

sports
Ruslan Guzov / Shutterstock.com

Don’t retire until you have plans for what to do with your free time. Living every day like a lazy Saturday will get old after about a week. Rather than leave the job you love because you’re “supposed” to retire at your age, only quit if you have a long list of activities you wish you were doing instead.

How did you know when you were ready to retire? Tell us in the comments below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
The 3 Worst Money Mistakes You Are Making at the Gas Station
The 3 Worst Money Mistakes You Are Making at the Gas Station

Beware these cash-guzzling missteps when you stop at any gas station.

3 Cable TV Companies Hiking Prices for 2020
3 Cable TV Companies Hiking Prices for 2020

Still married to your cable company? Hold on to your wallet!

7 Hobbies That Help You Live Longer
7 Hobbies That Help You Live Longer

Research shows some hobbies can add years — or even decades — to your life.

8 Types of Companies That Check Your Credit Report
8 Types of Companies That Check Your Credit Report

Federal law lets these entities peek at your credit — regardless of whether you’re borrowing money.

10 Tools You Need for Financial Stability
10 Tools You Need for Financial Stability

Have these tools and accounts in place so you can weather whatever comes your way.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

11 Things Retirees Should Always Buy at Costco
11 Things Retirees Should Always Buy at Costco

This leader in bulk shopping is a great place to find discounts in the fixed-income years.

Over 50? The CDC Says You Need These 4 Vaccines
Over 50? The CDC Says You Need These 4 Vaccines

Fall is the time to schedule vaccines that can keep you healthy — and even save your life.

11 Senior Discounts for Anyone Age 55 or Older
11 Senior Discounts for Anyone Age 55 or Older

There is no need to wait until you’re 65 to take advantage of so-called “senior” discounts.

11 Household Items That Go Bad — or Become Dangerous
11 Household Items That Go Bad — or Become Dangerous

When you get the impulse to stockpile these everyday items, pay close attention to their expiration dates.

8 Things You Can Get for Free at Pharmacies
8 Things You Can Get for Free at Pharmacies

In this age of higher-priced drugs and complex health care systems, a trip to the pharmacy can spark worry. Freebies sure do help.

These Are the 4 Best Medicare Advantage Plans for 2020
These Are the 4 Best Medicare Advantage Plans for 2020

Medicare Advantage customers themselves rate these plans highest.

7 Ways to Boost Your Credit Score Fast
7 Ways to Boost Your Credit Score Fast

Your financial security might soon depend upon the strength of your credit score.

The 10 Most Commonly Stolen Vehicles in America
The 10 Most Commonly Stolen Vehicles in America

A new model parks atop the list of vehicles that thieves love to pilfer.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

These jobs pay more than the typical job in the U.S. — and no bachelor’s degree is required.

The 15 Worst States for Retirees in 2020
The 15 Worst States for Retirees in 2020

Based on dozens of metrics tied to affordability, quality of life and health care, these are not ideal places to spend retirement.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

10 Reasons Why You Should Actually Retire at 62
10 Reasons Why You Should Actually Retire at 62

If you can, here are several good reasons to retire earlier than we’re told to.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

26 States That Do Not Tax Social Security Income
26 States That Do Not Tax Social Security Income

These states won’t tax any of your Social Security income — and in some cases, other types of retirement income.

5 Keys to Making Your Car Last for 200,000 Miles
5 Keys to Making Your Car Last for 200,000 Miles

Pushing your car to 200,000 miles — and beyond — can save you piles of cash. Here’s how to get there.

14 Things That Are ‘Free’ With Medicare
14 Things That Are ‘Free’ With Medicare

These services could save you money and help prevent costly health problems.

5 Things That Make Life More Meaningful for Retirees
5 Things That Make Life More Meaningful for Retirees

Retirees agree: These are the things that give them purpose and fulfillment in their golden years.

15 Amazon Purchases That We Are Loving Right Now
15 Amazon Purchases That We Are Loving Right Now

These practical products make everyday life a little easier.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.