No one is suggesting that ARod simply say, "I've had enough." He's coming back from a second serious surgery at an advanced age. He'll have a medical out.
Don't get hung up on the word "retire." Think of it as "no longer able to play." No sports agent in the world would allow a player to sign a contract that doesn't pay him/her in the event of injury or physical disability. Are the Yankees paying ARod now? The player is protected from injuries by the contract, and the team is protected by insurance.
From the NY Times in March:
One possibility is that the injury is so bad that Rodriguez is medically unable to play. At that point, an insurance policy would pay for a substantial part of the contract.
The Yankees’ insurance policy on the contract includes a four-month deductible, and after that, they are reimbursed for 33 percent of the salary in the first year. If Rodriguez is considered permanently disabled, the insurance will cover 75 percent of the remaining money after the four-month period.