How To Know When Its Time To Retire

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You Are Ready To Relax

Knowing When It’s Time to Retire

If you have you found yourself wanting to revisit leisure activities that motivate, inspire, relax or entertain you, then this is a good indicator you are ready to relax.

Whether it is a hobby or volunteer work, once you retire, having a new plan in place to keep yourself busy is key. Consider starting a to-do list and fill your days with things you have always wanted to do such as go fishing or start a vegetable garden.

You May Need To Make New Friends

If you retire in your 50s, you may find that your current friends aren’t around much because they still have full-time jobs. While you have the luxury of catching a matinee or playing a round of golf midweek, those in your social circle who are working nine-to-five don’t.

If you find new friends, they are likely to be older, says Dennis Nolte, a certified financial planner in Oviedo, Florida: Many of my pre-60-year-old retirees, especially those who are active, lament that their new peer group is significantly older than they are and thus have a different set of expectations about diet, sleep schedule, even cultural references.”

It Takes Everything To Get Yourself Out Of Bed On Monday Mornings

You dont want to go to work. You feel tired and lethargic, and the thought of getting out of bed on Monday mornings makes you want to throw up. It feels like your job is sucking all the energy out of your life.

And while it may be true that some aspects of your job are drainingperhaps youre working long hours or dealing with unreasonable friendsits important not to blame everything on your job or employer.

It could be that youre just tired of the grind and ready to move on.

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How Do You Know When It’s Time To Retire

Wouldnt it be great if there was a simple way to know when its time to retire? The truth is your circumstances are unique so theres no right or wrong way to make that decision. But deciding when the right time is for you is important. Youll have to consider things like income, pensions, debt, mental health and a number of other factors when making your decision. Lets explore everything you need to know before taking this important step of knowing when to take the retirement plunge.

You’ll Spend More Money Than You Think

Sometimes You Have to Admit It

A typical rule of thumb is that you’ll spend about 80 percent as much in retirement as you do when you work. After all, you won’t be shoveling money into your retirement account, commuting every day and, for that matter, paying Social Security payroll tax, assuming you have no more earned income. But at least in the early years of retirement, when you’re younger, healthier and newly freed from the constraints of work, you could very well spend as much as or more than you did before retirement. A J.P. Morgan Asset Management study found that there tends to be a spending surge by new retirees on travel, home renovations or relocation, and other retirement-related lifestyle changes that levels off after two or three years.

With inflation running at a red-hot 8.6 percent the past 12 months, your spending plans might need considerable revising. According to EBRI, 36 percent of retirees say their overall spending and expenses are higher than expected an increase from last year. Also up from last year is the share reporting that housing and travel expenses, specifically, are higher than expected.

“Every day is Saturday, says Sean Pearson, a certified financial planner in Conshohocken, Pennsylvania. Once you don’t work, you wake up and look for things to do basically, how we all feel on Saturday. Some things might be fun and social. Some things might be work around the house. Most things cost some money, which is why Saturday is often the most expensive day of your week.”

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Work Is Affecting Your Health

Is work having a negative impact on your health? Retirement could be the relief you need. Work life can be stressful, and you may get to a point where you resent the early mornings and busy commute. You can explore the option of working flexible hours or a less-stressful job, but retirement might be the safest bet to any underlying health issues. You may even be eligible for early retirement with ill health.

Youre Carrying Debts Into Retirement

Its a good idea to retire any debts before quitting work if possible.

Having a home with no mortgage lifts a big burden. Even without a mortgage, its expensive to pay real estate taxes, insurance and upkeep. Consider working a few more years or seriously consider selling and buying a smaller, cheaper home to ease money stress by retiring this debt.

Money Talks News has guidance on paying off debt and finding trustworthy counseling. Money Talks News partner Debt.com helps people manage out-of-control debt, free of charge.

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Serena Williams Announces Plans To Retire From Tennis: Analysis And Takeaways

Williams said in a Vogue cover story that she planned to move on from her sport, despite her reluctance, to focus on other things, including growing her family.

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The world first came to know Serena Williams as a 17-year-old with beaded braids, overwhelming power and precocious intelligence and poise when she stunned her sport by winning the first of her 23 Grand Slam singles titles at the 1999 U.S. Open.

So began a journey that, with plenty of help from her sister Venus and her trailblazing parents, changed the game, transcended tennis and turned Williams into a beacon of fashion, entertainment and business, shifting the way people inside and outside of sports viewed female athletes.

