Retirement Planning Vancouver | Canadian Retirement Benefits
Do you have enough saved up to live the way you want at retirement?
In this article you will learn how to utilize the Canadian Retirement Benefits to insure you are secure and successful at retirement. Three of the barriers to retiring happily ever after is due to not thinking about retirement, not having a retirement strategy in place, and focusing on assets but not income.
The first barrier to not having enough saved up for retirement is not putting enough thought into your retirement. Too many people do not look at what they have for retirement until it is time to take the money out. There has been a major shift in how people save for their retirement fund. The defined benefit pension that existed years ago is no longer available. In the eighties there were sixty percent of employees covered with a pension plan, thirty years later only eighteen percent have a guaranteed pension. That is a huge decrease in a brief period of time.
Get a strategy in place to succeed
Putting a strategy plan in place to save for retirement sounds simple but 67% of Canadians are uncertain of how much they will need at retirement. To plan for your retirement income properly there are things that are necessary to know in order to get to what you want at that time. The problem is many people do not know how long they will need funds as well as how rising costs will affect their retirement income.
In the past people needed to think about when they would retire. Now the questions that should be asked are how much income will be needed, how long will the income be needed, where will retirement be, and what happens if you need long-term care?
The last hurdle…
The third barrier to planning for retirement income is focusing on assets but not on income. When building wealth, the focus is on accumulation. In retirement it is the need for a guaranteed income for the rest of your life. The messaging around retirement puts so much focus on accumulating wealth but not on how to use that wealth to build a lifetime income.
Main stages for retiring happy in Canada
To help you retire happily ever after you will need to figure out what retirement means to you. Do you want to travel, or be a lazy person? Financial freedom is usually what people consider in a happily ever after retirement. Within your retirement life you will move through three stages according to Tom Hegna author of “Don’t Worry, Retire Happy.” The first stage is a go go stage. This means you will have the ability to do all the things you want to, and you will do them. Things like travel, golf, and other fun hobbies will be your priority.
The second stage is the slow go one. You will still be able to do the same activities, but you will not necessarily want to do them. The third stage that many more people are making it to because of the advancement in medicine is the no go stage. This stage is when you cannot do the activities anymore because of immobility or dementia. All these phases require a steady income that requires planning.
What is hybrid retirement?
Did you know that almost half of the retired workforce in Canada is utilizing a strategy called hybrid retirement? They remain in the workforce but only work a few hours a week. This helps their bank account and mind stay active. They can even keep some of their health benefits too.
Can’t ignore inflation forever
Something to always watch out for is inflation. How old you retire as compared to when you will die will change the how much risk there is to being affected by inflation. If you retire at 70 but only live to seventy-five you will not be affected by it in your retirement years. On the other hand, if you retire at 55 and live to your nineties you can expect your buying power to be cut in half.
You can see why inflation needs to be factored in to not only how much wealth you accumulate but also how you use the wealth to combat inflation. The average life expectancy of a man is eighty-five and for a woman is eighty-seven. Being married adds another 5-7 years to that.
Too many accounts is a bad thing
You will want to consolidate your accounts to help you retire happily. When you have more than four piggy banks to manage your expenses and income you are creating additional and unnecessary stress, clutter and confusion. One piggy bank should be dedicated to current bills, the second for guaranteed lifetime income which would include pensions, benefits, and deposits, the third piggy bank is for investment funds and the fourth is for emergency funds.
Long term care is something that must seriously be considered and planned for. Ten percent of Canadians need it by the age of 55 and 50 percent need it by the age of seventy-five. A good insurance plan is a perfect antidote to this legitimate concern.
If you have read to this point and realized you do not have all these things in place but feel overwhelmed on where to begin planning, the next step is to work with a professional. Statistics confirm that people are much happier at retirement when they have worked with a professional to help them plan it out. If you are looking for a trusted financial advisor to help with this stage in your life, Thomas C. Chan is your guy.
He has helped countless Canadians retire happily. You can get a personalized consultation with him by visiting thomascchan.com or calling 1-604-877-4211. In this consultation Thomas will share what you need to know before you even work with a financial advisor. You may believe you do not have enough time to meet, but if you really think about it, you do. When you are planning for a vacation so you can enjoy it to the fullest you take the time to do so. Think of retirement as your ultimate vacation. This will help you to find the time to plan for it.