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Quiz: Is This the Right Time for You to Retire?

Category: Retirement Planning

October 2, 2012 — Remember when you were in your 30’s or 40’s and some guy at a party would ask people “What their number was?” As in, how much money do they have to have stashed away before they could take their job and shove it. Those days might seem pretty far away now, as our natural dates for retirement get closer and closer. This article will ask you some questions to help you determine if this is the right time for you to retire.

Retirement is a big step. Once retired, it is hard to reverse that decision, particularly getting back into the workforce. Our previous surveys at Topretirements indicate that there are a significant number of people who feel they retired too early. We urge you to be sure you are ready before you take the plunge. To help you with your decision we have prepared this quiz. Keep track of how many Yes and No answers you have and at the end we will provide you with an informal, non-scientific score.

1. Do you wish you didn’t have to go to work in the morning? __YES ___NO
A Yes answer provides a pretty good reason to retire. But that doesn’t necessarily mean there isn’t another job or line of work you might enjoy. And if you love what you do, why would you want to stop?

2. Is your spouse or significant other supportive of you retiring? __YES ___NO __NA
If your spouse seems against or isn’t supportive about you retiring now, pay attention to what those concerns are. They might just realize something you don’t.

3. Have you developed some strong interests, hobbies, or friendships outside of work? __YES ___NO
Our suggestion: Get started now with some hobbies or interests. You will be happier if you have some ideas and experience with how to stay busy, before you cut the cord.

4. Are you fully vested in a substantial defined benefit pension? __YES ___NO
Not that many people have a defined benefit pension anymore (a promised amount you will get, regardless of what you have contributed). But if you are among the fortunate and disappearing few that do have such a pension, you are sitting on a figurative gold mine. To make the most of this benefit, however, you don’t want to retire before you are fully vested. If you do, you might be leaving significant dollars on the table. Your accountant or financial advisor can calculate the present value of your pension for you. Here is one simple illustration (the present value would be less): a yearly pension of $25,000 collected for 25 years is equivalent to a lump sum payment of $375,000 – a lot more than most people have saved for retirement.

5. Does your post-retirement income (including pension, social security, IRA withdrawals, part time work, retirement savings, and investment income) amount to at least 80% of your current income?
__YES ___NO
This is the biggie, because if you don’t have enough money to live comfortably, it will be hard to be happy. Our survey respondents indicate that having enough money is very important to a successful retirement. Most people can live on a bit less after they stop working, but most of your big expenses will continue. Medical expenses are likely to be higher than they were during your working days.
It is fairly easy to calculate how much your social security and pension will generate (see For Further References below), but figuring out what your investments will provide is more complex. One common rule of thumb is that you can safely pull out 3-4% or your total each year and not run out of money.

6. Are you at least 66 years or older, or can you live without collecting Social Security until then? __YES ___NO
This question has to do with maximizing your social security benefit. If you have an average life expectancy and take your SS benefit before age 66 you are definitely giving up a significant benefit for you and your surviving spouse. Better yet, for each year you delay claiming between age 66 and 70, your benefit will increase 8%, plus COLA. So if you can delay claiming, either by working longer or by using other savings to live on, you will be much better off.

7. Are you 65 or older, or will you have company paid health insurance after you retire? __YES ___NO
Many people severely underestimate how much it costs to provide their own health insurance until you reach 65 years of age and Medicare kicks in. A husband and wife can easily pay $1,000/month in premiums, plus have a $5,000-$10,000 deductible. Expensive drugs and dental care can add onto that. So there is big incentive to wait until you are 65.

8. Have you developed a plan for how you are going to keep you busy every day? __YES ___NO
Not having enough to do was a highly rated choice on our recent survey of the best and worst things about your retirements. If you don’t have a hobby, sport, or interest – we suggest you find one before you retire. Most people would agree that busy people are happy people!

9. Do you know where you would like to live when you retire? __YES ___NO
It is not essential that you know where you are going to live once you retire, but it does help to have thought about it. Even if you decide to stay right where you are now, make that a conscious decision rather than something that just happened.

10. Is your debt for credit card, education, or mortgage paid off? __YES ___NO
Trying to pay off debts with a reduced income is asking for trouble. If are still paying on a mortgage or other loan, try to get it paid off before you retire.

