We’ve all thought about it. Maybe you’re kicking back on the beach with a fruity drink in hand, or maybe you’re cuddled up by the fireplace and enjoying the surrounding wilderness somewhere quaint and quiet. Retirement is that finish line that almost everyone strives for. It’s the time where you can hang up those work boots and slide into some comfortable slippers as you enjoy your next stage of life. However, the biggest issue that many seniors face, is knowing when to retire. Stability financially, medically, and mentally are just a few important factors to consider before you decide to retire. Here are just a few things to consider before you finally decide to retire.
Knowing When to Retire
Your Bank Account Says It’s OK
The biggest factor to consider when you decide to retire is how much money you have saved up. Whether it’s through a 401k, a pension, or another means of savings, you should make sure that you can comfortably live during retirement. You might want to consider talking to a financial expert to ensure that you’re on the right track and saving enough for the future. A common rule of thumb puts a sustainable withdrawal rate at about four percent. Another way to look at that would be to shoot for retirement savings that are 25 times larger than your expected annual withdrawal. Once you know that you remain financially stable during retirement, it’s time to check in with your physical health.
Your Body Says It’s OK
Knowing when to retire can be tricky, but another thing to consider is your personal health. Sadly, we only live for so long, so why not live in the moment and enjoy as much time as possible? If you’re in good health, you might want to consider taking an earlier retirement if you can. Your wanderlust might lead you towards a new and exciting journey.
On the other side, if you or your loved one does not have the best health, it might be time to enjoy those precious moments. As we age, it’s time to start thinking about a bucket list, and if your health is declining, there’s no better time to start than the present.
Your Healthcare Says It’s OK
While the healthcare landscape just begins to settle, knowing when to retire also should factor in your health insurance situation. Recent studies by Fidelity and others estimate that a 65-year-old couple retiring today will need between $200,000 and $400,000 to cover health care costs during retirement. That is in addition to what Medicare already covers. Whether it’s through private insurance, savings, or pension, it’s important to make sure that you’re able to take care of your health during retirement. You should be able to comfortably pay for medications, procedures, and any other medical expenses that you may be dealt with during retirement.
YOU Say It’s OK
Don’t forget to listen to yourself when deciding when to retire. It’s important to reexamine your priorities. Many who have trouble knowing when to retire fail to ask themselves what they want. Perhaps you or your loved one would like to spend time with family. Or, it might be time to finally explore the world. Either way, it’s time for you to embrace retirement and discover exactly what you want this time to be like. It’s time to start planning the next step!