- Retirement means leaving the workforce, usually permanently and with eligibility for benefits, while resignation means leaving a specific job to pursue another role.
- Four signals you may be ready to retire include feeling emotionally drained, declining health, being financially prepared, and no longer identifying with your job.
- Retiring can bring more freedom, health gains, and Social Security access, but tradeoffs include reduced income, higher health insurance responsibility, fewer social ties, and loss of structure.
- Reasons to resign include lack of challenge, poor fit with boss or colleagues, stalled learning, and persistent unhappiness; weigh benefits like new challenges against risks such as financial instability, burned bridges, and longer job searches.
- Decide with clarity about purpose and lifestyle; consider the outlined questions before choosing to retire or resign, and plan beyond finances for a smoother transition.
The Difference Between Retirement and Resignation
While the two may seem similar, retirement and resignation are two very different things. Retirement is when you stop working because you’ve reached the age where you’re eligible to receive benefits like Social Security or Medicare. Resignation, on the other hand, is when you voluntarily leave your job because you’re no longer happy with it or because you want to pursue something else (kind of like when you hear the term “quitting a job”). Another distinction:- Retirement is usually a permanent decision to leave the workforce (although you can continue working after retirement)
- Resignation is usually a decision to switch to a different job
Now that you know the difference between retirement and resignation, let’s take a closer look at the pros and cons of each.
Is It Better to Resign or Retire?
When it comes to deciding which is best for you, it’s all about finding clarity on details like your retirement purpose, your new identity in retirement, and what you want to retire to. Without the clarity, it may cause some retirement anxiety, and you may choose to postpone your retirement date and focus or resigning from your less-than-ideal job in the meantime. Either way, there are some key factors to look into, starting with deciding if retirement is right for you.When to Retire?
It’s a question that plagues almost every worker at some point in their career: when is the right time to retire? The age at which you retire is often based on factors including your age, financial security, health, and personal goals. For instance, depending on the country, the average retirement age may be sooner than the official retirement age and vice versa.
Beyond age, though, there’s emotional readiness to consider.
For some people, retiree life is a dream come true. They can finally enjoy all the activities they never had time for while working. Others find that retirement is a difficult adjustment and even experience some pre-retirement anxiety.
But in general, these four signs are an indicator you’re ready to retire:
- You’re emotionally drained
- Your health is declining
- You’re financially prepared
- You don’t identify with your job
Benefits of Retiring
- The freedom and time to pursue your interests — one of the great things about retired life is that you finally have the time to do all the things you love
- Improved mental and physical health — according to a meta-analysis of research, retirement generally positively impacts your health as you can focus on self-care
- Social security and lower taxes — in the US, retirees are eligible for social security benefits, and in many cases, retiree income is taxed at a lower rate than earned income
Drawbacks of Retiring
- Reduced income — unless you have a good pension plan or savings, you’ll likely have to downsize your lifestyle significantly
- Health insurance costs — when you retire, you’re also responsible for sourcing all your own health insurance costs
- Reduced social interaction — research indicates that you may lose some social ties during your transition into retirement
- Loss of structure — after the honeymoon stage of having no set schedule wears off, many retirees find they miss the structure of a workday
When to Resign?
While several people choose to retire when they reach a certain age, several others find that they still have plenty of energy and enthusiasm for work (whether it’s in the same career field or something totally different). If you fall in the latter category, but your current job is no longer fulfilling, then resigning may be the best option. Not to mention, it’s a pretty common move when you consider the temperament of the recent Great Resignation, where 48 million quit their jobs in 2021 in the US alone, the top reasons being:- Toxic corporate culture
- Job insecurity and reorganization
- High levels of innovation
- No longer feel challenged or fulfilled by your job
- Find yourself seeking a new position
- Do not get along with your boss or colleagues
- Don’t feel appreciated
- Feel like you’re no longer learning anything new
- Are consistently unhappy going to work each day
Benefits of Resigning
- A new challenge — if you’re no longer challenged by your job, then resigning can be an opportunity to seek out a new challenge elsewhere
- A less stressful role — if you’ve been struggling to stay on top of your duties (or your heart’s just not in it), a new job can drop a lot of that heavy stress
- A chance to explore — there’s nothing like giving yourself the chance to experiment, try new things, and connect with yourself again in a totally new environment and role; retirement is about growing, and discovering your new interests, passions, and purpose
Drawbacks of Resigning
- Financial instability — resigning without having another job lined up may put you in a difficult financial situation. Make sure you have a solid plan in place before you make the decision to leave your current position.