We will be the first to admit this is a non-scientific quiz. But we feel you should examine your answers carefully – retirement is a big deal and a second chance on life. So here’s what we think:
All Yes answers – Congrats, you are ready to retire. Good luck!
1- 2 No answers – You will probably be OK , but think twice about what your No answers were. Obviously, some questions are more important than others (for example, a No on Question 4 or Q 6 is of no consequence if you answered Yes to Q 5. But, if you answered No to question 5 (post-retirement income), that answer alone is a good reason to stay working. If you don’t have enough money your chances of a successful retirement are severely impaired.
3-4 No answers – We strongly suggest you consider postponing retirement until you have had a chance to work on your outstanding issues.
5 or more No’s – Retire at your own risk!

Bottom Line
We hope that you find this quiz useful in your retirement preparations. Please add your suggestions and reactions in the Comments section below!

For further reference:
New Retirees: Avoid These Mistakes
Top 8 Financial Risks You Face in Retirement
Unexpected Expenses in Retirement
Social Security’s Retirement Benefit Estimator
What You Think You Know About Social Security Might Hurt You

Posted by Admin on October 2nd, 2012


  1. All food for thought.
    For a “quick and dirty” answer to the question this quiz poses, I suggest you answer these three questions: DO YOU HAVE ENOUGH? HAVE YOU HAD ENOUGH? DO YOU HAVE ENOUGH TO DO?

    Jan Cullinane
    The Single Woman’s Guide to Retirement (AARP/John Wiley)
    The New Retirement: The Ultimate Guide to the Rest of Your Life (Rodale)

    by Jan Cullinane — October 3, 2012

  2. Is your job killing you?
    Is your job/position your identity?

    by Lane — October 3, 2012

  3. Good food for thought, but the all important Q5 is just too general and too equivacable.

    Do you really plan to live the same in retirement as you did while you were working necessitating 80%? My wife and I both worked and did lots of overtime. We ate out on the way home 3 or 4 nights a week. If that continues, it does take a lot more money. But if you start cooking for yourself with the occasional night out, it takes a lot less. You car expense may not be as high as commuting. Look at all the expense items and how they would compare after retirement vs. before.

    The mortgage (or other loans) is a big part of the 80% question. If you have no debts, that should reduce it.

    Do you plan to retire to extravagance or is a quiet life preferrable? (Remember, you may be talking 30 years or more.) Do you plan to travel a lot every year (expensive) or is one nice “vacation” a year more your style? Will you have to pay out a lot for upkeep of your home?

    One question not asked is whether you have a budget? Do you REALLY know what you are spending and what you expect to spend in retirement? If not, then the 80% is a total shot in the dark.

    by Rich — October 3, 2012

  4. Rich, You raise some excellent points to think about. As you point out, Q 5 is highly personal, and all depends on what your budget is going to be (and that should have been Q 11, which we will add). I see a lot of consensus that it takes around 80% of pre-retirement budget to maintain standard of living. But it will depend on your individual situation. The one thing that all the experts agree people tend to underestimate – healthcare. Particularly if you are spouse gets very ill or disabled (if we live long enough, we will), expenses will go up instead of down. My point – estimate on the side of caution.

    by John Brady — October 3, 2012

  5. Where I live in the current economic decline, we say “retire while you can!”: before sequestration hits in January and people are laid off. I am taking the VER [voluntary early retirement] tho I’m only 53, while there is still a pension to take. And it also frees up my position so those junior to me can keep their jobs to support their families.

    Be sure you have Inexpensive hobbies and pastimes.

    Even tho we haven’t paid off our mortgage, we are renting out our condo and will be RVing while we have our health.
    As for Healthcare – there isn’t any because it’s unaffordable whether you pay it yourself or are taxed for it. We’re all going to die. Life is fatal. So there’s no point going into debt over it.
    Ultimately, God is in control: follow Him and He will provide peace. [Deut. 26]
    Blessings, Elaine

    by Elaine — October 3, 2012

  6. I found this article to be excellent. I will be 62 in January, and I am planning to retire from my state job. I am one of the fortunate people who will have health insurance as part of my state retirement. I do not plan on participating in social security until I am 70, though. I am planning to retrain at a local community college for a career as an occupational therapy assistant. My job with the state is excellent on many levels, and I am very grateful that I was able to work until I could retire; however, it has not been a very satisfying career. I want to have a different career experience that will let me keep working into my 70’s (part-time) if I want and need to.

