Basically, the best time to choose to retire is when you can afford it. Since most people don't want to simply sit home with just their basic needs of food, clothing and shelter met, Social Security alone won't provide enough of an income. If you are lucky enough to have a pension then this plus Social Security may be enough to provide the retirement you want.
For most people additional income from retirement savings, coupled with Social Security and a pension, can provide the desired retirement life style.
Now days most people planning to retire also want to retain some type of productive activity beyond simply hanging out with fellow retirees. For many people this means continuing to work in come capacity either unpaid volunteer work or working for pay. Income from Social Security, a pension and/or retirement savings generally means that one can afford to engage in work that they like with compensation being a nice extra rather than compensation being the main objective of employment.
Thus, it is a good idea to invest some thought and planning into retirement (there is an abundance of books and articles on retirement planning) not only to make sure a person considering retirement can afford it financially but also they don't suddenly find themselves sitting home alone with nothing to do.
I am the author of a blog, baby-boomer-retirement.com, which has been read over 200,000 times.
The truth is that some people may never be able to completely retire. They simply do not have the money.
Most financial planners recommend that you work as long as possible for three reasons:
1. So you can receive the maximum from Social Security.
2. So you can save as much money as possible.
3. So you do not have to start drawing down your savings any sooner than necessary.
In fact, before you ever retire, you should change your lifestyle so that you are already living the lifestyle you believe you will be able to afford after you retire.
The sooner you simplify your life, the more comfortable you will feel about retiring.
Retirement is a funny thing. It has no meaning in many regions. It by many cultures is not a concept. I see retirement as a career change regarding work. It is a reality that sooner or later is accepted and has regard to evolutionary concepts of survival of the fittest. Along those lines 'fit' is either defined or redefined by the individual.
Watch the movie Unstoppable with Denzel Washington. Watch with the eye of an Osprey really close and discovery will be seen. Discovery of a man who retires. It is a saga, a thriller, and inspired from true life events. The protagonist is surrounded with retirement. All the subplots and characters introduced lend to the dilemma of retirement. It is an allegory with metaphorical language and the theme is how a career ends within life with focus on the various ways a career ends and consequences while pointing out the struggle of life continues with its consequences.
Lots of good advice from Chuck. One thing, though: don't leave it too late. If you can retire well before the mandatory age then do it. This way you'll have plenty of energy and your life expectancy - in your own mind, and this is important - will be one where you're thinking you can do a lot in the years ahead. Generally, people who work right up until their employer gives them the proverbial 'gold watch' and wishes them many days of 'happy fishing.' tend not to last long.
As Chuck says, it's admissable to have an income that you feel you can live reasonably comfortably on. So when you get that final paycheck along with the super payout DONT go on a worldwide three month holiday and buy that brand new car...well, not unless you've got a real lot of money. The tempation will be there but don't do it.
Also, start thinking seriously about what you really want to do with your life. You will now have the time to do things you never had enough time to do before. But balance out your life between adequate exercise, adequate mental stimulation, and adequate spiritual pursuits. We are body, mind and spirit after all.
It sometimes takes a bit of courage to know when to retire. Old habits and indentifying with what we've been doing all our lives is not always easy to leave behind. But if you do it right, you will find - as I certainly have - that retirement can be the most productive and enjoyable years of your life.
Ideally the best time to retire is when you have the lowest amount of debt as well as have sizeable nest egg to supplement your pension or social security. This should entail having a home that is (paid for), a car that is paid for, and most of your monthly expenses consists of utility bills, meals, clothing, and medical prescriptions. All credit card debt should be paid off within 30 days of the charge. Retired people should not be paying revolving interest for credit card use. Cash and carry if at possible is the way to go.
"A fixed income should coincide with a fixed monthly budget."
Having said that there are always exceptions to every rule and some people are willing to take on more risk than others. For example if no one in your family has ever lived past the age 72, you may choose to retire at 62 rather than working until you're age 70 to get the maximum social security benefits as the odds aren't too good you're going to live for more than a couple of years beyond age 70.
Gradual but consistent health issues may influence one's decision to retire. Most people want to retire while they're still in decent shape to do a few things on their "bucket list" (do some traveling, spend quality time with grand-children or simply with their spouse).
It's a tricky balance trying to avoid outliving your money while also trying to enjoy the fruits of your labor before dying. As they say:
"You can't take it with you!"
Dear slappywalker in my opinion best time for retirement is when you are overexerted and you have a lot of money for your trips to relax yourself and the dirty office politics starts making you sick then you should take retirement and give more time to your family and friends.
DR. DURRESHAHWAR PERVEZ
You can only retire when you:
1. Either feel like it
2. Really feel like it.
3. Think you have made enough money that could last you for eternity.
4. Know that your health cannot be trusted to carry you along.
5. When you want to try something new.
This reminds me, it's always good that people start making retirement plans for themselves very early.
Personally, there is no perfect answer this question as situations vary from person to person. What is applicable/advisable so this person may not be very beneficial to another. Take a lot of considerations before deciding whether it retiring now or sooner is practical to you and your finance.
You can however make guidelines or benchmarks to tell you the timing is right. For example, if you have a private long-term care insurance. I know many people would grunt at this suggestion but you can never deny the fact that you are aging everyday...and as you age, you are getting closer and closer in needing assistance or long-term care help. Nursing facilities are known to be estate-drainers and you don't want that to happen to you. As much as possible, invest on things like these. You'll be gladly in the future that you did so when the time arrives.
Also, if you're pension is steady and you have no debts left to pay, then I think that is the perfect sign to know that ready to retire and whatever you like. Traveling abroad maybe? Or collecting vintage items? It's all up to you
Also, you may want to check this site as they are great sources of information regarding retirement
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