Decisions surrounding when, why, and how you retire will be very personal and largely depend on your individual circumstances. They’ll also be influenced by external factors such as the rising State pension age and the impact of the recent pandemic on the job market.
If you’re thinking about retiring in the next few months or years, chances are, you’ll have plenty to consider before you do. You might also find yourself wondering whether retirement is the right choice for you at all.
This is especially true as research shows one in three people are now planning to work beyond the State pension age, and because many people who retire later decide to return to the workforce.
When considering your retirement options, it can be a good idea to put together a plan in the months or years leading up to your retirement to help you confidently navigate this new life stage.
One of the key considerations (and rightly so) that most people make before they retire is whether they can afford it. However, the emotional impact of retirement is also incredibly significant, as the process typically involves closing one life chapter and beginning a new one.
For some, the contents of this next chapter might already be clear. But for others, the road ahead can be foggy, and they might experience a loss of purpose and identity.
The important thing to remember is that there are no right or wrong answers when it comes to deciding when or how to retire. At one time, retirement was seen almost exclusively as a chance to wind down, and people tended to stop working at the retirement age set out by their employer or the State.
While many people are still choosing to retire at the State pension age, others are using their retirement period, not necessarily as a chance to slow down but as an opportunity to try something new. For example, to make a complete career change or to start their own business venture.
Some people also choose to retire in stages, which might begin with working part-time hours or committing to new opportunities that offer more flexibility and freedom.
Below, we’ve put together a list of nine key things to consider if you’re thinking about retiring. Hopefully, they’ll help you explore and write your own definition of retirement, and make the most of whatever comes next.
9 things to consider when you’re thinking about retiring
1. When can I afford to retire?
Before you decide to retire, unfortunately, it’s necessary to consider whether you’ll have enough money to live off – not just at the time of retirement but in the months and years that follow.
During complete retirement, people usually lose their main source of income and will need to make sure that they have enough income from other sources (such as pensions, investments, and savings) to supplement this.
If you want to find out how much you already have in your pension pot, how much you’ll end up with if you stick with auto-enrolment contributions under your employer’s workplace pension scheme, and how much you need to save for retirement, it’s worth having a read of our article; How much should I save for retirement?
In addition, our article on how the State pension works has more information about the type of State pension you’ll get, when you can start receiving it, and how much you’re likely to have.
If you’re considering early retirement, it’s also a good idea to learn more about when you can access your workplace or personal pensions, and how when you stop working can affect how much you get in retirement.
Have a read of our article, How to manage the impact of early retirement, to find out more. Or, for more pension information and tips on financial planning in the lead-up to retirement, you might want to visit the money and finance section of our website.
If you’re considering getting professional financial advice, Aviva is offering Rest Less members a free initial consultation with an expert to chat about your financial situation and goals. There’s no obligation, but if they feel you’d benefit from paid financial advice, they’ll go over how that works and the charges involved.
2. How will I fill my free time if I decide to retire from my job?
When you’re thinking about retiring from your job, one of the most important things to consider alongside your finances is how you’ll fill your free time.
Research shows that people can spend the first few weeks or months of retirement enjoying a well-deserved break from working life – only to become bored and restless after that initial period has passed.
Once the novelty of having lots of free time has worn off, it’s natural that you might find yourself looking for new ways to add meaning and purpose, and wondering what you’re supposed to get out of bed each day. Some people also say that they experience a loss of identity during retirement and feel unsure of their role in this new chapter.
To make sure you maintain a sense of purpose throughout retirement, it can be a good idea to work out what you plan to do with your free time early on.
For example, will you be helping out more with the grandkids, looking to start your own business, or learning some new skills? Perhaps you’ll be dedicating more time to your health and fitness or exploring activities you’re passionate about on a deeper level.
Maybe you could also start by thinking about what you do with time off work at the moment. What would you normally do in a typical week off? Do you usually find that you’re bored and ready to get back to work by the end of your time off? If so, you’ll probably need more of a plan in place before you’d be ready to retire fully.
Generally speaking, it can be useful to over-plan rather than under-plan, so that you always have something to keep you busy should you want it. Remember, you can just as easily cancel plans if you need some downtime.