On Tuesday, Williams set the stage for the tennis part of that journey to conclude at the Billie Jean King National Tennis Center and the U.S. Open, where it began so many championships, battles, fist pumps and screams of Come on! ago.

In a first-person article in the famed September issue of Vogue, published online on Tuesday, Williams said that she planned to retire from the sport after playing in the U.S. Open, which begins later this month, for the 21st time. And as she has for more than two decades, Williams made the announcement with her own unique twist, stating in the as-told-to cover story that she has never liked the word retirement, and preferred the word evolution to describe her next steps.

Correction:

Create A Culture That Honors Experience

Is it time to retire?

If companies are to win back the hearts and minds of baby boomers and other generations of mature workers, they need to start with the work environment itself, which has become increasingly alienating to anyone over the age of 50. Human resource practices are often explicitly or implicitly biased against older workers, and these biases can seep into the culture in a manner that makes them feel unwelcome.

Traditional recruiting channels such as want ads or help wanted signs may not attract older workers either. Twelve years ago, pharmacy chain CVS looked at national demographic trends and concluded that the company needed to employ a much greater number of older workers. But managers didnt know how to find themolder people shopped in the stores but didnt apply for openings, perhaps believing they wouldnt be hired. Now the company works through the National Council on Aging, city agencies, and community organizations to find and hire productive new employees.

Retirement, as its currently understood, is a recent phenomenon. For most of history, people worked until they dropped.

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Physical And Mental Ability To Work

Some physically demanding jobs, such as working in construction, are difficult to continue past a certain age. Even if you prefer to keep working, you may find yourself running into physical difficulties performing your work.

If you experience cognitive difficulties, or if such health problems run in your family, you may also find yourself considering retirement earlier than you might otherwise want to.

If you are concerned about your physical or mental ability to perform your job, talk to your doctor about your concerns. They may be able to give you a projected timeline for how much longer you can expect to keep working.

If you anticipate having to retire early due to your health or physical ability, start planning early for how you will handle your finances and health care during retirement.

You Sacrifice The Power Of Compounding Interest

Time is your friend when you are saving for retirement, but not when you are spending. If you sock away $250 a month $3,000 a year from age 25 to age 55, you’ll have about $237,000 when you retire, assuming you make no withdrawals and earn an average 6 percent annually on your investments. Seemingly not a bad return on your $90,000 in contributions.

But let’s say you work 10 more years and retire at 65. In that scenario, you’ll have about $464,000, nearly double. Why? The extra decade’s worth of contributions helps, but that only adds up to $30,000. The real growth comes from another 10 years worth of interest earned not only on all the principal you contributed but also the interest earned on the interest that has compounded for four decades.

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You Have Enough Money For The Retirement You Want

It’s impossible to know precisely how much you’ll need in retirement, but there are some basic calculations you can make to see how long your money will last if you stop working.

You must first calculate what your annual living expenses will be. Research shows that people tend to spend less as they get older, but be sure to factor in the potential costs of new activities like travel, eating out, and caring for grandchildren. Then, examine how much money you have saved, and what the return on that money might be as you age. Match those numbers up with your expected life span. There are other things to consider, such as whether you plan to draw equity from your home. There are many online calculators that can help you with these figures.

Generally speaking, if you take the annual expenses you expect and multiply them by 25, you’ll be in the ballpark of what you need to retire comfortably. Once you are approaching this number, it may be a sign that you can stop working.

Youve Got No Plan For Long

When Do You Know It

Whats your strategy for getting care if you become unable to function independently in old age? Among those who live to age 65, about 70% will need long-term care before they die and 48% will require paid care sometime over their lives, says this article at the U.S. Department of Health and Human Services.

Some people have the money and foresight to buy long-term care insurance. Others count on their children, although if thats your expectation, make sure to talk it over with the kids early on. Or maybe youre planning to spend down your resources so Medicaid will pick up nursing home costs. Here are seven ways you could fund your long-term care.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

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Health Care Is Expensive

Medicare, the federal program that provides health coverage for more than 61 million older Americans, doesn’t start until age 65. Until then, you’ll need an alternative and it won’t come cheap.

“Private health insurance before Medicare kicks in costs an arm and a leg, says Brian Schmehil, director of wealth management for the Mather Group in Chicago. Current law says your insurance costs can’t be more than 8.3 percent of your household income. For a person with a household income of $50,000, for example, a mid-level silver plan would be $346 a month, or $4,150 per year.

