Some people are forced into retirement, but for many Americans, the choice of when to leave the workforce is theirs to make. If you're of a certain age and are thinking of bringing your career to a close, you may be wondering whether the time is right to retire. But if any of the following apply to you, take it as a sign that you're probably not ready.

1. You have no idea how much annual income your savings will buy you

As retirement nears, you might look at your IRA or 401(k) balance and think to yourself, "Wow, that's a lot of money." But don't be fooled by an impressive-looking number on paper or a screen, because until you figure out what that number means in terms of actual annual income, it won't do you much good.

Older man reading magazine and holding mug

Image source: Getty Images.

Imagine you have a $500,000 savings balance -- that's not a small amount. But how much of that can you afford to withdraw on a yearly basis to use? To answer that question, you might employ the 4% rule.

Long touted by financial experts, the rule states that if you withdraw 4% of your savings during your first year of retirement, and then adjust subsequent withdrawals for inflation, there's a high likelihood your savings will last 30 years. Therefore, if you're sitting on a $500,000 nest egg and follow the 4% rule, you would start off with $20,000 your first year of retirement, and then adjust future withdrawals as needed to keep pace with inflation.

In this scenario, you therefore need to ask yourself: Is $20,000 a year enough to live on (keeping in mind that you'll likely have other income, like Social Security, to utilize as well)? If it's not, then you may want to work a few more years to pad your savings. Either way, be sure to understand what your annual income actually might look like.

2. You have a lot of debt

Once you retire and move over to a fixed income, you might find that you're forced to stick to a tighter budget than you did during your working years. As such, it really helps to enter retirement without any sort of debt hanging over your head -- especially not the unhealthy kind, like credit card balances. And if you are in debt, it might pay to spend a few more years in the workforce paying it off before bringing your career to an end.

Imagine you expect to have $42,000 a year, or $3,500 a month, in retirement between your savings and Social Security. If you go into retirement on the hook for $900 a month in mortgage and credit card payments, that's about a quarter of your monthly income, gone. Entering retirement without that debt will make for a much less financially stressful existence, so before you resign yourself to dealing with that debt in the absence of a paycheck, think about the consequences.

3. You don't know how you'll spend your days

There's a reason retirees are 40% more likely to suffer from depression than workers: Too much free time can quickly lead to feelings of unhappiness and monotony. That's why you really need to come up with a plan for your newfound free time before you enter retirement.

You might think you'll join a country club and travel a lot to stay busy, but if your finances don't support that lifestyle, you'll need a backup plan. And you're better off ironing out that aspect of your life before you leave your job and find that you're bored senseless.

Retirement can be a rewarding time, but if you don't go in prepared, you could end up hating it. If any of the above scenarios apply to you, be sure to resolve them before leaving the workforce permanently. You'll be happier for it in the long run.