7 Ways to Know If the Time Is Right to Retire

WaveBreakMedia / Shutterstock.com

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, you need to 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 you’re doing those budget calculations for your retirement, do the numbers only work if you take your Social Security benefits early? While there may be some good reasons that some people begin collecting Social Security at age 62 — such as knowing they won’t live long in retirement — you get more money if you wait until your full retirement age. That’s 66 for those born sometime from 1943 through 1954.

Starting early reduces benefits by a fraction of a percent for each month before your full retirement age. For example, claiming benefits at 62 means you lose 25 percent of your monthly retirement benefits — for life. Plus, if you decide you want to go back to work, you could end up owing Uncle Sam if you make too much money while receiving Social Security.

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 early or aren’t eligible for Medicare, you’d better be sure you can pay for health insurance. Without a job providing the benefit, you’ll have to buy a policy for yourself. And at your age, that won’t be cheap.

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 really 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

Speaking of being healthy, sometimes your body will let you know when it’s time to retire. If your job is negatively affecting your health, or you physically can’t do the job anymore, that’s a clear sign you’re ready to retire.

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. That may mean you can’t retire with the lifestyle you want, but it sure beats sticking with a bad job.

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.

(Check out: “10 Hazards of Divorcing When You’re Older.”)

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

sports
Ruslan Guzov / Shutterstock.com

Don’t retire if you don’t have any plans for what to do with your free time. Just don’t. Living every day like a lazy Saturday will get old after about a week. Plus, it could be hazardous to your health. 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
15 Purchases That Make Life Easier As You Age
15 Purchases That Make Life Easier As You Age

There are many products that can make getting older — or any time of life — a little easier.

The 13 Worst Types of Tickets for Your Car Insurance Rate
The 13 Worst Types of Tickets for Your Car Insurance Rate

Some types of traffic violations can drive your car insurance rate dramatically higher.

27 Things You Should Never Pay For — and How to Get Them for Free
27 Things You Should Never Pay For — and How to Get Them for Free

When you know the tricks, you can save big on all kinds of useful things that others pay for.

9 Free Things That Used to Cost Us Money
9 Free Things That Used to Cost Us Money

Not everything is getting more expensive.

7 Unusual Ways to Declutter Your Home
7 Unusual Ways to Declutter Your Home

Tired of possessions weighing you down? Here are seven ways to declutter painlessly and effectively.

View this page without ads

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

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

Am I Eligible for My Mother’s Social Security Benefit?
Am I Eligible for My Mother’s Social Security Benefit?

Can an adult daughter tap into her late mother’s benefit?

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.

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.

This Surprise Factor Can Raise Your Risk of Dementia
This Surprise Factor Can Raise Your Risk of Dementia

Nearly half of U.S. residents may face this threat.

Organize Your Home With These 10 Thrift Store Finds
Organize Your Home With These 10 Thrift Store Finds

Resolve to be clutter-free in 2021 with these secondhand purchases.

11 Laws You Could Be Breaking Without Knowing It
11 Laws You Could Be Breaking Without Knowing It

Seriously? Fibbing about the weather is a crime? This and other little-known legal traps await the unwary.

Is This Treatable Condition Causing Your High Blood Pressure?
Is This Treatable Condition Causing Your High Blood Pressure?

Researchers say too many doctors are overlooking this potential source of hypertension.

13 Things Seniors Can Get for Free — or Almost Free
13 Things Seniors Can Get for Free — or Almost Free

There are many ways to get cheap or free services and goods after reaching a certain age.

These Are the 3 Best Used Cars You Can Buy
These Are the 3 Best Used Cars You Can Buy

These vehicles boast reliability, safety and long-lasting value.

6 Legal Documents Retirees Need — but Don’t Have
6 Legal Documents Retirees Need — but Don’t Have

Few retirees have all of these documents that are crucial to their golden years — especially during a pandemic.

Internet Providers Can’t Charge You for This Anymore
Internet Providers Can’t Charge You for This Anymore

Starting this month, your ISP no longer can bill you for this fee.

21 Items to Cut From Your Budget That You Won’t Even Miss
21 Items to Cut From Your Budget That You Won’t Even Miss

Start off the new year by implementing these small-but-smart savings strategies. They’ll soon add up.

15 Painless Ways You Can Cut Costs in 2021
15 Painless Ways You Can Cut Costs in 2021

Follow these tips to save, so you’ll have money for things that really matter.

9 Small Expenses That Are Bleeding Your Budget Dry
9 Small Expenses That Are Bleeding Your Budget Dry

Keep more of future paychecks by eliminating these budget-busting unnecessary expenses.

11 Huge Retirement Costs That Are Often Overlooked
11 Huge Retirement Costs That Are Often Overlooked

Does your retirement budget account for all of these costs?

7 Tricks to Cleaning Your Bathroom Faster
7 Tricks to Cleaning Your Bathroom Faster

These tips can get your bathroom sparkling with little time and no elbow grease.

7 Bank Accounts With Extra Perks for Seniors
7 Bank Accounts With Extra Perks for Seniors

These accounts offer exclusive discounts and other perks — including interest — to older customers.

10 Times You’re Right to Be a Cheapskate
10 Times You’re Right to Be a Cheapskate

Clever shoppers can save money without sacrificing quality. Here is how to do it.

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.