What Age Should You Retire?

Are You Ready to Retire?

First Published Date : August 14, 2010 ADawnJournal.com

Everyone knows that the general retirement age is 65, which is when people feel they will retire. However, for some retiring at the age of 65 is too late, while retiring at that age is just too early. So, how do you know when the best year of your life is to retire? It is a tricky balance. You want retire in time so that you can enjoy your remaining years because no one wants to retire at 85. However, you also want to make sure that when you do retire, you have the money to enjoy yourself. You can’t live on $10,000 a year if that is all you have to sustain you for the next 20 years if you retire at 65.

When looking at if you are psychologically ready to retire, see if any of these match what you feel:

1.   You find that work interferes with the things that you want to do with your life.

2.   You want more freedom with your life.

3.   You want to retire when you can still enjoy your retirement and still have your health.

4.   You are prepared to lower your costs in order to save more in your retirement.

5.   You are not fulfilled or happy in your job anymore.

6.   You have plans and goals you want to fulfill with your extra time.

The next thing you need to do is look at whether or not you are ready to retire financially. This can be harder to determine because there are so many variables. Do the following to determine if you are ready to retire:

1.   Look at how much you pay out for expenses now, and determine what you can cut back on. Then, look at your expenses at that point and how much money you need to live on for the next 30 years.

2.   Look at how much you have in your savings and retirement fund and divide it by 30. If it gives you enough to live on, you may be ready to retire.

3.   Determine how much money you have in spare in case of disaster. As you get older, medical costs can come up and that will cause severe problems with your finances.

4.   When you retire at 65, you should have enough money to last you for at least 25 years living just on pensions, retirement income and retirement savings. It is important to remember though that if you retire at 55, you need to have 35 years of savings and retirement income at your disposal. The sooner you retire, the more money you need to live off of because there are more years before you reach the end of your life, statistically speaking.

If you match these criteria, and you are ready for retirement, then you should seriously look at retiring. Retirement is something that you will look forward to, but if you retire too late, or too early, you will not be able to enjoy it as you would want to.