5 answers to the ‘When should I retire?’ question
The ‘When should I retire?’ question can have several answers because it depends on your circumstances—and what you’re planning to do.
1. You can retire right now if . . .
The ‘if’ is about having a plan and the money to support yourself. Some do retire in their 50s or their 40s—and, occasionally, even earlier. Obviously, you need to have the finances to be able to do that.
The plan is also important because you probably won’t last long if you simply sit and veg. Be aware that most of those who retire early end up doing things that look a lot like work, even if they do have more freedom.
Then again, I have a friend who retired at the age of 60 but went back to work after a year or so to retire again several years later. He was fine financially but found he needed more structure in his life.
2. You may have no choice if . . .
One of the sad retirement statistics in Australia shows that 28% of males and 20% of females are forced to retire before the age of 65. They’re either unable to work because of their physical condition (sickness, injury, or disability) or they’ve been retrenched and can’t find another job.
There’s a warning in those statistics to be prepared for the unexpected. None of us knows what life will throw at us.
3. You may want to wait until you’re eligible for the pension
Many people choose to retire when they become eligible for the Age Pension because this allows them to access the pension for financial support. The Age Pension can currently be accessed at the age of 65.5, rising to 67 in July 2023.
If this sounds unfair, keep in mind that when the Age Pension was introduced in Australia (1909-10), it was available for men at the age of 65 and women at the age of 60 when the life expectancy at birth was 55.2 years for males and 58.8 years for females.
4. You can delay your retirement
The number of people planning to retire later than the retirement age is growing. This is partly because of financial concerns, but it’s also because people are enjoying what they’re doing. They like their jobs and the satisfaction they find in them.
And if you’re enjoying what you do, why not keep on doing it? You’ll find the stories of 14 who choose to keep working in Refusing to Retire.
5. You may want to work part-time in retirement
This is like the previous point, but with some retirement thrown in—it’s part-time retirement. It’s like having the best of both worlds—part work (with income and, hopefully, the satisfaction that your work brings) and part retirement (with the freedom that brings).
That usually looks like a weekly routine, but it can also be a week or even several weeks working and several weeks off. It depends on how flexible you and your employer can be.
The story of Alan Funk is a reminder of someone who turned a hobby (making banjos) into a part-time business in retirement. Is something like that an option for you?
Here are five different answers to the ‘When should I retire?’ question, and it’s quite a mix. What will be your answer—one of these, or something entirely different?