--- title: "Retirement Planning: Frequently Asked Questions" description: "Retirement Planning: Frequently Asked Questions" --- ![Retire planning](https://allworthfinancial.com/hs-fs/hubfs/Allworth_Financial_April2023/Images/faq_retire-planning_1366x340.jpg?width=1366&name=faq_retire-planning_1366x340.jpg "Retire planning") ## Frequently Asked Questions # **Retirement Planning** ## What is retirement and how does it work? In the most general sense, retirement comes at the conclusion of a person’s career or working life. It’s your life *after *you finish your career. 100 years ago, people worked until they were physically no longer able. More recently, with longer lifespans, people began to work until they had saved enough money to stop working and live a life entirely of their own choosing. It’s different for everyone. Some people want to keep working forever, while others want to stop as soon as they can. A full 50% of all people are forced to retire before they planned. This astonishingly high number shows that half of all people do not stop working on their own terms, and, by extension, are more likely to have not saved enough money to live the life they hoped for once they did reach the age that they planned to stop working. ## What are the different types of retirement? From riding off into the sunset, to sudden, forced retirements due to ill health, there are as many different types of retirement as there are people. Some people volunteer, others start companies, others travel the world, and still others play golf or watch television. Just as there is no “one” way to retire, there is no “right” way to retire. ## What is the full retirement age in the U.S.? As of February 2020, full retirement age in the U.S. is 66 years and 2 months. This number will gradually rise to age 67 for people born in 1960 or later. Full retirement age is an age that the Social Security Administration uses to assess, first, whether you are eligible to receive Social Security, and, second, how much you will receive. If you apply earlier than your full retirement age (you must be at least 62), you’ll receive a smaller monthly benefit. If you apply later than your full retirement age, capped at age 70, you’ll receive more. ## What is the best retirement age? The best age to retire is different for everyone and there is no widely accepted number. It depends largely on your financial situation and your goals in life. Generally, you want to save enough money to retire at an age where you are still physically and mentally healthy enough to enjoy the fruits of your labor and to constructively and enjoyably fill all the additional free time. Unfortunately, that doesn’t always happen. Studies show that the highest levels of overall happiness are found in people over the age of 55. People in this age demographic report the most satisfaction with their financial situation, their overall well-being, and their physical appearance. As people are generally happiest after age 55, according to one longitudinal study, the age at which happiness and contentment peaks is 74. ## What does retirement planning involve? When it comes to money, retirement planning involves the allocation of savings that has been accrued during your lifetime to use during retirement. It is the process of defining income goals and the steps necessary to achieve those goals. It includes identifying and maximizing retirement income sources, assessing risk and investment management, debt management, and more. Other aspects of retirement planning include deciding how much you can spend, where you want to live, and what you want to do with yourself once you retire. ## How can I plan for an early retirement? Either because of health emergencies, job loss, or the declining health of a loved one, with 50% of people forced to retire before they planned, everyone should prepare for an early or involuntary retirement. Whether you are forced to stop working, or whether your goal is to retire young, it’s essential to start saving early *and consistently*, to stick to a budget, and to set realistic goals.  Retirement planning is a lifelong process, and people who start early and stick to a plan are generally more ready to retire early whether they do so voluntarily or whether they are forced to stop working due to circumstances beyond their control.   ## Will I outlive my savings? According to a study by the World Economic Forum, more than half of all people who have saved for retirement *still *run out of money ten years before they die. Think about it his way: one third of people who are 65-years old today will live past age 90. 20% will make it to age 95. With retirements lasting 25 or 30 years, if you fail to save well, or fail to invest your money in a way that allows you to live off the interest (and not deplete your savings) there’s an excellent chance you could run out of money at some point during your retirement. This is why financial planning is such a critical part of retirement preparation, and why we recommend working with a professional, credentialed fiduciary to help you assess your retirement outlook. ## What is the secret to a happy retirement? The secret to a happy retirement is prosperity: the state of being prosperous. Prosperity isn’t having lots of money. And it isn’t just feeling good. Feeling prosperous is the feeling that your financial situation is solid and under control. That you are free, or, generally free from financial worry. Other studies on retirement have determined that the keys to happiness in later life revolve around good health, staying social, having optimistic friends, having a positive outlook, and being pain free. ## What are retirement communities? A retirement community is a housing community or complex designed specifically with retirees in mind. Although there are myriad options and potential amenities, depending on one’s budget and preferences, typically, a retirement community is a place where only adults who can generally take care of themselves live. Additionally, some communities may offer social activities ranging from group vacations to exercise to entertainment.  ## If you're looking to get detailed answers about your particular situation, schedule your free consultation with one of our financial advisors. 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Check the background of this firm on [FINRA's BrokerCheck.](https://brokercheck.finra.org/) HMRN Insurance Agency, LLC license #0D34087 1Barron’s 2024 Top 100 RIA Firms. Barron's© magazine is a trademark of Dow Jones L.P. The ranking of independent advisory companies is based on assets managed by the firms, growth, technology spending, succession planning, and other metrics.  2 Retention Rate Source: Allworth Internal Data, FY 2022 3 The NBRI Circle of Excellence Award is bestowed upon NBRI clients meeting one or both of the following criteria: Total Company score at or above the 75th percentile of the NBRI ClearPath Benchmarking Database and/or improvement of five (5) or more benchmarking percentiles in Total Company score over the previous survey.  4 As of 1/1/2025, Allworth Financial, an SEC registered investment adviser and AW Securities, a registered broker/dealer have approximately $26 billion in total assets under management and administration.  *5 InvestmentNews 2020 and 2021 Best Places to Work for Financial Advisers. The ranking reflects survey responses and scores completed by both employers and employees. Employers report their organization’s workplace policies, practices, and demographics. Employees complete a survey designed to measure the employee experience. * 6  2021 Value of an Advisor Study / Russel Investments *7 Ranked 9th Top Wealth Managers By Growth in Assets in the U.S. from RIA Channel, 2022. RIA Database and RIA Channel are registered trademarks owned by Labworks, LLC.* *8 **USA Today Best Financial Advisory Firms 2024. The ranking is based on the growth of the companies’ assets under management (AUM) over the short and long term and the number of recommendations they received from clients and peers.* *9 NBRI Best in Class Ethics 2023. The Best in Class level is bestowed upon clients performing at or above 90 percentile of the NBRI ClearPath Benchmarking Database.* ✢ Scott Hanson, Investment Advisor 2005, 25 most influential people in the financial services industry. The ranking reflects 25 people who Investment Advisor magazine believes have had or will have the greatest influence on the financial services industry. ✼Pat McClain, InvestmentNews 2014, Invest in Others Community Service Award, presented to an advisor who has made an outstanding impact on a community through managerial contributions to a non-profit organization. †Financial Times, FT 300 Top Registered Investment Advisers, June 2019. 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While efforts are made to ensure the information’s accuracy, it is subject to change without notice. Allworth conducts a reasonable inquiry to determine that information provided by third party sources is reasonable, but cannot guarantee its accuracy or completeness. Opinions expressed are also subject to change without notice and should not be construed as investment advice. The information is not intended to convey any implicit or explicit guarantee or sense of assurance that, if followed, any investment strategies referenced will produce a positive or desired outcome. All investments involve risk, including the potential loss of principal. There can be no assurance that any investment strategy or decision will achieve its intended objectives or result in a positive return. It is important to carefully consider your investment goals, risk tolerance, and seek professional advice before making any investment decisions.