    I had an epiphany a little over a year ago when I used the longevity calculator at the social security website. I was stunned to learn that I could live well into my 80’s. I realized that I had to re-think everything about how long I would work, and what I would be doing. I have been divorced for many years, and as of two years ago, I live with my daughter, son-in-law and my two grands. While this works on many levels for all of us, I do not want this as my permanent living situation. Basically, I am trying to reclaim a mindset I had in my 50’s and keep it going through my 60’s.

    This article comfirmed for me that I am not ready to retire because I still want to work. In another Topretirements article, an interview with Nan Cullinane about her book for women who are retiring as singles, I realized that I fit many of the demographics she talks about. While I have worked since I was a teenager, (I have only one year since 1969 when I did not make enough to pay into the social security system), I was a stereotypical female employee. For intstance, I worked temporary positions with the state (of North Carolina) for years before I became a permanent employee. After my divorce, I worked two jobs and went back to school. Thus, while I have worked a lot, I do not have much to show for it at this point in my life. I definately want to maximize my social security benefit by working longer, and I do have 401(k) savings, but not enough to last into my 80’s. Fortunately, my health is very good, and I am excited about making a career change.

    Occupational therapy assistants are nationally licensed, so I will be able to work in any state. As many years as I have spent in North Carolina, I plan on living out west–I just can’t adjust to high humidity–or high dew points. I was raised in the Central Valley of California, and I have traveled extensively in New Mexico. My sister, who lives in Redding, CA, and I will be exploring Reno, NV over the Thanksgiving holiday this year. I am learning that I have to maintain my curiousity about life and keep involved with my interests, while developing a new career path to reverse the traditional retirement mindset I had when I thought that I would be lucky to see 80 years of age–much less 85+.

    I have many friends who have retired and who think that I am being overly cautious. This quiz has helped me to have confidence in my decisions about retirement and and about establishing a new career plan. If anyone has any thoughts about living in Reno, NV, I would love to hear them.

    by Nancy — October 4, 2012

  7. I think it’s definitely important to evaluate how you are going to spend your time after retiring. If you don’t have extracurriculars or hobbies or travel plans, you’re going to be wishing you had a job still.

    by Oakmonte Village — October 30, 2012

  8. Retirement is within a couple of years and we will be wanting warmer seasons to live in. We live in Iowa and are ready for a change. For the last several years we have always thought that Florida is where retirees mostly go. My husband and I have always loved the look and feel of Florida but in the wake of this monster storm that just hit the eastern seaboard (even though Florida was spared this time)we are rethinking that maybe Florida is not for us.The personal testimonials say that evacuating your home to avoid an impending storm is not something one wants to ever experience and the summers are brutal in Florida. We know we do not want to own two places to avoid the storms and extreme heat so one place to relocate is for us. It would be ideal to live in driving distance of the ocean but far enough away to avoid storms. I have been looking at North Carolina thinking it looks as though it seems to come pretty close for the most part of having it all….ocean access, mountains, mild seasons. Is there anyone out there that has lived in either of the Carolina’s and could direct us toward a city that has lots going on for seniors. But also a big enough city that is stimulating yet not so large that it is impossible to get around to the events. We absolutely do not want a college town…been there…done that. We lived in a town that was dominated by a large population of college students and we would prefer not to do that again. We have never been to North Carolina but from what I have been reading the state looks just beautiful. Does anyone have any suggestions as to where to begin looking in North Carolina? Thanks. Linda.

    by Linda Christianson — October 31, 2012

  9. NC: I lived in Chapel Hill and Wilmington NC (not retired). Obviously CH would not work for you. Wilmington might. It is on Cape Fear River and close to ocean…across river in Leland might work. I personally did not like living in Wilmington, but most love it. I actually had sore hurrican damage in Chapel Hill but never in Wilmington. Did lose electric for a miximum of 3 hours once in 8 years that I lived in Wilmington, but as you know storms are very unpredicable.

