“Many people retire at around 60 or 65, but some people are happy to work into their 70s and beyond,” McCallum says.
Among those looking ahead to retirement, many expect to step away from work at age 65, according to the 2023 Retirement Confidence Survey. Although 65 is the anticipated median retirement age, workers report retiring at a median age of 62, the survey found.
If you don't have enough money in cash to make it through the first months of retirement and would need to start taking withdrawals from your retirement accounts immediately, you may want to consider retiring near the end of the year or the beginning of the year.
The full retirement age is currently 66 but is rising to 67 for people born in 1960 and later. Your Social Security benefit maxes out at age 70. Your checks could be 24% to 32% more than what you'd get at your full retirement age, and up to 76% larger than what you'd get at 62.
For people working in knowledge-based jobs, a retirement age in the 70s is reasonable from a cognitive perspective, too, said Lisa Renzi-Hammond, director of the Institute of Gerontology at the University of Georgia. “Our cognitive faculties we're able to maintain, usually, pretty well into our 70s,” she said.
Men responding to the early retirement offer were 2.6 percentage points less likely to die over the next five years than those who did not retire early. (Too few women met the early retirement eligibility criteria to be included in the study.) The Dutch study echoes those from other countries.
The best time to retire for tax purposes in Australia is generally once you attain age 60, as it is at this stage that you will have tax-free access to your superannuation.
An influential report from the National Academy in 2012 made an argument that the average work life be 48 years. You start work at 22 and work until 70. And if you start work at 18, the target work life is 52 years!
Many plan to leave full-time work before traditional retirement age. Despite changes in plan for some, the majority of Americans (62%) intend to retire, and many of them say they'll leave full-time work early. Of Americans who aren't retired yet but plan to retire, the average age they plan to retire is 57.
The Federal Reserve's most recent data reveals that the average American has $65,000 in retirement savings. By their retirement age, the average is estimated to be $255,200.
If you retire at a young age, Keys said, you get to see how those first few years pan out. If things aren't working as planned, all is not lost. You can go back to work since you're still young and energetic. Keys added, "Retiring early actually mitigates your risks by leaving you with a solid backup plan."
It's possible to retire by 40, but it takes a lot of planning (and aggressive saving) to do it. Start by running the numbers to find out how much money you'd need to save each month to retire early—and then decide if that's feasible.
At ages 46 to 50, you should have saved 4.6 times your current salary. At ages 51 to 55, you should have saved 6.0 times your current salary. At ages 56 to 60, you should have saved 7.6 times your current salary. At ages 61 to 64, you should have saved 9.2 times your current salary.
The 4% rule is a popular retirement withdrawal strategy that suggests retirees can safely withdraw the amount equal to 4 percent of their savings during the year they retire and then adjust for inflation each subsequent year for 30 years.
If you save up $6 million by age 50, you'll position yourself for a long, comfortable retirement. However, you'll still need to navigate taxes, income calculations and economic forces, all of which can create financial pressure during your golden years.
In fact, some studies have linked retirement to a decline in health. One ongoing study found that retired people, especially those in the first year of retirement, are about 40 percent more likely to experience a heart attack or stroke than those who keep working.
You may feel lonely because many of your friends are at work. You may be bored. The activities you try may not challenge or engage you. Many retirees feel they have lost their sense of purpose.
A helpful cost of living benchmark prepared quarterly by the Association of Superannuation Funds of Australia (ASFA), shows an average single person needs approximately $595,000 in superannuation before retiring, while a couple requires around $690,000.
So, how much does one need to retire in comfort? If you're single, you'll need more than $500,000, assuming you own your own home, according to the Association of Superannuation Funds of Australia Retirement Standard. That figure is worryingly higher than the average super balance.
The ASFA Retirement Standard Explainer says a comfortable retirement lifestyle would need $640,000 in super for a couple, or $545,000 for a single person.