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Retirement
Definition
Retirement is the stage of life when a person stops working full-time and lives on savings, investments, and pension income.
Explanation
Retirement planning involves setting aside money throughout your working years to fund your lifestyle after work. Key factors include retirement age, life expectancy, desired lifestyle, investment returns, and inflation. Most experts recommend saving 10-15% of income for retirement throughout your career.
Modern retirement is increasingly flexible with options like phased retirement, part-time work, and the FIRE (Financial Independence, Retire Early) movement.
Example
To retire at 65 with an annual income of $50,000 from savings, you typically need about $1.25 million in retirement accounts (using the 4% withdrawal rule).