When to retire is one of those sticky questions. It’s financial. It’s psychological. And sometimes it’s out of our control.
The idea of stepping out of the workforce in your mid-60s with possibly three decades of living in retirement ahead is unnerving, especially when it comes to your future financial security.
“Money is part of it, but there are many dilemmas that people grapple with as they’re trying to make this decision,” Teresa Amabile, a psychologist at Harvard Business School and co-author of the new book “Retiring: Creating a Life That Works for You,” told Yahoo Finance.
They may want to retire because there are other things they want to spend more time on, or work has become more of a grind, or they don’t like the direction the corporate culture is going, she said.
A growing number of workers, in fact, are facing this decision. This year, a record number of Americans are turning 65 — about 4.1 million — and the rush will continue through 2027.
Sixty-five is commonly considered retirement age, most likely because that’s when Americans are eligible for Medicare. For someone who has been clinging to a job for the health insurance coverage, it’s the green light to hit the exit.
Everyone’s situation is different, but there are factors beyond the big ones — how much money you have saved for retirement and whether you have health insurance — that can make the decision less of a hand-wringer and help you avoid feeling pressured to step down, Amabile said.
“For most people, from the president of the United States on down, the ideal scenario is to exit when you want, how you want,” she added.
Read more: Retirement planning: A step-by-step guide
Here’s what Amabile had to say about all that and more in a conversation with Yahoo Finance’s Kerry Hannon. Edited excerpts:
Kerry Hannon: Why is it so hard for many people to make the decision to retire?
Teresa Amabile: For people who have identified closely with their work, to leave it behind isn’t easy without losing a sense of purpose. Even people who didn’t believe they identified really closely with their work worry about finding something meaningful to do with themselves after they retire.
Another reason it can be hard for people to step out is people respect you while you’re working. It’s a sense of pride. If you don’t find real meaning in just the ordinary thing you’re doing in your life, it can make getting over that hurdle really tough.
One key factor to getting retirement right is “alignment” you write. Can you pull that apart a bit?
People who have a smoother transition into retirement, and who end up more satisfied in their retirement life, tend to have alignment — achieving a good fit between who they are and their life structure.
