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When is the Right Age To Retire?

As you move closer to retirement age, you’ve likely been involved in discussions about retirement planning. These may involve chats about employer percentages, being vested (or not), and the cost of living, or where to live. However, there is one important piece always missing from retirement conversation; the target retirement age.

The average age of retirement in the United States is 61 years old. Plenty of Americans retire before and after this age, for a variety of reasons. Surprisingly, 76% of employees say they’ll keep working past retirement age, and 35% of those people will do so because they have to.

For most people, it is a foregone conclusion that 65 is the magic number. However, the age varies significantly from person to person. Take steps to discover what age might be right for you and then take steps to make sure you are ready.

Taking an Early Retirement

Early retirement is generally referred to as retirement before a person’s ability to draw from Social Security or pension benefits (usually age 55-64 depending on their career field). The ability to retire early usually relies on the person having good financial stability, but can be influenced by personal factors such as health concerns or waning interest in a career. Often touted as the ultimate goal, early retirement can be more complicated than it first seems.

Early retirement might be the right choice for you, but you should evaluate your long-term and financial standing before you take the leap.

Benefits of Early Retirement

  • Reduction of stress

  • More free time

  • Ability to pursue passions

  • Potentially healthier and longer retirement

Downsides of Early Retirement

  • Less time to grow investments

  • Longer time of living off savings or fixed income

  • A potential loss of purpose or drive

Delaying Retirement

Late or delayed retirement is a term reserved for individuals waiting until after 65 to retire, although that age will change as Social Security benefits dates adjust for baby boomers. You may have a good reason to wait until your late sixties or early seventies to retire, whether it’s a love of your profession or the need to get more financially secure. As with early retirement, you have to weigh the costs and benefits of waiting.

Benefits of Late Retirement

  • More time to grow your investments and portfolio

  • Maximizing Social Security payments

  • A continued sense of purpose from your career

Downsides of Late Retirement

  • Work-related health decline

  • Potentially shorter retirement

  • Not transitioning to retirement with spouse or peers

Investments and Ongoing Financial Stability

Whether you choose an early, delayed, or regular retirement date will depend heavily on your ability to finance the years ahead of you in retirement. Utilize a financial advisor to ensure you have enough money to not only meet your needs, but also achieve your goals throughout retirement. Make sure you discuss your desired lifestyle, long-term care options, and plans for big-ticket items like trips or vacation homes. Then you can decide if your current savings meets those needs.

The most common forms of retirement savings are:

  1. Social Security

  2. Pensions

  3. IRAs

  4. 401k

  5. Annuities

Throughout your work life, you may have accrued one or many of these investment accounts. Be diligent in researching, tracking, and forecasting each account to determine an overall projected retirement income. That figure can give you a good idea of what age you will be able to retire in comfort.

Personal and Health Concerns

Money isn’t everything. If you have a chronic health condition that is worsened by work-related stress, or feel like you are missing out on important family milestones or time with your grandchildren, it may be time to call it quits.

On the other hand, economists have found that retirees have an average medical spend of roughly $122,000 in medical costs after the age of 70. Health concerns are a huge aspect of any retirement consideration, and saving as much as possible for retirement is certainly a priority.

For some people, downsizing and simplifying their lifestyles is enough to make retirement attainable. For others, putting off retirement for a few years allows them to save money, without sacrificing quality of life. Many people have found that retirement communities are the most affordable option, especially when considering the rising costs of in-home caregiving, medication, etc.

The Right Retirement Age? It Depends.

There is not a perfect age for retirement. In the end, you need to fully understand your personal goals, health, and financial means to come to the right decision and retire at the age right for you.

We’re here to help you with all your retirement needs, to answer your questions, and make you feel more confident going into some of the best years of your life.




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