When to retire?

 As I stated in an earlier post, more people are or have retired and this is causing an interesting shift in the attitude of both employees and employers. Over the two years since the Covid-19 pandemic struck, more people than usual have retired. Research showed that since the pandemic started, a quarter of people had changed their plans for retirement and around one in seven considered accessing their pension funds earlier than planned.

The decision on when it’s the “right time” to retire is not easy, it is complicated and personal. It can be influenced by your health and ability to remain in employment, or the health of a loved one, Many boomers are providing care to elderly relatives, sometimes alongside supporting their own children.

However, there are also many benefits to staying in employment, not just financial but also social interaction and sense of purpose. In the past, many people assumed they would retire between 60 and 65. Many pension plans offered by employers coincided with government pensions.

However today there is not a normal age to retire, and government pensions in some countries are offering incentives to work longer and in others, they are increasing the age in which a person can collect the pension.

The rules differ from country to country about when a person can/should retire. In Canada, most individuals can start taking their Canada Pension from age 60, with more pension income the longer one waits. The Old Age Security kicks in when a person reaches 65. In Canada and other countries, because of the labour shortage, there is growing interest in “transitioning into retirement”, reducing hours or days worked.

For those who have already retired and who were told that retirement is an irreversible decision. It is not. On retiring, you may give up the right to return to that job, but in today's job market you may still work at your old job, but only part-time. Another alternative is that you can always seek new employment, which need not be in your previous line of work.

Even so, deciding when it is the right time to retire can be a daunting decision and financial advisers and retirement coaches can help you weigh up all the factors.