Can I Retire Yet? How to Decide When the Time Is Right.


Picking the right time to retire depends on several factors, including how long your money needs to last, your savings, your debt, and the retirement lifestyle you want. Financial consultants can help you plan your retirement budget and decide how to make the most of your retirement benefits. Financial calculators can also help you determine if you have enough money to retire.

Deciding when to retire can cause anxiety. You need to have enough money to support yourself for the rest of your life, however long that might be. You may have heard that you need 80% of your preretirement income to have a comfortable retirement. This percentage is called a “replacement ratio” and may not always be an accurate or achievable percentage for everyone who is ready to retire. Here are some factors you may want to consider when deciding if you are ready to retire:

How long will you live?

We don’t know exactly how long we will live, but we do know that today people are living longer. A recent U.S. government study finds an average life expectancy for a person who is 65 today is 84 years. The Social Security Administration says one-in-four 65-year-olds will live to 90, and one-in-ten will live to 95.

How much have you saved?

A financial consultant can help you review your savings, including your 401(k) investments, savings accounts, certificates of deposit, and any material assets you own like your home to determine how much money you will have to live on when you retire. If you have a 401(k) account, you probably have a calculator that will estimate what your monthly retirement income might be.

AARP also offers a retirement calculator that uses data about your age, income, savings, and retirement plans to help you determine if you have enough to retire.

What will you get from Social Security?

Most of us will rely on Social Security benefits to fund at least part of our retirement. You can register for an account with the Social Security Administration to find out if you qualify for retirement benefits, view your estimated retirement benefits, and verify your reported earnings.

The age in which you can retire with full retirement benefits from Social Security varies depending on the year you were born — you can receive full benefits from as early as age 65 to as late as 67. Social Security has created a chart to help you determine when you can receive your full retirement benefits.

Regardless of your age, anyone can start claiming Social Security benefits when they turn 62, but your benefits will be reduced for starting early. If you wait to collect your retirement benefits until after your full retirement age, you will receive a credit, but you will have less years to collect those benefits. The Social Security Administration has a calculator that shows the percentage of full retirement benefits you will receive depending on the age you retire.

How much do you owe?

A financial consultant can help you prepare a budget for your retirement that will include any debt you owe, such as mortgage payments, credit card debt, and college tuition. If you need to pay down debt before you retire, your financial consultant can suggest the most cost-efficient ways for you to reduce your debt.

What kind of lifestyle do you want in retirement?

Is your mortgage paid off? Are you planning to stay in your house or will you be moving? Do you plan to travel? Will you be eating out more or less? Will your transportation costs go up or down when you are no longer working? Knowing how extravagant or frugal you want to be in your retirement years will help you decide if you have enough saved to retire.

Bottom line

Knowing what you owe, how long your savings can support you, and what kind of retirement you want can make it easier to pick a retirement date. A financial consultant can help you create a retirement budget and maximize the returns on your savings while minimizing the risk.


  1. AARP Retirement Calculator: Are You Saving Enough?
  2. CNN Money: How much income will you actually need in retirement?
  3. Federal Interagency Forum on Aging- Related Statistics: Older Americans 2016: Key Indica-tors of Well-Being
  4. Kiplinger’s Retirement Report: Will You Really Need to Replace 80% of Your Preretirement Paycheck?
  5. Social Security Administration: Early or Late Retirement?
  6. Social Security Administration: Full Retirement Age
  7. Social Security Administration: Thinking of Retiring?

The information mentioned in this article is for informational purposes only, is intended to provide general guid-ance and does not constitute legal or tax advice. Each person’s situation is unique and may materially differ from the information provided herein. You should seek the advice of a financial professional, tax consultant and/or legal counsel to address your specific needs before any financial or other commitments regarding the issues related to your situation are made. Popular Bank does not make any representations or warranties as to the content contained herein and disclaims any and all liability resulting from any use of or reliance on such content.