By Steve Bridge, BA (Hons.), FPSC Level 1TM
We know it can be daunting to take those first steps in planning for your retirement and it often seems easier to put it off for another day. But the earlier you start, the better prepared you’ll be and you’ll lose the stress that comes from worrying about the unknown in your future.
I’ve seen it first hand with many of my North Vancouver clients. The second we work together, confront their inaction, and begin putting a plan together, the anxiety and stress fades away.
Here are 10 basic – but essential – strategies and considerations to think about right now:
- Figure out how much your lifestyle will realistically cost you in retirement.
- Consider downsizing before you retire (think of it as a dress rehearsal for retirement). Can you get by with a smaller house or just one car or less expensive vacations?
- Pay down your debts more aggressively – starting today. Credit card loans and other such high-interest debts can add a tremendous burden on a reduced or fixed income.
- Run some retirement income numbers including company and government pensions. Many people dismiss government pensions but they can total as much as $18,000 per year per person and are more secure than many people realize.
- Become familiar with one of the newer tools to assist your retirement savings program, namely Tax-Free Savings Accounts.
- And revisit one of the older ones – annuities. These financial products are purchased from insurance companies and are designed to provide you with peace of mind by providing you with a safe drawdown rate through regular payments for as long as you live.
- Consider working past age 65 or working part-time, especially if you love your job or you want to try something new.
- Get aggressive with your savings. Even if you are in your 50s, you can add substantial weight to your retirement income by saving more today. What if you took all of the income that you used to spend on your children for education, food and clothing and put that in your retirement fund?
- Simplifying your life just might reduce your stress load and anxiety levels. Gearing down a notch or two can open you up to new possibilities of how you can live your life. Be creative in your thinking.
- Consider doing something meaningful with your retirement years. Without the pressure of having to show up on the job every day, perhaps you could dedicate some time to making the world a better place for your grandchildren. What would that look like for you?
If you want to be confident that you are on track for a comfortable retirement, hire a Money Coach or fee-only financial planner well before your retirement date. You can crunch the numbers and create a retirement plan yourself with the help of calculators and resources available in books and on the Internet, but be sure you have the expertise, time and motivation to do it!
Serving clients in North Vancouver, Steve Bridge is part of the Money Coaches Canada national network of Money Coaches. A Money Coach is a financial professional that helps clients develop a clear understanding of their current financial situation and create a plan that helps them reach their goals. Money Coaches Canada is the nation’s leading, independent provider of advice-only financial planning. Money Coaches do not sell investment or financial products.
