What Are the Five Stages of Retirement?

What Are the Five Stages of Retirement?

Retirement is not just a time in your life where you stop working. This is the stage of your life marking the passage of a working life to a life of choice, accomplishment, and leisure.

Throughout all of those years of working, your job is probably the one thing that defined you, from the moment you open your eyes in the morning to how you introduce yourself when you attend events and occasions.

But, the moment you retire, you will lose this identity.

In order to prepare yourself better for this significant change in your way of life and your life as a whole, it is best to be familiar with the five stages of retirement.

Stage 1: Pre-Retirement

The first stage is a robust phase marked by the last 10 to 15 years that lead up to your official retirement day. You have to use this particular time to ensure that all of your retirement accounts are in great shape. These include your 403(b) plans, 401(k) plans, IRAs, as well as other savings vehicles that you have.

You might also want to continue contributing to all of your tax-advantaged accounts like your HSA or health savings accounts. The funds that you have in your health savings account carry over from one year to the next and offer outstanding tax benefits. You can also make withdrawals that are free from penalties after you reach 65 years old. It would be a good strategy for retirement savings to funnel some of your retirement savings to your health savings account, particularly if your 401(k) is already maxed out.

It would also be a perfect time to research more about Social Security. Learn when you will start to receive payouts, the possible amount that you will earn, and how this will affect your overall budget.

You might also choose to hold off on your disbursements from Social Security until you got to your age for full retirement that can vary based on your year of birth. Remember that 62 years old is the earliest age that you can receive Social Security. However, once you turn 70 years old, your benefits would have been maxed out, thus, it might not be worth it to continue holding off.

Medicare is another primary consideration for people who are in pre-retirement stage. Healthcare cost is among the biggest expenses that you will incur when you reached your age of retirement. Studies revealed that an average couple needs as much as $285,000 to pay for their healthcare during retirement. This doesn’t include yet the expenses for long term care. This is why you have to ensure that all of your healthcare plans have been put in order prior to your retirement.

Stage 2: Full Retirement

The honeymoon or liberation stage of retirement takes place at the second phase. This is the official beginning of your retirement that could last from one year or two after retirement.

This stage of liberation is the time when you can experience feelings of relief, excitement, and freedom from all the responsibilities and stress of your daily working life.


During this stage of retirement, people often spend their time reconnecting with their family, spouses, and friends. This is also when they travel, start on new hobbies, and embark on business ventures.

Instead of going down and living this route like that of a honeymoon vacation, there are people who choose settling into a specific routine right away. They wake up every morning with a good plan in place and usually continue with the activities that used to be part of their daily busy schedules when they were still working. There are also others who just choose to rest and relax after all the years of working tasking jobs that often drain all of their energy.

Stage 3: Disenchantment

After the emotional high of retirement already faded away and the honeymoon stage is finally over, a lot of people tend to feel some sense of disillusionment and disappointment. They spent a lot of time looking forward to their retirement that the moment it has set it, it starts feeling not as exciting as what they were made to believe. As a result, they often feel as if their life is missing something.

There could be a lot of downsides during this stage such as feeling useless, boredom, and loneliness. And when not addressed properly, it is all too easy to fall depressed during this particular stage.

Stage 4: Reorientation

Usually regarded as the most challenging stage of retirement, reorientation often happens after the retiree has quickly finished everything on their to-do list for their retirement. The feeling of losing their purpose starts settling in and they start evaluating their retirement experience.

This stage also involves developing a new identity and this might take some effort and time to accomplish. However, after you developed a new identity, this will give you the sense of closure from those days of being a worker and you move on to enjoying your retirement as it was meant to be.

To ensure that you don’t fall into depression and stuck in a rut, it is important that you look for something that could give you a sense of more meaningful purpose in your later life. Maybe you can pursue a passion, do volunteer works, and include new fun activities to your everyday routine.

Stage 5: Reconciliation and Stability

The last stage of retirement might start up to 15 years following the official beginning of retirement. Once they reached this stage, retirees are hopeful and content in the transition and they also feel less anxious and depressed.

This is the stage when retirees have already settled into a rewarding and fun retirement style wherein they do things that give them a sense of fulfillment. They also make it their priority to make their lives simpler and live lifestyles that are more relaxed and comfortable.

This is also the stage when health conditions tend to be more prevalent so retirees tend to focus on retaining their independence and health that they sometimes move to retirement communities and age in place there with access to nearby friends, activities, amenities, and healthcare.

Although not all retirees experience every stage of retirement with the same length of time or intensity, many retirees go through the same process after their working life has come to an end.