If you’re unsure how you want to spend your retirement, or even whether you’ll enjoy the things you plan for yourself, it’s always worth giving yourself a few different options. That way, if your initial plan doesn’t work out, you’ll have something else to focus on.
3. Am I happy with my life right now?
A simple way to decide whether retirement could be right for you is to consider whether you’re truly happy with your life right now.
Do you enjoy your job? Do you love going in and seeing your colleagues every day? Is your role bringing real value to your life? What are the physical implications of your job? Does it leave you feeling run down and tired? Or does it help to keep you active?
How you answer these questions can be an important part of helping you to decide whether you really want or need your life to change right now, and what your reasons for retiring would be. It can also help to identify areas of your life that you feel need improvement and decide whether retirement is the best solution.
For example, if you love your job and would be sad to give it up, but you’re regularly feeling burnt out, then perhaps you could have a conversation with your manager about cutting down your hours or hiring some more team members if you’re short-staffed.
Or, if you don’t enjoy your job role but look forward to the interaction with colleagues, customers, or clients, you could explore other volunteering or career opportunities instead.
It’s also possible that your job doesn’t leave you much time to concentrate on other areas of your life, like spending time with family or engaging in a particular hobby. In this case, you might want to use your retirement period to focus your energy on these things instead.
As well as considering whether you’re happy with your life and job right now, it can also help to think about what could make you even happier long-term. Nearly all of us have goals, passions and interests, so it’s important to think about how we can leverage these and whether your retirement period could help with this.
4. How does the idea of retirement make me feel?
It might sound obvious, but how you feel when you think about retirement can often be a key indicator in deciding whether retirement is a suitable option for you at this stage in your journey.
If you feel excited or relieved when you think about retirement and have lots of different things you’d like to do with your time, this could signal that perhaps, it would be a positive and fulfilling move for you to make.
On the other hand, if you know that you don’t want to carry on working, but the thought of retirement fills you with dread – perhaps due to fears of being bored or isolated – it’s likely that you could benefit from spending more time planning your retirement period and shaping it into something that’ll be meaningful for you.
If this sounds familiar, perhaps while you’re still working, you could focus on taking steps outside of your comfort zone by trying some new activities or meeting new people.
Making sure that you’ve built some solid foundations for a life outside of work can help you to feel more confident about retirement and allow you to feel excited about the prospect of giving more time to these areas of your life.
Some people find it helpful to drop down to part-time hours first, before giving up work altogether. This can help them adjust to retirement more gradually.
It’s also possible that the idea of stopping work just doesn’t feel appealing because you enjoy what your job brings to your life. In which case, there’s nothing wrong with continuing to work beyond the State pension age.
5. What’s my retirement lifestyle going to be like?
Our work and general lifestyle are often closely linked, so it’s worth considering how your lifestyle might change if and when you decide to retire.
For instance, if you currently work in a very active job, how will you make sure that you continue to stay active during retirement? Or if you enjoy having a daily routine, then how will you create a new routine for yourself that’ll add meaning and purpose to your life?
If you’re sociable, it’s important to consider how you’ll keep up contact with others when you retire from your job.
For example: do you have clubs or classes you’d like to join? Do you have other retired friends who you can spend time with? Would you benefit from a part-time job or voluntary role that would allow you to continue mixing with people while giving back to the community?
For anyone in a relationship, it’s a good idea to think about how retirement could affect the dynamics of daily life with your partner. Is your partner retired too? And if so, how will you be sure to give each other space now that you’re not both going to work every day?
If you’re unsure what you want your retirement lifestyle to look like, you could try creating a vision board of what you want it to look like. This can help inform and guide your decision over whether to retire, as well as the retirement planning process.
6. Where will I live?
Many of us base decisions on where we live around our work. For example, perhaps you’ve always lived somewhere that allows you to be within easy reach of your workplace – either on foot, by car, or by train.
And maybe you’ve had to compromise on the size of your home due to needing to live in an area where property prices are high.
