Retirement

Retirement can be the best time of your life. Your children are grown, your home is paid for and work is finally behind you. Although this sounds ideal, you might feel a certain amount of anxiety about your retirement. This is understandable - many people feel the same way. You may be wondering if you will be prepared financially. Having a clear picture of where your finances are going will probably make you feel better.

If you are like most people, you are probably under the impression that retirement planning is something that you do when you're nearing the age of 65. When retirement is 20 or 30 years away, it's easy not to think about it - especially when you have a mortgage to pay. But try to imagine your retirement, and the lifestyle you wish to have. Planning for your retirement can mean the difference between taking a trip around the world - and struggling to pay your bills.

The key to avoiding the stress involved with retirement planning is to start early. The sooner you start, the better off you will be when the time comes. If you've planned well - you will be able to look forward to your retirement, rather than fear it.

You are the person best suited to decide how to prepare for your retirement. With the help of a good financial advisor, you can design a retirement package for yourself that you will be able to enjoy!

You should try to figure out a few key things about your retirement, starting with your income requirements. Consider drawing up a budget detailing your needs for food, travel, clothing and transportation. Then, determine sources of income and benefits. Remember to look at government programs and any pension plans you have through your employer. Generally, retirees often have lower income needs. Although your mortgage might be paid and expenses associated with work have disappeared, factors such as increased health care costs and travel expenses might offset this savings. As a guideline for retirement planning, you should try to replace 70 to 80 per cent of pre-retirement gross income.

Next, establish an investment strategy to accumulate the necessary funds. For Canadians, retirement income generally comes from three sources: Government programs (Old Age Security, Canada Pension Plan); employer sponsored pension plans; and personal savings (RRSP). With the uncertainty of government programs, many people are also considering post-retirement part-time work as a way of contributing to their income.

By contributing to a Registered Retirement Savings Plan (RRSP) every year, you pay less tax now, and are preparing an income to help you enjoy your retirement. Having an RRSP could mean the difference between just getting by, and having the finances to live out your dreams.

Remember to monitor your retirement plan closely to make sure you are on track each year, and take into account periods of unemployment, government cutbacks in benefits and other scenarios that could affect your retirement income.

Retirement is your reward - learn how you can collect.

Click the Planning Tools button to explore the various calculators that will help you plan your retirement.

Cool Million
Want to save $1 million? Of course you do! Print a report that details when you will hit a cool million, simply by entering information about your current savings plan.
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Compound Interest
How interest is calculated can greatly affect your savings. When interest is compounded, or added to your account, you can earn interest on your interest!
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Retirement Planner
Do you have an RRSP? Use this calculator to determine how much monthly income your RRSP will provide you in your retirement. View the full report to see a year-by-year breakdown.
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Net Worth
Add up the value of your assets - subtract your liabilities, and you will arrive at your net worth. This calculator can help you determine if you have a positive or negative net worth and how it could increase or decrease over time.
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Life Expectancy
No one knows for certain how long we'll have to enjoy our retirement years, but we all need to ensure that we have the income plan in place to enjoy them. Estimate your life expectancy based on simple statistics such as your current age and gender.
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R R I F
A registered Retired Income Fund (RRIF) plays an important role in funding your retirement years. Use this tool to calculate different payment options from your RRIF including your minimum required payments.
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Risk Tolerance
Your individual appetite for risk will help to determine your investment choices. Use this calculator to profile your risk tolerance - an important first step in creating a balanced portfolio.
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