Financial Literacy

A few years ago I attended a retirement planning workshop offered by my employer. I didn’t think I really needed it as I was years from retirement; however, it was one of those all day events and I was in need of a break from my daily work routine.

After listening to speaker after speaker talk pension lingo I realized I knew little about, I knew I had to start planning for my future.

The first thing I did following that informative day was book a session with a financial planner. Of course not everyone needs financial planner, however, for me it just helped me focus on what I had to think about for my retirement and start planning for that stage in my life. Talking to a professional will assist you in figuring out how much you need to put aside and when you will be able say goodbye to paid work.

retirement planning

Between the advice and guidance from the financial planner, and the many retirement planning websites available to Canadians, I’ve been preparing for the day when working to live is no more. I’ve done some research and analysis of my needs and desires and think I am making progress on my retirement plan.

Here are some things I’ve learned from my experience which can hopefully help guide your retirement planning.

  1. Attend A Retirement Seminar. If your employer doesn’t offer retirement planning seminars, check with your human resources department, financial institution, credit counselling agency or online to find one that suits your needs.
  2. Prepare A Budget For Your After Work Life. What will you need to live on?  You should have less work related expenses, such as taxes, pension contributions, long term disability contributions and commuting expenses.  Will you live in your home, downsize or pay rent? Will you travel more or less? What hobbies or activities will you participate in?
  3. Pay Down Or Pay Off Your Mortgage. One of the most valuable things I learned from my retirement planning is that I need to pay down or pay off my mortgage. I don’t want to be retired and have a large mortgage payment.
  4. Review Your Life Insurance. My term life insurance was purchased when I needed to ensure that my son was looked after. Now that he is on his own, my insurance needs are different, so my policy is much smaller.
  5. Determine Your Canada Pension And Old Age Security Benefits. As you don’t get an automatic pension statement each year (or at least I don’t) I had to find out exactly what type of public pension I would get. I got an online account and can sign in through my bank which allows me to see the pension I can expect at 60 and 65. I’ve also been reading up on the different perspectives on when you should take your Canada pension plan and they are useful reads.
  6. Update Or Create A Will. My will was done when I needed to ensure that my son was looked after, so things like executors and beneficiaries are now different. I updated it a few years ago, but now realize that it has to change again so just visited a lawyer to make more changes. It always helps to get professional advice to ensure your wishes are carried out and if your situation is simple, it can be very affordable.
  7. Read About Retirement. As part of my preparation for retirement I have also read books from the local public library, and made use of many free online and other resources. There are many books you can borrow or purchase which give you advice on things you need to do for retirement, investing in retirement, and much more. The pensions section of the Government of Canada’s website and the Financial Consumer Agency of Canada are two great sources of information. Banks and credit unions, insurance companies and related businesses or organizations also have online retirement calculators and other resources.

All the work in the past few years makes me realize that I should have been paying more attention to retirement planning when I was much younger. I also know that it is never too late to start.

If you are wondering where to get help with your retirement planning, reach out to a not-for-profit credit counselling agency. They will be happy to assist and point you in the right direction!

Submitted by: Joan Butler, Board Member, Credit Counselling Canada

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