With its “Freedom 55” ad, London Life made age the most important factor in retirement.
Oh! How things have changed over the past few years. We talk less and less about the retirement age (except our politicians), but about the concept of retirement. What is retirement today and what kind of retirement do people envision?
What is retirement?
Bye Bye Boss: many people will be able to retire by suddenly severing their employment relationship. But for many it is something else entirely. I invite you to read this excellent article from the Journal Le Bel Age which can be summed up as follows: “Retirement has no meaning if it is only for fun. We must continue to learn, to achieve and to be useful to society”. To read the full article: click here
Our society requires us to live at 100 miles an hour. Do you think you can drop to zero when you retire? Some retirees return to work to fight boredom, but others for lack of money, I agree.
Retirement is no longer just a matter of age! What will I do with my time and will I have enough money?
Evaluate your financial needs in retirement.
Tricky question if there ever was one.
Take a white sheet of paper and divide it into two vertical columns. Left: How much does it cost me today for… clothes, food, etc. In the right column, how much will it cost me at retirement? Do not forget the extras (travel…). Do the same for income and estimate your annual deficit that you will need to cover from your retirement fund.
Simplistic, you say? Maybe. But when it comes to your dream retirement, the expert is you!
Let’s talk about it together!
TFSA or RRSP
Another question increasingly debated by experts. If your taxable income (earned income less basic exemptions) is below $50,000, your tax refund will be around 35% for every dollar invested in an RRSP. When the time comes to withdraw money from your RRIF at retirement, you will have to tax yourself both on the capital invested and on its growth.
The amounts placed in a TFSA are not deductible from your taxable income, we agree, but neither the capital nor its growth will increase your withdrawals or influence your old age security pension or your guaranteed minimum income.
RRSPs and TFSAs should be part of your retirement strategy, regardless of your income level.
Let’s talk about it together!
Life insurance or health insurance
You are 35, 40, 50 years old and we have established a retirement strategy that allows you to anticipate a happy retirement without sacrificing the present.
Twenty-five years ago, we talked a lot about life insurance, but today we have to change our discourse. Did you know that an individual between the ages of 35 and 50 is much more likely to have a serious illness or become disabled than to die. Look around you, the cases of cancer, cardiovascular diseases are multiplying. People survive it, but often by gobbling up their retirement funds.
Any retirement strategy should take into account the high probability that you will be affected by a serious illness before reaching it.
Let’s talk about it together!
As far as my retirement is concerned, I no longer speak of Liberté 55, but of Liberté tout court!
