When Should You Retire?

About half of Americans retire between the ages of 61 and 65.1 Among today’s retired households, a traditional pension or retirement plan appears to be one of the differences between a high- and low-income lifestyle. That’s because among the 41 percent of retirees whose annual income is less than $25,000, only 21 percent receive income from a pension or retirement plan. Of those who receive $50,000 or more, 80 percent enjoy this form of income stream.2

For many people contemplating retirement, the question isn’t, “When should I retire?” but rather, “When can I retire?” The answer may be whenever you can afford it. This means that your combined retirement income sources should provide enough for you (and your spouse) to live on for up to 30 years, depending on health and the family gene pool.

The percentage of retirees who claim Social Security before full retirement age has declined recently. That is seen as generally good news because the longer you wait to begin receiving benefits, the more you’ll get. In fact, monthly payouts increase by as much as 6.5 percent to 8 percent a year between ages 62 and 70.3

1 Dan Kadlec. Time. Dec. 1, 2016. “The Ages When Most People Retire (Hint: Probably Too Young).” http://time.com/money/4584900/ages-people-retire-probably-too-young-early-retirement/. Accessed Feb. 9, 2017.
2 Ibid.
3 Ibid.