- Burning bridges — when you resign, ideally you do so gracefully and professionally without burning any bridges, as you never know when you may need to rely on your network in the future.
- Inconvenience for others — quitting without notice may cause inconvenience or hardship for your employer or colleagues. Try to give them as much notice as possible so they can make appropriate arrangements.
- It takes longer to find a new job — according to a 2012 report by the U.S. Government Accountability Office, over 55s take longer to find a new job
Should You Quit or Retire?
So, if you’re deciding whether you should retire or resign, we’ve outlined the key differences between retirement and resignation in order to help you make the best decision. To sum up:- Retirement is a decision to leave the workforce permanently. Resignation is a decision to leave a specific job or employer.
- If you’re considering retirement, consider both your finances and your health. If you’re thinking the resignation route, be sure to factor in your career goals and job satisfaction.
Frequently Asked Questions
Is resigning the same as retiring — emotionally, legally, and financially?
While both mean stepping away from a job, the context is very different. Resignation usually signals a career move – you’re leaving one role, often to pursue another opportunity. Retirement, on the other hand, is an official life stage. It typically happens once you reach the age or criteria to draw on benefits like pensions, Social Security, or retirement accounts.
How do I know I’m not just burned out — but truly ready to retire?
Burnout and retirement readiness can feel similar, but they’re not the same. One study found that rising burnout often pushes people toward retirement, yet as mood and clarity return, many are drawn back into the workforce – suggesting burnout is often temporary, not a full stop.
True readiness for retirement, on the other hand, is less about escaping stress and more about envisioning what you’re walking toward. If you’re not just longing for a break but genuinely imagining how to spend your days with intention, energy, and joy, that’s a different kind of signal. Burnout fades with rest; purpose doesn’t.
Will retiring early negatively impact my lifestyle later?
Retiring early doesn’t automatically compromise your quality of life, but it does require you to plan more carefully. Financial shocks like rising healthcare costs or outliving your savings are also more likely when you retire before traditional eligibility milestones.
Beyond money, your sense of purpose matters just as much. Longitudinal research shows that many people experience an increase in meaning after retirement (especially those who left dissatisfying work) proving that a well-planned retirement can reignite your sense of direction and fulfillment. That said, if you don’t create new routines, social outlets, or goals, the loss of structure can erode emotional well-being.
How do you emotionally prepare for a sudden end to your career identity?
When work ends, it’s not just the job title that disappears. It can feel like a piece of who you are goes with it. A recent review out of the University of Ljubljana found that people with a strong work identity often struggle most with the transition. Without the structure, purpose, and belonging that work provided, retirement can feel disorienting, even unsettling.
But here’s the hopeful part: identity isn’t fixed, it’s flexible. The same research shows that retirees who carry pieces of their old identity into new roles, whether through part-time work, volunteering, or simply finding fresh ways to contribute, adapt far more smoothly. It’s not about erasing who you were, but about weaving those strengths into who you’re becoming.
What role does timing play — and how can I tell it’s the right time to retire?
Timing plays a bigger role than most people realize. And yet, there’s no single “right” moment that fits everyone. For some, retiring earlier opens the door to freedom and adventure. For others, waiting too long means missed chances or years spent holding onto a role that no longer fulfills them.
In fact, our own Retirement Regrets survey found that of those who named timing as their biggest regret, the group was split almost evenly – half wished they’d retired earlier, while the other half wished they’d waited longer. That tells us there’s no universal formula. The “right” time is less about age or money alone, and more about alignment.