Extra Income Can Be Hard To Come By

Working in retirement might not be as simple as you think. While 74 percent of workers plan to work for pay in retirement, according to the EBRI study, just 27 percent of actual retirees reported working for pay. Even part-time work can be a challenge. One thing early retirees dont seem to realize is that if they are planning on doing traditional part-time work while retired, those jobs require a commitment to a schedule that sometimes is not very flexible, says Leslie Beck, a certified financial planner in Rutherford, New Jersey. This can cut into other retirement goals such as travel or visiting with family. I have had retirees surprised by the inflexibility of part-time work.

If you figure youll instead fill the income void with Social Security, remember the earliest you can usually claim retirement benefits is age 62. Even then, youll only receive partial benefits. For anyone born in 1960 or later, the full retirement age, when you are entitled to 100 percent of your monthly benefit, is 67. By claiming early at 62, the benefit amount is reduced by 30 percent.

5 questions to ask before retiring early

  • Can I really afford to stop working?
  • Do I need to get a part-time job to make ends meet?
  • How will I get health insurance?
  • What will I do to occupy my time?
  • Are my plans in sync with my spouse/partner’s?

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Your Health Is Starting To Decline

In a perfect world, you will be healthy and spry enough to take advantage of all that retirement can offer. You will be perfectly able to handle that long bike tour through the south of France, and those backpacking trips on the Pacific Crest Trail. You’ll have energy to spend time and keep up with your grandkids. But, if you are starting to see your health fade, perhaps it’s time to stop working before you’re unable to enjoy retirement the way you wish.

How Old Do You Have To Be To Retire

Retire Now: Is it time to retire?

Full retirement age, or the age you need to be to collect full Social Security benefits, is 66 years and two months for those born in 1955 and will gradually increase to 67 for those born in 1960 or after. How old you have to be to retire comfortably depends on the lifestyle you want to have and how much you have saved. The earlier you retire, the larger the nest egg you will need.

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How Do You Live Comfortably After Retirement

Contents

17 tips for living comfortably from just a social security check

  • Postpone withdrawal of social security benefits.
  • If you have already applied for social security early, you should consider withdrawing your claim.
  • Plan your social security benefits.
  • Move to an area with lower living costs.
  • Repay the debt before you retire.

How much money does an average pensioner live on?

How Much Money Do You Need To Live Comfortably After Retirement

Most experts say that your retirement income should be about 80% of your final annual income before retirement. 1 This means that if you earn $ 100,000 annually upon retirement, you will need at least $ 80,000 per year to have a comfortable lifestyle after leaving the workforce.

Can I retire on $5000 a month?

Generally, you can generate at least $ 5,000 a month in retirement income, guaranteed for the rest of your life. This does not include social security benefits.

What does the average retiree live on per month?

According to data from the Bureau of Labor Statistics, older households defined as those run by someone 65 and older spend an average of $ 45,756 a year, or about $ 3,800 a month. I do not know about you, but spending $ 45,756 after tax a year on retirement sounds like a lot!

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When Is The Right Time To Retire

Are you financially prepared?

As you approach retirement, the first to consider is if you have enough of a nest egg to support yourself for the next 30 years . This is where you may decide to enlist the help of a financial advisor, who can look at your overall retirement picture and show you how to create a reliable stream of income. Your income sources could include cash reserves, retirement accounts, investments you may have, Social Security, annuities, pensions or cash value from permanent life insurance.

But how much do you need for retirement? While the average retiree spends just over $48,000 per year, ultimately the answer will depend on what you plan to do once you stop working. So as you start crunching numbers, think about how you want to spend your time, whether thatâs traveling the world or simply hanging out with the grandchildren.

Are you emotionally prepared?

Life without a schedule can be tempting, but many retirees find that they end up missing the social interactions and gratification that come with going to work every day.

Do you still feel motivated to get up for work each morning? Are you close with your colleagues? Is your personal identity wrapped up in your job title? Do you still get deep fulfillment from your job? If the answer is âyesâ to any of these questions, then you may not be ready to retire just yet.

How will you fill your days?

How does your partner feel?

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You Dont Trust The System

Sometimes You Have to Admit It

As things currently stand, the Social Security Trust Fund is due to run out in 2034. While this doesnt mean an end to Social Security payouts, which are primarily funded by taxes on current workers, it may mean a reduction in benefits to 78% of current levels. If youre not a believer that the U.S. government can fix this deficit, or you otherwise want to get any government payouts in your hand as quickly as possible, you may want to file early. While this doesnt guarantee that benefits wont change in the future, at least you wont be caught in the position of waiting eight years for your maximum benefit only to see that reduced before youve even received a dime.

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