But planning for retirement also means considering where you might live during this next phase of life. If you’ve always dreamed of living by the coast, but your work commitments prevented it, why not use retirement as an opportunity to take the plunge? Or, if you’re keen to retire but know that you’ll have to downsize to afford it, where would you move to instead? Would you be happy living in a smaller place?
If you’re planning to retire completely, it can also be beneficial to live in an area where you’re within close reach of friends and family, or where there are things going on relevant to your interests. Having a support network can make it much easier to remain active in society, which is important for both mental and physical health.
For some ideas on where to live if or when you retire, you might want to check out our articles; 14 of the best places to retire in the UK and 7 benefits of living in a retirement community.
7. What’s most important to me, and how can I prioritise this when I retire?
“Imagine what your future could be, seeing in your mind a future bigger than your past.”
It’s really important to see retirement as your time. Perhaps you’ve given many years to raising a family, working in roles you’ve not particularly enjoyed to make ends meet, or doing things you ‘should’ do rather than what you want to do.
When thinking about retirement, you might want to ask questions like: what exactly do I want from this new stage of my life? What would be best for me? And how can I make sure that I find satisfaction and enjoyment in whatever I do next?
Thinking this way will help to make sure that any retirement decisions are entirely led by you and designed to guide you along a path that leaves you looking forward to what’s coming next.
In an interview with Rest Less, author John D. Anderson told us that he wants people to see that it’s possible to make the second half of your life even better than the first by creating a purposeful, rewarding, and inspired plan.
He says, “We aren’t limited by our abilities, but by our vision. Imagine what your future could be, seeing in your mind a future bigger than your past. Write out your vision in as much detail as possible. Then, I would recommend sitting down with a journal and thinking through how you can get to where you want to be.
“If you’ve got something that you want to achieve, then it’s about finding the process that’ll take you there, executing it well and repeating it until you start seeing the results that you want. When I was younger, I didn’t value the power of process as much as I do now.”
8. Would I be retiring because I want to, or because others are putting pressure on me?
Many people still believe that a person should automatically retire when they reach the State pension age, but this won’t be right for everyone. Only you’ll know if or when retirement is right for you, so it’s important not to let the opinions of others cloud or sway your decision.
For instance, if you want to continue working but are receiving input from family and friends that is trying to convince you otherwise. While it’s worth taking into account the opinions of those who care about you, try to remember that the final decision is yours and you have every right to carry on working if you want to.
This can be particularly true if you’re thinking about making a career change when you’d traditionally be set to retire. It’s natural to wonder what people might think or say about your decision; but ultimately, it’s important to do what works best for you.
If you’re not sure which way to turn, you might find our article, 8 powerful questions to ask yourself when you arrive at a crossroads in life, helpful.
9. Is the timing right?
Knowing whether the time is right to retire will often rely on the financial, practical, and emotional side of things all coming together. It’s important that you feel happy and fulfilled in your day-to-day life while being able to cover all the necessary expenses.
If these things aren’t quite in sync, then you might just need more time to plan and get things in order.
Or, if you find that you never feel ready emotionally when you put serious thought into retirement, there’s also no need to put pressure on yourself.
It’s easy to underestimate the emotional impact that retirement can have on a person’s life. But the reality is that it’s a huge change that can take some getting used to, and it also might not be right for everyone.
Some people also change their minds about retirement after a few weeks, months, or years, and decide to go back to work. Again, this is perfectly okay, and it’s all part of your personal journey. We spoke to Dee Flower, who decided to rejoin the workforce after retirement at age 68 – you can read her story here.
Final thoughts...
If you’re thinking about retirement, you might have lots of questions buzzing around your mind about whether it’s the right move for you – and if it is, then when and how? We hope that this article has helped you narrow down some of these questions so that you can see things a little clearer.
With so many options for what you could do with the next phase of your life, it can help to start by focusing on what you want to do. What would bring you fulfilment? And who do you want to be in the next chapter of your life?
"Retirement is a blank sheet of paper. It is a chance to redesign your life into something new and different."
Are you thinking about retiring? Have you swapped retirement for a career change? Or perhaps you’ve already retired – if so, how do you fill your time? We’d love to hear from you in the comments below.