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Choosing when to retire is one of the biggest decisions you’ll ever make. Retiring at certain times of the year may be more advantageous than others, but ultimately it’s a very personal decision, and one that you can decide is the right time and when you are financially ready. When should be done.
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That said, GOBankingRates spoke to several retirement experts about whether they think there’s a perfect day of the year to retire and what you should consider when making your decision. Ta.
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Maybe the end of the year is best
When it comes to retirement, the day of the week may not be as important as the time of year.
“There’s no one-size-fits-all answer, but retiring at the end of the year can be beneficial for several reasons,” says Tyler Meyer, CFP, founder of Retire to Abundance. “Firstly, you may be able to maximize your annual benefits, such as bonuses and employer contributions to retirement plans. Also, retiring at the end of the year will give you more clarity on your annual gross income. You may be able to delay receiving distributions from your retirement account until next year, allowing you to better plan your taxes.”
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Warm weather can be ideal (for some)
If you don’t want to wait until the end of the year, the warmer months are also a good time to retire.
“Spring and early summer are considered the best times to retire,” Meyer says. “The weather is generally better, making the transition to retirement more enjoyable.”
On the other hand, some retirees may want to wait until winter if their goal is to continue earning until they can go out and enjoy winter and holiday-related activities. This year’s first day of winter is December 21st.
There are also benefits in the middle of the year.
But for some people, retiring mid-year offers tax benefits that can’t be ignored. In this case, it might be better to choose a day in the middle, perhaps around June 1st.
“Retiring mid-year allows you to spread your income over two tax years, which can help you manage your tax brackets and potentially reduce your overall tax bill,” Meyer says.
An important personal date may be best for you
Just like weddings and other big life events, sometimes the best day of the year for retirement is simply one that has personal meaning to you.
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“I don’t think there’s a specific day of the year that’s a good time to retire,” says Michael Collins, CFA, founder and CEO of WinCap Financial. “Some people may choose to retire on their birthday or other important day, but ultimately the timing should be determined by your own circumstances and goals.”
Retire when you are financially ready
Many experts agree that there’s actually no perfect day, or even perfect month or season, to retire. Instead, it’s important to choose a date that fits your financial preparedness, wants, and needs.
“The best time to retire is when you’ve thoroughly evaluated your financial and emotional preparedness, rather than just focusing on a specific day or month,” Meyer says. “Consider factors such as your own health, your spouse’s retirement schedule, and upcoming major life events. Once you feel confident that you have a sustainable financial plan that supports the lifestyle you want, , please resign.”
Ask yourself what retirement means to you
For some people, retirement means leaving the workforce forever and achieving the ultimate financial freedom. For others, it’s a little more subtle than that. Before you make a big decision, you’ll want to know what retirement means to you.
“What does it mean to retire? Have you simply reached a stage where you can afford to retire, or do you feel you have no choice but to retire from public and professional life? This question The answer to that is going to be very subjective,” said John Gillet, financial planning expert and CEO and founder of the Gillet Agency.
“Everyone is different,” Gillette says. “Speaking for myself and some of my clients, it seems like there’s a need to stay purposeful. And for some, that means working in a field they love and having a sense of contribution. .”
In the end it’s up to you
Choosing when to retire ultimately comes down to you and how ready you are for the next big step in your life. For some, the tax benefits of retiring mid- or year-end may be a major factor in their decision. For others, it’s important to choose a date that has personal meaning, whether it’s Sunday or Thursday.
“My advice for choosing the best time to retire is to carefully assess your financial situation and personal preparedness,” Collins said. “Before you make a decision, consider factors such as your age, savings, health, and future plans.”
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This article originally appeared on GOBankingRates.com: Is there a perfect day to retire? Experts explain
