5 Tips for the Soon-to-be-Retiree

Making the conscious decision to stop working and move into retirement can be difficult. There are many worries that go along with it, chief among them being concern for your financial health.

If you are nearing retirement age, here are some tips on how to approach your financial well-being before you make the change.

Assess your assets
At some point, you really need to sit down and make a list of the financial resources you have at your disposal. This initial meeting does not have to provide all the answers but it will give you a concrete starting point in formulating a financial plan.

Know your acronyms
Much of the juggling in retirement concerns drawing income from various sources: RRSPs, RRIFs, TFSAs, CPP, OAS, GIS, as well as your workplace pension plan (if you have one). Each of these potential income sources comes with unique advantages and its own set of rules regarding timing and payout amounts. The trick is to get to know how each one works — how they can affect each other — so you can figure out when and how to draw on each one to optimize their total value.

Find your balance
Income generation from investments becomes top of mind for retirees. Careful planning helps you draw sufficient income to support your lifestyle without triggering a high tax burden. The other balance you’ll need to find is how to enjoy continued growth to help your money last well into the future, while minimizing potential risk.

Time your move
Many of the decisions you make will require careful timing, as you structure your retirement finances. That includes any potential changes to your residence. If you own a house, do you plan to live there if possible, or sell so you can downsize and use some of the assets for income? If the latter, you’ll need to decide when to sell based on market predictions and your own financial situation, keeping in mind that buying a new home may need to be factored into the process.

Talk to your advisor
Financial planning is complex at the best of times, and retirement planning particularly so. Creating a strategy to maximize your financial resources while minimizing taxes and leaving a legacy requires expertise and careful consideration. Working with a financial advisor can help ease the decision- making burden and reassure you that you are on the right track to enjoy a financially successful retirement.

Your advisor works closely with insurance, tax and legal experts to create a well-rounded plan designed specifically for you.