When should you retire? (2024)

Retirement used to be referred to as "a three-legged stool" that rested on pension checks, personal savings and Social Security benefits.

How do you know if you've saved up enough for your golden years? CNBC Select chatted with retirement experts about recognizing the signs that you're ready to retire.

Figuring out how much money you need before you can quit working is a job in and of itself.

Some experts say that you should save at least 10 times your annual salary socked away by the time you're 67.Others point to the 4% rule, which says you should be able to comfortably live off of about 4% of your investments in each year of retirement, thus allowing you to cover expenses for about 30 years.

The 4% rule is a good indicator if you plan on spending the same amount in retirement as you do now, says Jackie Cummings Koski, a financial consultant who retired at 49. But Koski recommends building an estimated expense budget to get a more accurate picture.

Once you get an estimated retirement budget, multiply it by 25 to get a fairly accurate amount that will see you through retirement. If you expect to spend $40,000 a year, for example, you need $1 million ($40,000 x 25) to retire comfortably.

One of the biggest mistakes you can make in retirement planning is not having an emergency fund. Your assets aren't as liquid in retirement — you can't just go to the ATM and withdraw cash when your money is invested in the market.

A high-yield savings account (HYSA), lets your money earn robust interest while still enjoying FDIC protection. Marcus by Goldman Sachs has a fee-free HYSA with no limit on how much money you can withdraw. (There is a limit of six withdrawals and transfers per monthly statement period, however.)

Your emergency fund should be easily accessible and shielded from the ups and downs of the stock market.

"You don't want to say 'Honey, you can't have that heart surgery because our accounts are down 20%,'" Buhrmann said. "You want that to be safe and secure."

Putting all your retirement eggs in one basket isn't a good idea. Mitigate your financial risk by spreading your savings and investments across multiple streams of future income.

Robo-advisors can help align your retirement portfolio with your risk tolerance, time horizon and financial goals, while allowing you to remain hands-off. Both BettermentandWealthfront automatically rebalance your portfolio over time to account for changes in your time horizon and needs.

Working with a financial planner is another way to help you figure out how to best diversify your retirement portfolio, relieving some of the stress that accompanies retirement saving.

Still, make sure you have cash reserves on hand for when the markets curve downward. This way, you can allow your investments to rebound, instead of tapping them to cover expenses.

Even if you have healthy investments or a pension, it's important to know how much you can expect in your monthly Social Security check. To get a good idea, log onto the Social Security Administration (SSA) website and review your projected benefits after retirement.

You can start drawing Social Security at 62, but waiting at least until your full retirement age can mean bigger payments. According to the SSA, benefits increase by up to 8% each year you delay.

If you wait until 70 to start collecting, you can receivedelayed retirement creditsfor each month you delay. (The benefit increase stops when you reach age 70.)

"I've had clients that have made those decisions and regret that now," Bishop said. "They're getting $1,500 or $1,600 a month from Social Security, where they could have had $2,400 or $2,500 a month if they waited a few years."

Health costs rise exponentially in retirement, right when your employer-backed health insurance ends.

Long-term care insurance covers support services like at-home care, physical therapy, assisted living and nursing facilities. Since it's a lot harder to get approved with a preexisting health condition, experts recommend buying a policy inyour mid-50s, when you're still relatively healthy.

"Just like you shouldn't try to buy home insurance when your house is on fire, the week before grandad goes into the nursing home is not the time to apply for a long-term care policy," Buhrmann said.

New York Life is one of CNBC's top picks for long-term care insurance and it's one of the few providers that still offers a stand-alone policy. The Secure Care plan can be used to pay for care provided by family members and couples that purchase a joint policy can earn a discount of up to 25%.

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