6 questions to help you figure out if you're ready to retire

Up to 19% of the population retires each year.¹ Trying to decide if it’s time for you to join their ranks? While there’s no hard and fast rule for the “right” retirement age, there are some key moments to watch for.

Use these six questions to help you decide if you’re ready to retire.

1. What does your post-work retirement budget look like?

In some ways, retirement years are no different from pre-retirement years: You need a budget that accounts for expenses, income, and the progress you hope to make toward financial goals. Include any debts—but also be mindful in the years leading up to retirement about plans to pay off those obligations. Inflation plays a role, too: What things cost today is not what things may cost in the future.

In addition, not every year of retirement looks (or costs) the same.

• In pre-retirement years, you’re often assessing savings or making catch-up contributions.
• Early retirement may be characterized by more activity, perhaps with more expenses, while the middle of retirement may come with a few decreased expenses, perhaps from downsizing or fewer plans.
• In general, late retirement often comes with higher health care and living costs.

2. What are the withdrawal requirements and tax implications of your retirement income sources?

Different types of retirement savings accounts have rules regarding the age at which withdrawals must begin, and how and when you’ll pay taxes. Understanding the requirements of your various savings accounts can help you plan expenses.

For example, employer-sponsored retirement plans or individual retirement plans set a required minimum distribution, or RMD: It’s simply an amount of money you’re required to withdraw (and pay taxes on) each year. Pension plans, too, generally have a specified retirement age at which payouts begin.

3. When do you reach full retirement age?

The longer you wait to claim Social Security, the larger your lifetime benefits—but only up to a certain point. That’s age 70. (Learn more about timing your Social Security benefits.)

4. What’s your plan for health insurance in retirement?

Health care costs in retirement may include everything from premiums to out-of-pocket expenses—in short, items that you’ll need to include in your retirement budget. If you’ve had health insurance through an employer, you’ll also have to balance the options available to you, especially if you think you’ll want to stop working before the Medicare enrollment age of 65. What are key Medicare enrollment deadlines?

5. How do your retirement plans align with your partner’s?

You and your partner may feel pressure to retire at the same age.

But maybe you have personal or financial reasons to stagger the end of work. For example, if one person remains employed, the other may be able to defer Social Security until they reach full retirement age or access health insurance through their partner’s employer plan. Or you may simply enjoy work—a sign that you’re not quite ready to retire.

6. What are your post-work plans?

Find yourself endlessly daydreaming about how you want to fill your hours and weeks once you stop working? This may be one of the biggest signs that you’re ready to retire.

Many retirees plan some activities that bring joy, and some that offer purpose; both have been found to contribute to an overall sense of well-being. (In fact, too much free time may not be a great thing, according to the Journal of Personality and Social Psychology.)

As you think about if you’re ready to retire, make a list of what you want and need to do. Have you always wanted the flexibility to volunteer for a cause, or devote time to a hobby? If you want to relocate, what financial and emotional musts need to be in place first? Do you have trips and social connections planned (and budgeted for)? All may be signs that leaving the workforce is something you’re ready for.