So my question is how do you know it is time to replace the bearings?
Wheel bearing service goes like this:
Disassemble and remove bearings. Clean in Stoddard solvent, not gasoline. Dry bearings and inspect. Look for any signs of wear or failure of the bearing surfaces. Also clean and inspect the hubs and races. Clean and inspect the spindles.
You want to look for brinelling, fretting, cracks, discoloration, bent or damaged cages, rust.
NSK has a very good page on bearings here.
If everything looks good, pack the bearings with a good quality wheel bearing grease. I prefer the kind that is very sticky, that kind of strings as you pull it apart. Don't use chassis grease.
I learned to do this by hand, a small amount of grease in the palm, and briskly scoop into it with the bearing forcing the grease into the assembly while rotating the bearing. You know it is done when the grease comes out the other side.
Or you can get one of many various packers that use a grease gun or have a lever and reservoir of grease to force the grease in. They work great, and are a bit quicker than the manual method, but just as messy.
Reassemble, adjust and go.
If you can't get the dust seals off without damage or distortion, replace them. A trick I learned is to remove the outer bearing, replace the nut, and then use it to catch on the inner bearing as you pull the hub off. If you do it right, it pops the seal off cleanly. They can often be cleaned, and if not damaged reused, just pack the backside and lip with grease and reinstall.
Also use a new cotter key every time. Even if you have just put everything back together and realize that you forgot to put the seal on and have to pull it apart, use a new key.
One last point. Bearing adjustment. How tight or loose a wheel end bearing is set depends on the intended use and how it is lubricated. Heavy trucks and equipment have bearings that run in gear lube, and usually are set up tighter, with little or no endplay.
Bearings on light utility trailers that run with grease are usually set up with some endplay. It isn't much, and I think there is a spec for it, a few thousandths of an inch or something. After more than 40 years of taking them apart and putting them back together, I have developed a feel for it. After performing a wheel end service on a trailer, I take it out for a run, 5 or 10 miles. Stop, check the hubs, feel for how warm they are. If the hub is too hot to leave your hand on the bearing is too tight. If you grab the top of the tire and push/pull you should barely be able to feel the endplay. If you can hear it clunk, it is too loose.
Remember to retorque the lug nits after 50 miles or so too.