What’s the Best Age to Retire?

Best Age to Retire

It’s no secret that Social Security is not as secure as it once was, and many Generation X’ers and Millennials realize this. In fact, according to Principal.com, 58% of Millennials believe Social Security won’t even exist by the time they reach retirement age. Additionally, in 2010 many Americans said they expected to retire after age 65 rather than before it. With the retirement game changing so drastically, what’s the best age to retire, and how do you ensure you can retire by that time?

While the typical retirement age has been 65 for the last several years, times are changing, and heading towards a more personalized, customized approach. Since everyone’s financial situation, health circumstances, and career paths are different, the best age to retire is the age you feel most financially and psychologically comfortable doing so.

No matter how you slice it, the fact of the matter is there is no single ideal retirement age for every American. Ideal ages will vary based on a number of factors, including financial feasibility, the ability to continue working, and the desire to continue working, among other things. Market Watch provides an extensive checklist of factors to take into consideration in order to calculate your ideal retirement age.

Forced Retirement vs. Voluntary Retirement

About half of those who leave the workforce early do so to cope with an unexpected health problem, or to take care of a spouse or family member. According to US News, many Americans expect to work until age 65 or later, however a significant amount are forced into an early retirement due to layoffs or health issues. However, US News also reports part of the reason people are working longer is because more people have a psychologically positive view of work than have in the past.

Additionally, research shows that many high earners – nearly half of those who make $75,000 a year or more – plan to stay in the workforce because they want to. However, 43 percent of those who make $30,000 a year or less will stay in the workforce because they must in order to maintain their standard of living.

Full Retirement Age then and Now

It isn’t just health issues and work satisfaction factors that determine retirement age. The full retirement age was raised by congress in 1983 from 65 to 67 for those born after 1960, and will likely continue to creep up. Increased life expectancies, a large population of retirees, and dwindling social security funds were all factors in this decision. Basically, if you decide to retire before age 65, there are a number of stipulations to consider that may reduce the amount of social security you are eligible to receive.

In conclusion, 65 is by no means a one-size-fits-all solution for every worker. Some may need to retire earlier for health reasons, and some may wish to retire later because they want to keep working. Whatever the case, it’s important to make sure you’ve got enough stashed away to maintain your standard of living as well as take care of an unexpected expense should one arise!

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