The first of the Baby Boomers turned 65 this year, and the number of retired – or close-to-retired Canadians is growing. Today’s Canadian retirees are mostly feeling good about their lives, but many still have financial concerns, found the TD Waterhouse Canadians and Retirement Report, a national survey of retired people. The majority of retirees polled aren’t confident they saved enough for retirement and have some advice for those next in line: start earlier and save more.
The top pieces of financial advice Canadian retirees wish they were told before retiring is: save more money than you think you will need (58%), pay off all debts before stopping working (28%), work with a financial professional (25%), and don’t leave the workforce too early (20%).
The good news is that 48% of Canadians say that their retirement is “mostly” what they were expecting, and 11% say it’s “exactly” what they had in mind, so the majority are living their retirement dream. ”
With 37% of Canadian retirees concerned they don’t have enough money to do what they want, and 23% worried about outliving their savings, it’s clear that planning and saving is needed in order to secure your financial future and live the retirement lifestyle you have in mind. TD Waterhouse offers the following tips to get your savings on track, regardless of your stage in life or financial situation:
Twenty years from retiring? Retirement may seem like a distant reality, but it’s important to start planning now. You don’t need to be debt free to start saving for retirement: if you contribute to your RSP and then apply any tax refund you receive from making the contribution towards paying down debt, you’ll likely be better off in the long term.
Ten years from retiring? The closer you get to retirement, the more important it is to take stock of your savings plan. Work with a financial advisor to monitor your progress and take corrective action if you fall off course. Consider your investment objectives, the time remaining to retirement and your risk tolerance, and map out an investment strategy that will let you optimize the returns on your RSP savings.
Five years or less from retiring? You’re almost there! Before you retire, allow ample time to plan what you want to do with the money you’ve accumulated in your RSP. When it’s time to convert your RSP, you might want to consider an RIF or an annuity. If you have more than one RSP or RIF, consider consolidating for ease and convenience. Having all your investments with one institution may also reduce your overall account administration fees.
It’s not just about money: retired Canadians share advice for those next in line
Almost three quarters (72%) of respondents urged boomers to take care of their health. They also suggested it’s a good idea to take time to understand what you want out of retirement (67%) and pay off debts (63%).
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