There is not necessarily a “best” time to retire; however, you may want to consider several things when making your decision to retire:
Cost-of-Living Adjustments
Cost-of-living adjustments (COLAs) are issued each July 1 to retirees and beneficiaries who have been receiving a payment for at least six months. Therefore, if you retire by January 1 of any given year you are entitled to a COLA July 1 of that same year. If you retire after January 1, you are not eligible until July 1 of the following year.
Payout for Annual Leave, Holiday and Comp Time
If you are considering retiring at the end of the year, you should remember that you may receive annual leave, holiday pay and comp time in the pay period following your last pay period. You may want to consider delaying your retirement to January 1, so that this payoff is made in the following tax year.