Five Signs It's Time to Retire in 2025
Over 4 million people will reach 65 this year, ushering in what is expected to be a wave of retirements. Should you join them in retiring in 2025?


What are the signs it's time to retire? If you've been thinking about retiring in 2025 but are not sure if you should make the leap, you're not alone. More than 4.1 million Americans will turn 65 this year, which could translate into over 11,200 Americans exiting the workforce on a daily basis.
Turning 65 is a big deal. You can collect more of your Social Security benefits, plus you don’t have to worry about any penalties if you draw down on your retirement savings accounts. Not surprisingly, with so many people turning 65 this year, talk of retiring in 2025 is sure to be a topic of conversation on the golf course or at the dinner party.
Why is retiring in 2025 a good idea?
For many older adults thinking of making the retirement leap, there are several reasons why retiring in 2025 is attractive. For starters, stocks have had a more than two-year bull run, which has padded the retirement accounts of many Americans. As of the third quarter, the average 401(k) and 403(b) account balance increased about 23% year-over-year, setting a new record, according to Fidelity Investments.

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Bond yields are also attractive as the Federal Reserve has started to cut interest rates which means more income in retirement. Meanwhile annuity rates are better than a few years ago when interest rates were near zero. That may not last if the Fed cuts rates aggressively. Then there’s the potential for President Donald Trump to eliminate taxes on Social Security, something he vowed to do on the campaign trail. Currently, up to 85% of Social Security benefits can be subject to federal tax, depending on a taxpayer’s combined income.
5 signs it's time to retire in 2025
Still on the fence? If any of these five signs ring true, 2025 may be the year you trade the daily grind for a more relaxed lifestyle.
1. You are emotionally ready. For many of us, our sense of purpose and value is wrapped up in our jobs. We spend 40 or more hours a week working, so it makes sense that it’s a big part of who we are. But if you give that up, how will you feel? Will you be ok or will you feel disconnected or even fall into a depression?
“So much of our self worth and well-being is in our occupation,” says Scott Bishop, managing director at Presidio Wealth Partners. “If you retire today, what does Monday look like?”
If you have no idea what you'll do with all your newfound free time or trying to figure it out overwhelms you, it may be better to give your post-work life some more thought before retiring. After all, people who are ready to retire usually have a plan as to what they will do when they stop working full-time. But if you are excited about life outside of work, then a 2025 retirement may be right for you.
2. You saved enough. One of the reasons people work longer than planned is because they don’t have enough cash saved to cover their lifestyle in retirement. With it potentially lasting thirty years, that’s a lot of money to amass. But if you did your job and saved enough to live comfortably in retirement then exiting the workforce is much easier to do. To ensure you have enough, Bishop says to identify all of your sources of retirement income, tally your budget requirements, consider hobbies, travel and unexpected medical expenses and see if your savings, factoring in inflation, are enough to achieve your retirement goals. While everyone's situation is different, a recent Northwestern Mutual study found Americans think about $1.5 million is the magic number to have in the bank to live comfortably in retirement.
“It’s not about a retirement number. It’s what you and your family need to do what you want in the next period,” says Bishop.
3. You have a post retirement plan. Whether you plan to work, consult, pursue a hobby or volunteer, people who are ready to retire have a plan in place as to how they will spend their time. They understand that there has to be a purpose, a reason to get up and get dressed everyday, and without it, their mental health may suffer. That’s common in retirement. A WebMD survey found nearly one in three retirees in America said they feel depressed, which is a higher rate than the overall adult population.
That’s why it’s important to know what you want to do in retirement beyond saving a lot of money. “If you retire and don’t have a hobby or schedule, you can go into a depression,” says Erika Wasserman, a certified financial therapist and CEO of Your Financial Therapist. “All of a sudden what you were doing for 30 years drastically changes.” Before you make the leap, make sure you come up with a plan and a daily schedule for how you’ll spend your time, says . Wasserman
4. You can handle your bank account depleting. We spend decades amassing money, watching it grow and compound. But if the idea of watching it dwindle, which it will in retirement as you withdraw some of your savings, keeps you up at night, you may not be ready to stop collecting a paycheck. After all, you don’t want to retire and embrace a frugal lifestyle because you don’t like seeing your balance go down. “If you are not ok, ask yourself why,” says Wasserman. “Explore those feelings and determine what would be comfortable at this point in life. Maybe it's not full retirement, it's partial retirement for a couple of years.”
5. You talked to your spouse. Retirement isn’t a personal decision if you are married, it's a joint decision that should be discussed often in the lead up to retirement. After all, your retirement will impact your spouse both financially and emotionally. “Many married couples find the first few years of one or both spouse’s retirement a period of rough transition,” says Bishop. “If you haven’t discussed your plans with your spouse, you should do so; think through what the repercussions will be, positive and negative, on your roles and your relationship.”
Bottom line
Retirement means different things to different people. Some people have been planning and preparing for years with a clear retirement date in mind. For others, it’s less etched in stone. But either way, if you are thinking about retiring in 2025, make sure all the signs are pointing in the right direction.
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Donna Fuscaldo is the retirement writer at Kiplinger.com. A writer and editor focused on retirement savings, planning, travel and lifestyle, Donna brings over two decades of experience working with publications including AARP, The Wall Street Journal, Forbes, Investopedia and HerMoney.
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