Retirement is something that may be on everyone’s mind from time to time but without a comprehensive written plan, most fundamental issues will be left to chance. When will you be able to retire? Will you be able to afford the lifestyle you want? Will you need a part time job? Even after retirement, wondering if you have enough assets to support yourself and your family for your life expectancy is one of the most critical topics to address today.
There are many, many areas to look at when creating a retirement plan. To start, you’ll need to know how much you have saved in various investments like RRSP’s, LIRA’s, TFSA’s, Non-Registered Investments, Business Interests and the value of your Government and Company Pension Plans and Real Estate. All of these will make up your gross retirement income and from there, after tax income can be estimated. You also need to think about the age you’re planning to retire and life expectancy; how your future health may affect retirement costs, the impact of inflation and market volatility; changes to your principal residence, your succession plans and potential inheritances, and so on and so on. Some of these factors are within your control, but some are not.
Given all these contributing factors how can a meaningful after tax retirement income budget be calculated?
Your Retirement Map™ is a program that we have developed to help our clients identify the various types of income that may be available and to provide a projection of your after tax income in today’s dollars. Your Retirement Map ™ uses a process, where applicable, to suggest the type and income value that should be withdrawn from various sources to minimize tax and maximize sustainability of income and for you and/or your estate. When this process is repeated every year, this allows you to adjust savings levels, investment design and risk and perhaps even adjust retirement dates and lifestyle plans before retirement so that your transition from employment to retirement is as smooth as possible. Your Retirement Map™ is a great first step to understand your retirement future.
Financial Tips for Retirement Income Planning
While everyone’s retirement planning is different, there are some general tips that are great to keep in mind when planning your income for retirement.
You’re never too young (or old) to start planning
No matter your age, retirement income planning should be on your mind as a financial priority. Too many people under 40 think they’re too young to start planning for retirement, but the younger you start, the larger your retirement income will likely be!
On the other hand, many people who have waited until they’re older to start planning for retirement often see it as a waste. Remember, if you start planning your retirement at 50, it’s better than starting at 60. If you haven’t started at 60, it’s better than starting at 70. It’s never too early or too late to begin planning your retirement income.
What do you want your lifestyle to be like? Do you want to travel? Will you work part-time? Setting goals for your retirement will help you better understand the retirement income planning options available to you. It will also help you invest your money in the right places to achieve the goals that you set for yourself so you can always be improving your retirement income plan.
Get financial advice from a professional
Planning for retirement differs from person to person. There’s no one solution or plan for everyone. This is why it’s beneficial to work with Stephen Fricker of Westdale Financial Services. Steve is a Certified Financial Planner and can help you determine the most suitable investment strategy to maximize growth and minimize losses… a crucial combination as your retirement age approaches.
Contact Westdale Financial Services to see how our unique program, “Your Retirement Map”™ can give you an insight into your retirement income future and help you make lifestyle plans that are feasible and achievable.