The Retirement Corporation of America

When Do You Want To Retire?

The key to how much it will cost you to live in retirement depends on the number of years you draw from your retirement finances and nest egg.

Life spans are growing progressively longer, and medical breakthroughs are likely to extend them still more. A sound rule of thumb is to assume that:

• If you are over age 50 now, expect to live until you are 90.
• If you are under age 50 now, expect to live until you are 100.

The phrase that fits perfectly is: Better safe than sorry. In other words, plan for a long life, and budget your money accordingly. At worst, you and your spouse will leave some of your retirement savings unspent.

The alternative is to still be around after the last of your money has run out. The burden of caring for you will then fall upon your children.

The one variable in estimating how long your retirement will last is deciding when you actually plan to retire. You won't always have the final word on that. Your employer could force you into early retirement—or offer you such an enticing separation package that you can't say "no."

Your job could end prematurely—through cutbacks and layoffs, or because your employer's company was acquired by someone else. You may not be able to find a job—at least not one that appeals to you—so you decide to retire early.

Even under such circumstances, you do have the option of retiring, or taking a job to supplement your income. Unless the ax falls earlier than you expect, the decision on when to retire is pretty much up to you.