5 Common Retirement Questions, Answered

1. How much money do I need to retire?

Start with the annual gap your savings must cover. Two households with the same portfolio can have very different plans if one has a pension, lower housing costs, or a later retirement date.

For a simplified example, suppose your annual cash needs are $72,000, including an allowance for taxes and healthcare, and Social Security and a pension provide $30,000 before tax. Your portfolio must supply the remaining $42,000. Keep income and tax estimates on a consistent basis so you do not count taxes twice.

That shortcut leaves out the years before Social Security starts, changing expenses, market losses, and how long retirement lasts. As a reference point, Morningstar's 2025 retirement-income research estimated a 3.9% starting rate under specific assumptions: inflation-adjusted withdrawals, a 30-year horizon, and a 90% modeled success probability. A result under those assumptions is not a promise for your household.

Try this: Write down essentials, flexible spending, and irregular costs separately. Then estimate the income gap year by year. For more detail, read How Long Will $1 Million Last? and our 4% rule guide.

2. When can I afford to stop working?

Compare retirement dates against the life you want to fund. Reaching a birthday or a savings milestone is only part of the decision. Leaving work earlier can mean fewer contributions, more years of withdrawals, and a longer gap before benefits begin.

Build three versions of the same plan: retire on your preferred date, two years earlier, and two years later. Keep spending and investment assumptions consistent at first. Then examine which years require the largest withdrawals and how the plan responds to a longer life or a poor first few years in the market.

A plan that works only with strong early returns deserves another look. Early losses combined with withdrawals can leave less capital available for a recovery; our sequence-risk article explains the mechanics. A high simulation success rate also needs context: check that the modeled spending actually matches your budget.

Try this: Identify one practical adjustment you could make if conditions disappoint: part-time work, a later retirement date, or a reduction in discretionary spending. Decide what is realistic before relying on it in a projection.

3. Should I claim Social Security at 62, 67, or 70?

Compare the larger later payment with the cost of waiting. For a worker born in 1960 or later, full retirement age is 67. Claiming a worker retirement benefit at 62 generally pays 70% of the full amount; waiting until 70 pays 124%. These percentages come from SSA's early-claiming table and delayed retirement credit rules. Delayed retirement credits stop at 70.

For an illustrative $2,000 monthly benefit at 67, that means $1,400 at 62 or $2,480 at 70, before taxes and future cost-of-living adjustments. Those are worker-benefit examples; spousal and survivor rules differ.

Waiting requires another source of income in the meantime. The decision also depends on health, longevity, work plans, and the income a surviving spouse would need. A simple break-even age cannot capture all of those considerations.

Try this: Use estimates from your own Social Security statement and compare the withdrawals required before each claiming age. Our 62 vs. 67 vs. 70 analysis walks through the arithmetic.

4. What should I budget for healthcare?

Separate coverage before Medicare, costs after enrollment, and long-term care. They are different planning problems.

If you retire before 65 and lose job-based coverage, a Marketplace plan may provide coverage until Medicare eligibility. HealthCare.gov's retiree guidance explains that financial assistance depends on household income and size. Use current quotes for your location and household, including premiums and potential out-of-pocket costs.

After Medicare enrollment, allow for premiums, deductibles, prescriptions, and services your coverage excludes. The mix depends on the coverage you choose. Higher income can also affect some Medicare premiums; see our Medicare and IRMAA guide.

Long-term help with bathing, dressing, and other daily activities needs a separate funding plan. Medicare generally does not pay for custodial long-term care. Do not assume a routine medical budget covers it.

Try this: Build a regular healthcare budget and a separate scenario for a period of substantial care costs. Use local estimates, and include a realistic source of funding.

5. How do I turn savings into income without overpaying taxes?

Plan both the amount you withdraw and the account it comes from. Spending $40,000 is not necessarily the same as withdrawing $40,000: taxes can create an additional cash need.

Pre-tax retirement-plan distributions are generally taxable, while after-tax contributions can change the taxable portion; the IRS explains the distinction. Qualified Roth IRA distributions are tax-free. The qualification matters: do not assume every Roth withdrawal at every age receives the same treatment.

A fixed withdrawal order can overlook how income changes across retirement. Compare the years before Social Security with later years, and consider whether taking some taxable income earlier improves the overall plan. A Roth conversion moves money between account types; it does not create extra wealth or erase the tax bill. Our Roth conversion guide explains the tradeoffs.

Also distinguish a fixed dollar withdrawal adjusted for inflation from taking a percentage of the current portfolio each year. The second approach changes spending with the market. A portfolio that avoids depletion by sharply cutting withdrawals may still fail to fund your needs.

Try this: Compare annual spending, taxes, and ending balances under more than one withdrawal approach. Review a proposed conversion or distribution with a tax professional before acting.

Put your retirement questions into a plan

Build a baseline in Beagle, compare scenarios, and inspect the annual spending, taxes, and withdrawals behind the results.