    by Elaine — November 1, 2012

  10. Linda, we have thought about Florida too, but as you said summers are brutal.Central Florida may be sheiled from hurricanes as eveidence by more favorable insurance rates, but then the heat and humidity are unbelievable. Atlanta is a nice area. I worked there for a month about a year ago. Lots of events, good public transportation system and mild climate, along with a decent tax structure and reasonable cost of living. Carolins may be nice too.

    by MARK — November 1, 2012

  11. Thank you Elaine and Mark for your thoughts. I have since re-thought my(our) feelings about not living in a town/city that had a college or university in it.After reading much about NC towns that do have colleges in them the towns seem large enough that maybe being surrounded by college students would not be such an issue. We lived in a small community with 30,000 residents plus 28,000 college kids.It was too much one-on-one after twenty-five years of it. But looking at Raleigh and Charlotte I am thinking one of the two places or even near-by communities would be most desirable and the large student population would be mostly insignificant. Does anyone have any thoughts or could give me a perspective…pros/cons about Raleigh/Charlotte? They both seem to have a lot going for them. Not that conservative vs liberal is a huge factor but it would be more favorable to us to live where residents are mostly political conservative. Would appreciate hearing from anyone that has lived in either Raleigh or Charlotte. Thanks much. Linda

    by Linda Christianson — November 2, 2012

  12. We bought property in NC Southport area years ago. We loved the area and planned our retirement there. Now that the time has come, I am getting cold feet about leaving the area and home we have lived most of our adult life.
    I think that this is a normal reaction to change. But would love to hear from someone who has made to the otherside …

    by Patti — November 15, 2012

  13. Elaine, you mentioned you did not like living in Wilmington but you did not say why. My husband and I are thinking of relocating in the Carolina Forest area in Myrtle Beach, South Carolina. Is anyone familiar with this area?

    by Lynn — November 16, 2012

  14. Lynn, I am a minority! I was working. I do not tolerate the sun well so being close to the beaches wasn’t much of an offsetting factore for me. Mostly, I found the people unfriendly it might be different if you are married. I also think it might be different in Leland across the Cape Fear river in one of the newer adult communities.

    by Elaine — November 16, 2012

  15. Linda, Although I loved living in the Chapel Hill area, I would not retire there either…but nearby might work and I know that it wouldn’t work for you, it is definitely a college town. I will consider the Raleigh area after some additional exploring, I was close enough to know that it has much to offer. I do not know much about the Charlotte area, but linke Linda, I would love to hear about both Raleigh and Charlotte from others. But you are right about a larger city with a college is nothing like a college town and for me is the best of both worlds. As someone mentioned to me the CH community is integrated with the college, but Durham with Duke is not…Durham is very different from CH. Raleigh is a real city with colleges so as you explore other cities in NC, keep us updated.

    by Elaine — November 16, 2012

  16. Patti: We have not even bought property in another state as you have and we are still three years out from retirement and the thought of moving seems undaunting also. We have always said we want to leave these Iowa winters behind but moving to a place where we know no one seems overwhelming.Our kids are in Minneapolis and Boston and neither of those seems to be the place for retirement as far as the weather goes.We have never been to NC but have read lots lately and it seems to be a very appealing place.We use to think Florida would be the place but “no thank you” to the hurricanes and the whole evacuation process.There seems to be many places in NC to live that one can escape the severe weather.Looks as though Southport is right on the ocean.We too love the ocean but for us the weather threat keeps us away from thinking about living quite as close as Southport seems to be. Tell me about Southport if you would.We are in Des Moines…are you in a state that has winter/snow too? I too would like to hear from others that have just packed up and thrown caution to the wind.

    by Linda Christianson — November 18, 2012

  17. Linda .. Southport area is very nice. We have bought into a golfing community that offer many activites besides golf as I am not a golfer but huppy is. So hoping that this will open an avenue to meet new people. You are close to major city (Willmington) as well which is important. Worth a visit or internet research. One day I am ready to pack up and leave .. next day I want to stay put. We are currently living in Northern Virginia and do get snow and cold weather. This area of NC will give us a couple more months yearly of more moderate climate.

    by Patti — November 20, 2012

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