{"id":48706,"date":"2023-11-18T17:31:20","date_gmt":"2023-11-18T17:31:20","guid":{"rendered":"https:\/\/prosfunds.com\/finance\/whats-the-best-age-to-retire\/"},"modified":"2023-11-18T17:31:22","modified_gmt":"2023-11-18T17:31:22","slug":"whats-the-best-age-to-retire","status":"publish","type":"post","link":"https:\/\/prosfunds.com\/?p=48706","title":{"rendered":"What\u2019s The Best Age To Retire?"},"content":{"rendered":"
\n

Deciding when to retire is one of the most important decisions facing workers in their 50s and 60s. Your decision will significantly influence your financial security, health, and life satisfaction for the rest of your life. It\u2019s a serious decision that only you can make\u2014nobody else can tell you the best age at which you should retire.<\/p>\n

Let\u2019s look at the important considerations for deciding when to retire, ages when Americans typically retire, and the pros and cons of retiring early vs. late. Let\u2019s start by asking a key question.<\/p>\n

What\u2019s your definition of retirement?<\/strong><\/h2>\n

It\u2019s important to realize that people define \u201cretirement\u201d differently. The traditional definition of retirement is to stop working altogether. It\u2019s an all or nothing decision\u2014either you\u2019re working or you\u2019re not.<\/p>\n

Nowadays, however, many people express a desire to continue working in some fashion while they\u2019re in their 60s. \u201cI want to retire when I\u2019m 62, then I\u2019ll work three days per week,\u201d a physician friend of mine recently told me. Working during their retirement years is a goal that\u2019s shared by three-quarters of American workers, as reported in the EBRI 2023 Retirement Confidence Survey<\/em>.<\/p>\n

<\/fbs-ad><\/p>\n

As a result of this desire to continue working in some fashion, some people have an evolved definition of retirement\u2014they think of it more as improving their life by transitioning from working full time to working part time as long as they are able and still enjoy working.<\/p>\n

Working part time for a few years after you stop working full time has a significant benefit: It can significantly improve your retirement finances. For many people, that can be a very desirable and necessary goal.<\/p>\n

The age at which Americans typically retire<\/strong><\/h2>\n

An internet search for the average age of retirement in the U.S. produces widely different results. For example, a recent Gallup poll reported age 61 as the average age of retirement. Yahoo Finance reports age 64 as the average retirement age across America, but the average age varies significantly by state.<\/p>\n

The 2023 Retirement Confidence Survey<\/em> reports age 62 as the median age at retirement for current retirees. However, one in three current workers report that they want to work until age 70 or beyond, while a little more than one in 10 (11%) report they want to retire before age 60.<\/p>\n

One reason for these differences is that surveys rely on people self-reporting when they retired, and they depend on the respondents to define \u201cretirement.\u201d<\/p>\n

Consider your financial security <\/strong><\/h2>\n

Ideally, you\u2019d retire when you\u2019ve determined that you can be financially secure and you\u2019re convinced that retirement will truly improve your satisfaction with life.<\/p>\n

To be financially secure throughout retirement, you\u2019ll want to build a portfolio of lifetime retirement income that covers your expected living expenses for the rest of your life, no matter how long you live. It\u2019s doable, but it\u2019s a complex task that deserves your time, attention, and possibly some money to pay a retirement planner. The skills needed for this task are often beyond the expertise of most American workers, so you might need help from a qualified retirement planner.<\/p>\n

You\u2019ll also want to develop strategies to protect against common retirement risks, including inflation, stock market crashes, poor health, and the threat of high expenses for long-term care.<\/p>\n

Be clear about how retirement can improve your life<\/strong><\/h2>\n

Additionally, you\u2019ll want to be clear about your reasons to retire. Many people have negative reasons that push them into retirement\u2014they don\u2019t like working, they\u2019re bored with work, they got laid off, or they experience a health shock. While these are legitimate reasons that can influence your decision to retire, for the best outcomes, you\u2019ll want to build a positive vision of your life in retirement that can pull you (instead of push you) toward retirement.<\/p>\n

To do that, think through the various reasons you want to retire and how retirement will make your life better. Doing so will help you choose the retirement age that makes the most sense for you.<\/p>\n

Pros and cons of retiring early<\/strong><\/h2>\n

For the purposes of this discussion, let\u2019s define early retirement as retiring before age 65, which is commonly thought of as the normal retirement age.<\/p>\n

The pros to retiring early are fairly obvious:<\/p>\n