How To Determine When To Retire
I was recently skimming through the book, The New Retirementality by Mitch Anthony. It is a great read that will open the eyes of anyone considering retirement. It brought clarity to the factors people use to determine their retirement date. Not all of us will be fortunate enough to select our retirement date but for those that are, the decision is typically based on one of the three factors below.
1. Financial ability- While I find this factor to be the most common one people use for their decision you would be surprised how many people choose to consider it after they have retired. The typical financial goal is to “maintain my lifestyle without outliving my assets” but you must remember to account for your new found free time and the third factor below. If you want to start traveling or give more gifts to family members, you should include that in your planning.
2. What you’re retiring from- Are you retiring because you are unhappy with what you are doing or because you have hit an arbitrary date? If you are still sharp, enjoy your work, and are welcomed to continue working, your age shouldn’t matter. As I discussed in my blog How to Live Longer, there is research to show a longer life expectancy if you stay in the workforce.
3. What you’re retiring to- This factor is the one that I see given the least attention but can cause just as many regrets. Are you going to spend more time with grandchildren, at the gym, going back to school or traveling? While you can easily say I have plenty to do, you may be surprised and unhappy with the use of your time if you simply wake up and do what you feel like doing instead of activities that help you achieve what you have planned to accomplish. Most people thrive when they have activities that provide significance to their life.
I believe the most successful retirees have taken all three of these factors into account before determining their retirement date.
No matter what your age, it never hurts to start thinking about all of these factors. Before you close in on a retirement date, pick up The New Retirementality and check it out.