How to Bring Your Retirement Vision to Life

Sometimes retirement is hard to visualize even when you’re close to it.  All the advice on how to prepare for retirement consists of socking away as much as you can until you’ve built a nice nest egg for when you’re done working.

Life as you know it will be over, but that doesn’t mean switching to wearing elastic-waist pants and knee socks with sandals on your way to the Shady Rest Retirement Home.

It’s fine to take off a few months to relax and sleep in, but sooner or later you’ll want to do something productive with your time.  Now is the time to think about how you will spend your days – up to 40 years worth.

Know yourself

Your emotional preparations for retirement are just as important as the financial ones.

At work you have an identity that is tied to your job title.  Once you retire you have to get a sense of what your new path is going to be.  A CIBC poll found that 90% of Canadians have no detailed plan that outlines the lifestyle they want in retirement.

Take some time to think of what your retirement personality will be.

What does “happy and safe” mean for you?  You can’t make money decisions until you know why you’re making them.  Is it to protect your spouse’s safety if you die first?  To have enough and give away the rest?  To spend your last dollar on your last day?

Related:  Practice Retirement While You’re Still Working

Your wealth

Now is the time to review your potential income stream in retirement and understand your future spending.

If you decide to retire before age 65 your income will be reduced substantially.  If you have a company pension plan, benefits will be decreased by up to one third.  Canada Pension Plan payments will be reduced by up to 36%.

It’s worth spending some time figuring out which age is best for you to start taking CPP benefits.  Various tax and income factors will influence whether you start payments at the standard age of 65, or start early or delay as long as possible.

You have to make a decision about the Old Age Security which you can begin to receive between 65 and 70 years of age.

Think about whether withdrawing money early from your RRSP makes sense for you, or defer for as long as you can to allow it to grow.  Be aware that if you wait until it’s compulsory to convert it to a RRIF, withdrawals at age 72 will most likely cause your income to rise.  You might face a clawback of your OAS.

Make a concerted effort to pay off your debts while you are still employed, especially expensive credit card debt. Obviously, being debt-free will free up money in your budget to save more and, later, to spend as you like.

Your health

Nothing is more important than your good health.  A good diet, exercise and regular check-ups are more important than ever at this time.  Keeping active and your mind interested staves of depression, which can reduce your life expectancy even if there are no other signs of illness.

Make a doctor appointment to establish some healthy lifestyle goals for retirement.

If you’re lucky you will be able to keep the health and dental plans from your workplace.  If this isn’t the case for you, check out the cost of private or government health and drug plans.

You may also want to check into critical care or long term care insurance now.  These plans can be expensive, but if you don’t have substantial assets that can pay the exorbitant costs of institutional care, they may be well worth it.  Some plans have a return of premiums if the insurance is not required.

Your happiness

Many of us are trying to figure out what to do with all this free time and others know exactly how they will spend their retirement years.

Some people want to laze around home, read books and putter around in the garden.

Travel is popular option, especially for the first few years.  Finally having the time to pursue favourite hobbies or discover a new interest is something to look forward to. Some people decide to volunteer more often for their favourite charities or devote time to family. 

Try some things out before retirement to make sure you really want to pursue them more regularly.  Make sure you have sufficient funds for what you want to do.  Reevaluate as necessary.  You may be retired for as long as you were employed. 

Re-invent yourself.  Have fun.

Where will you live? Start thinking about it now.  Retire in the best place possible for you.  It may mean staying in your family home, moving to another neighbourhood, or a different city or province.  You might even want to go to another country, full or part-time. 

Related:  Canadian Snowbirds:  What You Need to Know

In any case think about factors such as climate, housing affordability and access to health care.

The bottom line

How people visualize their retirement is different for everyone,

There’s no longer a one-size-fits-all approach for planning for your retirement years. What worked for your parents, co-worker or friend may not necessarily work for you.  You don’t want to follow someone else’s plan anyway. 

And it’s about a lot more than just money.  Think also how your new identity, relationships and support systems will be impacted once your working life ends.

Your mindset is important because it affects your actions and decisions before and during retirement and how satisfied you will feel.

Whatever your goal, having a clear plan is fundamental to making your retirement vision a reality.

Ensure that your retirement is rich—not just in finances, but also in new and rewarding experiences.


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2 Responses

  1. Peter says:


    After being retired for almost 3 years…we remain dry active simply put -This blog nailed it!!!

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