He could have played for another 8-10 years, but I guess his decision was family orientated. CH ranking of 17, 7 ATP titles, 2 Grand Slam QF's, a Masters final and a 9-2 DC record. I'm sure he'll be great in his new role.
It has always been obvious that being a professional tennis player is not the bee all and end all for Colin. So while family considerations are surely part of the decision I would imagine that the decline in his ranking is also a big factor. I don't think he is the kind of guy to spend years grinding it out at challengers and and smaller ATP tour events after having previously been a a pretty regular fixture in Slams and Masters Series events.