What is the Best Date to Retire?

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By on November 15, 2012 in Retirement with 16 Comments

“Best”?  What is meant by this?

If you are thinking of a new, relaxed life style, then the best retirement date is as soon as you are financially able and psychologically prepared.  Period.  However, if you are concerned about the monetary nuances, then there are a number of best dates, each a bit better than the previous.

For example, let’s say the hypothetical situation is that the new year, for pay purposes, starts on January 3.  Note:

Retirement Date Reason
December 8 First date eligible to retire.
December 20 Last day of pay period – receive full credit for 4 hours sick leave and 8 hours annual leave.
December 31 Receive full credit for current year earnings in calculation of annuity supplement. (Any earlier retirement date would result in -0- credit.) Also, first annuity payment will be for January.
January 3 Lump sum for accumulated annual leave paid at new rate, assuming a general salary increase! Also, more sick and annual leave credit. However, January retirement means no annuity until February.
January 8 Receive credit in annuity calculation for one more month of service. Slightly larger annuity.

In most cases, the longer you wait to retire, the more financial advantages you will accrue.  Do you need them?  If not, just retire as soon as you can, and enjoy yourself!  I’m sure we all know of cases where employees could have retired sooner, but waited and waited…  and then one day “Poor Joe.  He was planning on retiring real soon.”

My recommendation is, generally, if you are financially able and psychologically prepared, don’t dwell too much on the above incremental gains.  Just go!

© 2017 Robert F. Benson. All rights reserved. This article may not be reproduced without express written consent from Robert F. Benson.

About the Author

Robert Benson served 35 years in various Federal agencies, as both a management analyst and IT specialist. He is a graduate of Northwestern University.