Retirement

Treat your retirement savings seriously. 

Every year, Canadian financial institutions reveal the results of various studies on investor behaviour. One alarming study showed how many people take money out of their RRSPs early. While there are plans for using RRSP savings to purchase a first home or fund further education, over 20% of Canadians dip into their plans to cover day-to-day living expenses.

Recent studies also show people spend more time planning for their vacations or a major purchase than they do planning for their retirement! Considering that many of us will spend 30 to 35 years in retirement, this statistic defies logic.

Here are my answers to some of my clients’ most frequently asked questions about retirement.

“How much do I need to retire?”

This number is different for everyone. It really depends on your lifestyle but also takes into account your various sources of retirement income. Canada Pension Plan, Old Age Security, employment pensions and savings all come into play. Taxes are also a factor, as you need to know your net income. And let’s not forget about inflation.

If you would like a more detailed look at how much you will need when you retire, email me.

“What about my transition to retirement?”

Retirement planning is about more than money. It is a huge lifestyle change for which many of us do not plan. I counsel people to see retirement as more than just taking time off: it is about maintaining a healthy and engaged life.

“What happens to my RRSP when I retire?”

Your Registered Retirement Savings Plan (RRSP) is a tax-deferred account that helps you to save for retirement. During your working years, the main objective is to grow your investment portfolio. But when you retire, the focus changes and the options are many. As you approach this phase of your life, it is time for a major review of your holdings.

The comments contained herein are general in nature and are not intended to be, nor should be construed to be, legal or tax advice to any particular individual. Accordingly, individuals should consult their own tax advisors for advice with respect to the tax consequences to them, having regard to their own particular circumstances.