A retirement paycheck is a practical way to think about how you will pay yourself during your retirement years.

Click below to learn how each factor works together to optimize your retirement paycheck.

How long should I continue working before retirement?

  • Make sure you can afford it: Don’t stop working until you can afford to – as long as you are healthy.
  • Work until full retirement age: Aim to work at least until your full retirement age (66-67). This produces many benefits, including:
    • Larger monthly Social Security payment: By delaying taking Social Security, you will receive a larger monthly payment, and all Social Security retirement benefits are adjusted for inflation.
    • Increased savings: You can keep adding to your retirement nest egg instead of depleting it too quickly.
    • Health care: You will keep your employee health care and other benefits longer.
  • Plan ahead: Assume you may have to spend less once you retire. Some costs will be higher and your disposable income may decrease due to inflation.
  • Phased retirement: If you are considering phased retirement, know what impact scaling back will have on your retirement income, retirement benefits, health care coverage, job security and other life situations.
  • Work part time: Consider part-time work as a good way to supplement your retirement income.
  • Be cautious of buyouts: View buyouts with caution and evaluate lump sums carefully: A lump-sum payment may be attractive, but ongoing payments could have more advantages in the long run. Income taxes are spread out over time and payments provide an ongoing "paycheck."