When is the Right Time to Retire?

Once we reach our 60s, most of us will begin to consider retirement. Some people may feel the need to exit the busy and often stressful business world, while others are full of creative ideas about what to do with newly available free time. Perhaps you’re also ready to relax, take it down a notch and savor peace and quiet each day. These visions of retirement can be compelling reasons to finally exit the workforce.

But before we can begin our second act, we have an important decision to make. We need to commit to a time and date to pull the trigger and commence retirement. This important decision will impact the rest of your life. Here’s how to decide when it’s the right time to retire:

Examine your financial resources. The first and most obvious duck to have in a row when picking a retirement date is having sufficient financial resources to allow you to meet your obligations and provide sufficient leeway to live the retired life you want. You want to have enough money to pay the bills and still have fun. Without this prerequisite, retiring from the working world is not the soundest of decisions to consider.

However, once you feel you will be able to live off the income generated by your savings and investments, it is not necessarily the right time for you to retire. There are other considerations that might improve your odds of realizing a truly fulfilling retirement.

Develop a plan. For the next 20 or more years, you will be living thisnew chapter of your life. You need to develop a plan for how you will spend your time. Decide whether you want to relax and take it slow or fill your days with new and exciting activities. It can be helpful to your planning if you have an understanding of what you will do each day after you no longer go to work.

Coordinate with your spouse. Whether your significant other is already retired or still working, things will change when you retire. If your spouse is already retired, your presence will be felt 24/7 and you will need to integrate yourself into your spouse’s world. It would be inconsiderate to expect your spouse to drop everything to accommodate you. The two of you can best get through this transition by trying to communicate openly, giving each other space to pursue individual interests and being patient. Try to be sensitive to each other’s point of view. You have many years left together, so make the effort to get it right. It will be well worth it in the long run.

Schedule enough to do. Twenty years of retired life is a long time to just relax. Can you enjoy your day if there is nothing on the schedule, just relaxing in the moment? Decide whether your current collection of interests and hobbies will be enough to keep you busy. For most people retirement will be a combination of engagement and relaxation. The appropriate proportion depends on your personal tastes. If you are someone who is happiest when you have activities and projects, it can help to dedicate some time prior to retirement to defining what those may be once you retire.

From my US News & World blog. Dave Bernard is the author of Are You Just Existing and Calling it a Life?, which offers guidelines to discover your personal passion and live a life of purpose. Not yet retired, Dave has begun his due diligence to plan for a fulfilling retirement. With a focus on the non-financial aspects of retiring, he shares his discoveries and insights on his blog Retirement–Only the Beginning.

Never Retire!

We hear every day about the impact our stumbling, bumbling economy has had on retirement nest eggs. Many have lost 30-40% of their savings at a time when then cannot afford a reduction of any kind. We retire to get away from the working world after scrimping and saving, to relax in the sun and the glory of no work. Isn’t that the way we are supposed to do it? That is what everyone from our employers to the government is telling us. So what is up with these senior citizens who say they do not want to stop working? Do they have a screw loose?

Barclay’s did a recent survey where they discovered that many wealthy workers have no intention of ever retiring. 60% of those surveyed in the U.K. plan to continue working, coining the phrase “nevertiree”. The survey was done for high net worth individuals so does it apply to the rest of us?

According to the Bureau of Labor Statistics, 18% of workers over 65 plan to continue working and this number is expected to increase to 22% by 2018. And this is not just triggered by recent financial problems. CNNMoney.com notes an upward trend in working longer prior to the financial collapse. So this thinking is across the board whether referencing the wealthy or otherwise.

Why work longer than you have to?

So how did we get to this point? Why would some find it attractive to keep working beyond retirement as compared to retiring as we are “supposed to”?

(1)  If you delay collecting Social Security benefits to age 70 instead of starting at your earliest possible age 62, your benefits will be 75% more.

(2)  Mental stimulation by remaining at work, facing challenges and meeting deadlines

(3)  Interaction with co-workers.

(4)  Making more money.

(5)  You are not responsible for planning out your day. You show up for work and away you go.

(6)  You like what you are doing and want to continue doing it.

And the trade-offs for continued work versus putting up a retired shingle?

(1)  You are still doing what someone tells you as opposed to what you really want to do. If you keep on doing the same thing, you may never have a chance to pursue what you are truly passionate about.

(2)  How much money do you really need to be happy? If you are struggling to make ends meet, work is the obvious option. But if not, do you really need an ostrich-sized retirement nest egg as opposed to a hen-sized one?

(3)  When will you ever get to those projects around the house, that stack of great books, those music lessons or that foreign language course that you have been looking forward to?

(4)  After working for 35-40 years, how about a change?

For me it comes down to a matter of personal preference. While I can understand having an interest in continuing to work for various reasons,retirement for me is my well-deserved time to do what I want to do. As long as I can afford to not work, that is what I will be doing. Before now was my working life. Moving forward is my retired life. And I plan on giving as much focus, effort and commitment to being retired as I did to working – maybe even a bit more.

Don’t forget to pick up a free copy of my Navigating the Retirement Jungle, available upon request by mailing to lovebeingretired@hotmail.com.