13 most frequently asked retirement questions

If retirement is looming in your future, you may wonder about how exactly this next phase of your life will play out. From when to start collecting benefits to how exactly money will end up in your bank account each month, the process of starting retirement can seem like a mystery. To help you understand the key milestones of retirement and allocate funds strategically, you should assess your own financial situation and consider the best ways to maximize benefits.

Read on for answers to common questions and tips for a comfortable and fulfilling retirement.

**How Do I Retire?** Leaving the workplace may be as simple as filling out paperwork with your human resources office, but replacing a paycheck can be more difficult. Kyle Ryan, executive vice president of advisory services for hybrid digital wealth manager Personal Capital, says the No. 1 question he hears from workers is: “Logistically, how am I going to make that happen?” They want to know about how to move from the steady income of the workplace to living off their retirement savings. The answer is usually found by sitting down with a finance professional and determining how much to pull out of retirement accounts and on what schedule. (Getty Images/iStockphoto/fizkes)

Mature couple doing some paperwork and calculations at home — **When Can I Retire?** The short answer: You can retire when you want to leave the workforce and can afford to do so. However, in reality, people may have many constraints on when they can leave the workforce. For instance, some employees may have to work 20 or 30 years to be eligible to receive a company pension. Those who need Social Security to retire can’t begin collecting benefits until age 62 at the earliest. And Medicare doesn’t begin until age 65, meaning workers who receive health insurance through an employer may wait until then to retire. (Getty Images/iStockphoto/bernardbodo)

**How Much Money Do I Need to Retire?** It all depends on what you plan to spend in retirement. Gage Kemsley, vice president of financial firm Oxford Wealth Advisors in Rio Rancho, New Mexico, finds it frustrating to hear some financial advisors say a specific amount is needed to retire. Rather than providing a blanket figure such as $1 million or $2 million, Kemsley says people should work with an advisor to determine how much is needed to meet their specific retirement goals. (Getty Images/iStockphoto/juststock)

**How Much Will I Spend in Retirement?** To determine how much you need to retire, you need to understand how much you’ll spend. Fortunately, that’s not as hard to calculate as it might seem. “It’s not a guessing game at all,” says Tim Speiss, partner-in-charge of the personal wealth advisors practice with the accounting firm EisnerAmper LLP in New York City. Financial advisors can use a person’s spending habits, expected inflation and life expectancy to determine how much they will reasonably need in retirement. (Getty Images/iStockphoto/Zephyr18)

Happy old middle aged couple holding reading good news in document, smiling senior mature family excited by mail letter, checking paying domestic bills online on laptop, discussing budget planning — **Should I Retire Early?** No one can answer that but you. However, financial advisors can run through a number of what-if scenarios to help a worker determine the best time to retire from a financial perspective, Ryan says. These scenarios can consider whether retiring early could lead to a shortfall of money later. (Getty Images/iStockphoto/fizkes) [**See:** 11 Ways to Avoid the IRA Early Withdrawal Penalty.] (Getty Images/iStockphoto/fizkes)

USA Social security cards laid on pile of dollar bills to illustrate money in retirement — **When Should I Take Social Security?** Workers can take Social Security as early as age 62, but they will permanently reduce their monthly benefits by 25%. The full retirement age for those born from 1943-1954 is 66, and seniors can get up to an 8% bump in benefits for each year they delay their claim up to age 70. Those who plan to continue working full-time until their full retirement age should think twice about taking early Social Security benefits. There is a benefits penalty of $1 for every $2 you earn above $17,640 in 2019 if you are younger than the full retirement age. And some may worry about Social Security running out of money and take their benefits early for that reason. However, Kemsley is optimistic that the program isn’t going bankrupt, and these concerns shouldn’t drive the decision of when someone begins benefits. (Getty Images/iStockphoto/BackyardProduction)

Social Security Card — **How Do I Apply for Social Security Benefits?** There are three ways to apply for Social Security benefits. Retirees can complete an online application through the Social Security Administration website or call 1-800-772-1213 to submit an application over the phone. The final option is to visit a local Social Security Administration office and apply in person. (Getty Images/iStockphoto/Starflamedia)

How Much Will I Pay in Taxes in Retirement? A tax professional can likely estimate your effective tax rate in retirement. Some retirement savings, such as traditional 401(k) or IRA accounts, are taxable, while money from Roth accounts is exempt. Depending on how much income you have in retirement, a portion of your Social Security benefits may be taxable, too. In addition to calculating expected federal taxes, Kemsley advises workers not to overlook state taxes. (AP/Keith Srakocic)

AP/Keith Srakocic