How can you tell if you are ready to retire?

A senior woman in a towel — Your debt, savings, career enthusiasm and plans for the future should all factor into the decision

(Image credit: Tatiana Maksimova / Getty Images)

The end of the year is a common time to retire, but how do you know if it is the right time for you? Technically, you can start withdrawing funds from your retirement accounts at age 65 without penalty. But that age may or may not feel like the right time for you to exit the workplace.

Ultimately, the decision to retire is personal, and is one that depends on your financial situation and other life circumstances — not to mention how you are feeling about the drastic transition. If you are starting to notice some of the following signs, you may be about ready to hang up your hat.

Minimal debt

While debt is never ideal to have at any point, it can become a real burden during your retirement years, when you are no longer actively bringing in income and instead have to rely on what you have socked away. “If you are already debt-free, you might be ready to live on a fixed income,” said Investopedia. But if you still have outstanding debt, particularly high-interest debt like credit card debt, then you may have an easier time managing on a fixed income if you have that paid down prior to retiring.

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Confidence in your retirement savings

A major determinant in whether or not you are ready to retire is whether you have enough saved up to cover your needs and sustain the retirement lifestyle you have envisioned. To gauge this, “identify all of your sources of retirement income, tally your budget requirements, consider hobbies, travel and unexpected medical expenses and see if your savings, factoring in inflation, are enough to achieve your retirement goals,” said Kiplinger, citing Scott Bishop, the managing director at Presidio Wealth Partners. A financial advisor can also help you run the numbers.

No more enthusiasm for your career

While “from time to time, it’s normal to feel numb to your job,” if you are experiencing these feelings regularly, say, “more than once or twice a week, it might be time to pack it up,” said The Wall Street Journal, citing David Conti, a retirement coach at consulting firm RetireMentors. Other signs it might be a time to retire include lost interest in career advancement, such as if you “shrink from learning new tech tools” or actively “avoid promotions,” or do not even see any prospects on your horizon, said the outlet.

Vision for what lies ahead

A successful retirement also hinges on having a plan for what is to come — otherwise, you may risk feeling lost without the structure of your working life. “If you don’t have any activities you’d like to pursue outside of work, that may be a sign you aren’t ready to retire,” said U.S. News & World Report. But if you have big plans for travel or potential hobbies you are longing to try, alongside a clear budget and a plan for tackling realities like inflation and health care costs, then you very well may be ready to sail off into your golden years.

Becca Stanek has worked as an editor and writer in the personal finance space since 2017. She previously served as a deputy editor and later a managing editor overseeing investing and savings content at LendingTree and as an editor at the financial startup SmartAsset, where she focused on retirement- and financial-adviser-related content. Before that, Becca was a staff writer at The Week, primarily contributing to Speed Reads.