How do you decide when to retire?

As you move through your working life, it’s easy to get a rosy picture of retirement and dream of the day when you finally step away from the office.

But how do you work out when that day should actually be?

Well, there’s no simple answer to this question, as there are so many factors that are unique to you personally.

However, there are several other questions you can ask yourself beforehand as you decide whether or not to make the leap into retirement…

Can I afford to retire?

Ultimately, your ability to enjoy a happy, fulfilling and secure retirement and the lifestyle you desire will be underpinned by your financial situation.

So take a holistic look at your finances so you can work out how much income you’re likely to receive in retirement. This includes your:

• Private pensions
• Investment income
• State and workplace pensions
• Cash savings
• Social security benefits
• Other assets, such as property

It’s also really important to look at your existing debts, as this will eat into your income unless you pay them off as quickly as possible.

What do you want from retirement?

There’s no one-size-fits-all model of retirement. Some may dream of a quiet life, staying at home and pottering around the garden.

Others, meanwhile, might see it as their opportunity to be more adventurous, travel the world, go to festivals and indulge in their hobbies and passions.

Or perhaps you’re someone who wants to spend time looking after your grandchildren and making the most of precious family time.

By asking yourself what you want from retirement, you can then work out what your chosen lifestyle is likely to cost you, and when you’ll be in a financial position to fulfil this goal.

Are you ready for the change?

Retiring is one of the biggest life decisions you’ll ever make. So it’s important to consider the practical and emotional impact of hanging up your professional hat.

You should ask yourself probing questions such as:

• How will you fill your days?
• Do you have hobbies and interests to keep you physically and mentally engaged?
• Do you have friends and family around you, so you stay socially connected?
• Are you disciplined enough to structure your days without work?
• Is your job a key facet of your identity, and if so, what will you be without it?

Of course, you might have been counting the days to retirement for many years and have no qualms whatsoever about stopping work.

But if you’re someone who thrives in the workplace and has struggled to achieve a good work-life balance in the past, adjusting to retirement can be difficult.

Are you in good health?

Retirement should be a time when you have the freedom to enjoy days out, holidays, family time and activities, so you don’t want to be held back by health issues.

You should therefore do all you can to increase the chances of enjoying good health in later life, such as maintaining an active lifestyle, managing existing conditions and not neglecting your mental and emotional wellbeing.

Investing in your health in the present is an investment in your future, and could put you in a position where you’re able to truly enjoy your retirement years.

Speak to your partner or spouse

If you’re unsure about when to retire, talk about it with your other half. Openly discussing your hopes and expectations ensures you’re both on the same page and working towards the same goals.

Seek financial advice

Getting to grips with every aspect of your finances and working out your likely income in retirement can be complex and overwhelming in equal measure.

However, a specialist financial adviser can take away this burden, examining your finances in the round to create a personalised retirement plan.

They’ll look at everything from your various sources of income to your existing debts, and guide you on what tax strategies can help you maximise your retirement income.

A financial adviser can also help you adjust your plan as your circumstances change over time, so you can be confident that you’re still on track to achieve your financial and lifestyle goals.

Retirement is something many of us dream of, so carefully considering your finances, health and lifestyle ambitions straight away can set you up nicely for the future you want and deserve.

*A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available