The treble-winning boss says he will not coach another team, while backing the decision to appoint Pep Guardiola at the Allianz Arena
Under the stewardship of the 68-year-old German, the Bavarians enjoyed a glittering season, sealing the Bundesliga, DFB-Pokal and Champions League.
They became only the seventh side in Europe to have achieved the feat of winning the league, domestic cup and European Cup in a single campaign.
However, with Pep Guardiola set to take over the reigns at die Roten, Heynckes has decided that the time has come to retire.
"I'm somewhat against finality," the former Borussia Monchengladbach striker told Der Spiegal.
"But I can say it for sure, I will not coach a team again. I've had a dignified exit from football."
The ex-Germany international has enjoyed a highly successful career, both as a player and a coach, lifting four Bundesliga titles as a forward at Monchengladbach, as well as the 1974 World Cup with die Nationalelf.
Heynckes also spoke positively of Bayern's future under Guardiola, however hinted that he would have been more than willing to continue at the Allianz Arena had the club not agreed a deal with the Spaniard.
"It's the right decision," he continued.
"You have to take this opportunity. If they had not found a replacement for me, we might have talked again but the situation now is the best for me. Guardiola will get a perfect working team."