I’m thinking about retiring but I’m not sure if I’m ready. Can you help?
Assessing retirement readiness is an important task most of us will need to face at least once in our lives. There are many personal factors to consider, like the emotional and social impacts of stopping work, but let me offer some helpful financial advice. First, try to picture what you want your retirement to look like and determine the amount of money you’ll need to retire with. There’s a big difference between puttering in the garden and going on five-star cruises all the time, so be realistic. The next step is to figure out how much income you’ll receive during your retirement, from the government with Canada Pension Plan (CPP) or Old Age Security (OAS), and from any private pensions you may have. Finally, take stock of what you have saved and calculate the cash flow these savings will generate for the rest of your life. If you identify a shortfall between the money you’ll need and the money you’ll have coming, there may be steps you can take to address this, one of which might be to enlist the help of a professional advisor. The sooner you start retirement planning, the better.