I've written many articles before designed to help readers identify their ideal retirement age. And it's not uncommon for folks to attempt to nail down a specific retirement age to work toward.

But here's the problem with that approach: While there are certain key ages for workers to know about (which we'll review in a minute), trying to determine the right age to retire when you're younger is a bit like narrowing down exactly what you want to have for dinner three weeks from today. Maybe you'll be in the mood for Italian; or perhaps you'll end up craving sushi. Though it's a good idea to have a general sense of when you want to retire, focusing on the age itself isn't necessarily the best approach -- because you never know how your finances are going to look, and how you're going to feel, once that age arrives.

Senior couple hiking


Key retirement milestones to know about

When we talk about retirement, there are certain key ages that tend to come up as part of that discussion:

  • 59-1/2 is the earliest age you can take penalty-free withdrawals from a traditional retirement account, like an IRA or 401(k)
  • 62 is the earliest age you're allowed to claim Social Security
  • 65 is when you're eligible for Medicare
  • 66 is your full retirement age for Social Security if you were born between 1943 and 1954
  • 67 is your full retirement age for Social Security if you were born in 1960 or later (if you were born between 1955 and 1959, your full retirement age is somewhere between 66 and 67)
  • 70 is when you'll stop accruing delayed retirement credits for holding off on Social Security.
  • 70-1/2 is when you'll need to start taking required minimum distributions from your traditional IRA or 401(k)

Now that you know the significance of the above ages, let's talk about why it may very well be that none of them are the right time for you to retire. As you probably know, many of the expenses you incur during your working years don't go away in retirement. Once you stop working, you'll still need a roof over your head, a means of transportation, food, clothing, and the like. And while some of these costs might drop later in life, you may come to find that other expenses of yours go up.

Take healthcare, for example, which, according to recent projections, will cost the average healthy 65-year-old couple today $400,000 or more throughout retirement. Then there's leisure. Though it's certainly not a necessity, once you're retired and have oodles of free time on your hands, you'll need a means of occupying it. It therefore stands to reason that you may spend more on entertainment as a senior than you did during your working years.

The point here is that retirement costs money, and while Social Security can help cover some of your expenses, your benefits will only suffice in replacing roughly 40% of your pre-retirement income. Most seniors, however, need a minimum of 80% of their former earnings to pay the bills, especially when you factor long-term care into the mix.

It's easy enough to say that you'd like to retire at 65, or 67, or whatever age you feel works for you. But the fact of that matter is this: If you haven't saved enough by that age to cover your senior living costs, it's not the right time.

A different mindset

While a big part of being ready for retirement boils down to money, there's a mental component as well. Going from working full-time to being completely obligation-free is a huge adjustment, and it's not one to take likely. You might think you'll be ready to leave the workforce behind at, say, 66, but what happens if at that point in your career, you're still enjoying what you do and managing your routine just fine? Does it really pay to retire, in that case, even if you can technically afford to do so?

While it's a good idea to map out a plan for retirement, and think about when you might pull the trigger, rather than get hung up on a specific age, it pays to focus on your financial and emotional readiness. In other words, think about how much savings you'll need to retire comfortably, how you'll spend your time, and at what point you think you'll be ready to leave your career behind you. And then, once you're in the right position to check all these items off your list, go ahead and retire, whether you're 63, 73, or 83.

Of course, you'll want to keep the above milestones in mind, because they could have financial implications that help or hurt you in retirement. For example, retiring and then filing for Social Security at age 62 will slash your benefits, and it'll also mean no Medicare coverage for three years. But as long as you understand the consequences of retiring at various ages, you don't necessarily need to set one in stone.