When evaluating whether or not you can afford to retire, you need to compare two things: your income/savings and your expenses. Start by see how much money you have saved and what your income will be (i.e. Social Security) when you stop working. Then, estimate what your monthly expenses will be. If you don't quite have enough income to cover your expenses, repeat the exercise above but factor in whether you do or do not sell your home. In either situation, your expenses will change.