Once upon a time, the American dream meant owning a small piece of land with a house and picket fence, taking a modest vacation in the family sedan, and saving enough money to send your children off to college. How times have changed! For the millions of baby boomers - people born in the United States between 1946 and 1964 - the American dream has shifted dramatically and, for most, points to one goal: retirement. But how do you know when it's time to leave the work force? And, more importantly, are you really ready? Here we look at five signs that suggest it may be time to leave the working world behind for good.
1. You Can Afford It
The biggest question one asks before retiring is, "Can I afford it?" If you've planned well, your house is paid off and you have little or no outstanding debt. That's a great start, but will you have enough to live comfortably during your retirement years?
Most banks and financial institutions provide retirement calculators to help put money issues in perspective. They take into consideration aspects such as your age (and at what age you'd like to retire), current savings and income (including expected rate of return for investments, pensions and Social Security benefits), current and anticipated expenses, and estimated inflation numbers.
When all is said and done, conventional wisdom estimates that retirees will need well over 50% of their current annual income to live at the same or a similar level as when they were working.
2. You Feel Ready
Retirement is not only about the finances. But people who think they're ready to retire, or just feel that they should, can end of regretting the decision if they haven't spent time thinking about it, adjusting to it and accepting it. For those who are still enjoying their work and may regret leaving it. As you approach retirement, recognize that the decision to end your career has many implications that go beyond money. Make sure you're ready to take that leap.
3. You're Making New Plans
Once you retire, it doesn't mean you suddenly don't do anything. Before you're ready to retire, you'll need to make plans to fill your time once you leave the workforce.
Is a community organization or charitable cause calling your name? Do you find yourself spending just as much time in volunteer activities as in your job? If so, this may be a signal that you're ready to leave the workforce and take up more philanthropic ventures.
Volunteering, which may consist of any service from helping in a food pantry to coaching your grandchild's soccer team, is a wonderful way to stay involved, feel productive and engage in activities that there simply wasn't time for when working full time. More than 63 million Americans volunteered in their communities in 2009, contributing approximately 8 billion hours of service.
4. You've Developed a Wanderlust
Many of us would love to "see the world", but travel is often curtailed by a busy work schedule or other obligations such as raising a family, paying a mortgage, etc.
Now that the kids are grown and you've paid off those major bills, that cruise in the Mediterranean or excursion to the Great Wall is a definite possibility. If the "pros" have outnumbered the "cons", it's time to call the travel agent. And why not? You've earned it.
5. You're Ready to Relax
"Chill out" was the mantra for the '60s generation. Maybe you find yourself revisiting that notion more often than you used to, and are finding that some of the things that you've always wanted to do (such as read "War and Peace") are tugging at you harder than ever. When your to-do list includes things like taking a nap every afternoon, starting a vegetable garden or going to a ballgame or movie with your grandkids, it may be time to pack up your stapler and start the next chapter of your life.
The Bottom Line
Leaving the workforce is not easy for everyone. For some, it may never be an option. But if your priorities have changed, your finances allow it and your heart drives you in that direction, then you're probably ready for the "Big R."
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