Is retirement really all it’s cracked up to be? The answer depends on where you find yourself financially, emotionally, and health-wise come age 65 or so.
When we’re young, we trade time for money and hope to stash away enough of it to later reverse the process and trade money for time. Ideally, we’d each have a few decades of independence before the grim reaper—or assisted living facility—comes knocking.
The statistics published on the Social Security website note that: “A man reaching age 65 today can expect to live, on average, until age 84. A woman turning age 65 today can expect to live, on average, until age 86.”
Should you retire at age 65?
What’s so magic about age 65 anyway? Nothing! It was the retirement age the government used when setting up Social Security in the 1930s. Since then Social Security’s full retirement age has moved to 68 to compensate for increasing life expectancies. Should Washington get serious about fixing Social Security, the age is likely to be pushed back further.
Keep age in perspective. It’s only one barometer; there are other factors much more important for deciding if and when to retire. Poor health may make the decision for you. But if you’re healthy, the most important factor is whether you have enough acorns stashed away to support yourself and your spouse for the rest of your lives. When you run the numbers—there are countless financial calculators available for doing just that—be optimistic and assume you’ll live long past age 84 or 86.
If you do have enough to make it and you enjoy your job, consider working a few extra years. That extra money is icing on the cake. Think of it this way: if you’re lucky enough to be healthy and vital at age 95, you don’t want to find yourself wishing for a bout of pneumonia because you’ve run out of money.
Once you’ve jumped over the financial hurdle, it doesn’t mean you have to or even ought to retire. Quite the contrary! Now you’re ready to do work or projects that fit your terms. If you love your job, are having fun, and see nothing else you’d rather do, just keep on enjoying it.
Personally, the wealthiest friend I have—now age 73—could have retired before he was 50, and he’s still working. When I discuss retirement with him, he makes it clear that boredom is the biggest enemy of retirees. He loves the challenges of the business world and feels it keeps him going.
On the flip side, I have a doctor friend in his 40s who’s unhappy with the state of the healthcare system here in the US. He has plenty of money and plans to give up his practice and move back to the family farm. He also mentioned that being on call and working weekends robbed him of too much time with family. He has several children and wants to be a more integral part of their lives. He no longer wants to work in an environment he does not enjoy, and trading more of his time for wealth is no longer a necessity for him.
Here are some questions to ask yourself:
- Is there anything else I would rather be doing?
- Do I enjoy the environment I’m working in?
- Am I accomplishing something other than just earning a paycheck?
- Do I enjoy the people I work with, or am I just putting up with them?
- Do I feel I am missing something?
- Is my spouse on board, or does he/she feel my working is prohibiting us from doing too many other things?
- Do I have other hobbies I enjoy that I could turn into a part-time business I would enjoy?
- Do we currently live where we want to live?
- Am I just tired of the rat race and want a change?
When I was in my late 50s, I asked a friend how you know when you’re ready to retire. He grinned and simply said, “You’ll know.” He was right.