The first stage of retirement is generally defined as Pre-Retirement (typically ages 50–62), a critical planning phase occurring 5–10 years before leaving the workforce. This stage involves intense financial assessment, estimating retirement income, and visualizing lifestyle changes, with an increasing focus on emotional preparation alongside financial savings.
Officially, you'll start the retirement process with your employer, letting them know when you plan to stop working. Depending on your employer and your tenure, you may need to write an official letter of resignation, document your contacts, processes, and files, and maybe even train a replacement.
But experts suggest we think of retirement more expansively, in a phased approach—especially when it comes to financial planning. In fact, there are generally four distinct phases around retirement: pre-retirement, early retirement, mid-retirement, and late retirement.
Stage 2: Transition
As individuals approach retirement age, they enter stage two: the transition phase. This stage marks the period when employees begin to exit the workforce and adjust to a new lifestyle.
The rule suggests that you can safely withdraw 4 percent of your investment portfolio in your first year of retirement and then adjust for inflation in future years to determine the optimal withdrawal rate. This rule should allow you to enjoy a 30-year retirement with a relatively small chance of outliving your money.
Retirement corpus calculation:
Monthly expenses at retirement (after 10 years of 7% inflation): ₹3 lakhs. Annual expenses: ₹36 lakhs. Required corpus: ₹10.8 crores. Additional corpus needed: ₹7-8 crores (after accounting for existing savings growth)
Common challenges of retirement include:
Struggling to “switch off” from work mode and relax, especially in the early weeks or months of retirement. Feeling anxious at having more time on your hands, but less money to spend.
The current full retirement age is 67 years old for people attaining age 62 in 2026. (The age for Medicare eligibility remains at 65.) Refer to Benefits By Year Of Birth for more information.
We call them the four pillars: health, family, purpose and finances.
The 5 pillars of retirement planning typically focus on the essential financial and life areas for a secure future: Income Planning, Investment Planning, Healthcare Planning, Tax Planning, and Estate Planning, ensuring you have funds, efficient withdrawal strategies, and provisions for health, taxes, and legacy. Some approaches also add a sixth pillar for non-financial fulfillment, such as purpose, relationships, and well-being.
Overview
You can get Social Security retirement or survivors benefits and work at the same time. However, there is a limit to how much you can earn and still receive full benefits. If you are younger than full retirement age and earn more than the yearly earnings limit, we may reduce your benefit amount.
The 5 Stages of Retirement: Unlocking a Fulfilled Later Life
A common starting point is to estimate that you'll need about 70% to 80% of your pre-retirement income to maintain your standard of living in retirement. For example, if you earn $150,000 annually while working, you might need between $105,000 to $120,000 as a starting point in retirement.
The full retirement age is increasing gradually if you were born from 1955 to 1960, until it gets up to 67. In 2025, the full retirement age is 66 years and 10 months. For those who turned 66 in 2024, FRA is 66 years and eight months.
Reasons Your Application May Take Longer Than Expected
Missing required documents or accidentally providing incorrect information with your Social Security application can cause a delay.
Longevity (or outliving your assets) is probably the one single greatest retirement risk. Thanks to medical advances and a healthier lifestyle, you may have a longer retirement than you think. You may even spend as many years in retirement as you did working.
The top ten financial mistakes most people make after retirement are:
In short, many retirees — despite modest or even no savings — can rely on a combination of Social Security and limited savings to support a basic but sustainable retirement. And for many, expenses in retirement are lower than expected.