As Retirement Transition Specialists, we’ve helped hundreds of Canadians retire with a wealth management strategy built on processes, knowledge, and experience.
‘What is a Retirement Transition Specialist?’ you might ask. Consider this analogy: If you needed heart surgery, you wouldn’t go to your family doctor. You would go to a heart specialist. Your traditional investment advisor is like your family doctor. But when things are more complicated or you want to concentrate on a specific area or outcome, you need a specialist. We focus exclusively on helping clients plan for the most complex period of their financial life: retirement.
During our years in the industry, we’ve learned that retirement is about so much more than money. It’s about supporting the lifestyle you’ve worked so hard to build. It’s about checking items off your bucket list. It’s about spending your time however you want, with whomever you want.
We’ve seen some great examples of how to make the most of your retirement experience. But we’ve also seen what not to do.
Here are ten things we’d never do when retiring:
Know what we’re retiring from, but not what we’re retiring to
When you stop working, there’s going to be a forty hour hole in your week. How are you going to fill it? Retirement isn’t just an extended vacation. It can’t be all travel and playing golf. If you don’t plan out how you want your day-to-day life to look like, your retirement will end up passing you by.
Retire without a clear picture of our finances
Now that you know what kind of lifestyle you want, how much is it going to cost? And where is that money going to come from? Building a retirement plan that ensures you have the income you need to live the life you want will eliminate the worry of running out of money.
Forget to stress test our retirement plan
Sit down with your wealth advisor and consider all the possibilities–personal, economic, geopolitical. Will your retirement plan still succeed under those circumstances? You need to know that whatever comes your way, you’re covered.
Retire without a tax plan
Tax is the single biggest expense most Canadians will have in retirement. And while paying taxes is inevitable, there are strategies available to help you reduce your tax bill. If you pay your taxes year by year without having a long-term plan in place, you’re going to end up having less money in your pocket to enjoy the lifestyle you want.
Underestimate the emotional impact of retirement
Change creates anxiety, and retirement is a big change! Think about all the things you got from your career – a paycheque, routine, identity, social connections. How are you going to process those losses emotionally when you retire? How are you going to fill those gaps in retirement?
Be overly optimistic about health in the future
Let’s face it . . . we’re all going to slow down and require healthcare at some point in our lives. You need to plan in advance for the level of care you want to receive and how you’re going to pay for it. Getting documents in order like a personal care directive and powers of attorney is an important step in the retirement planning process.
Believe our current living situations will last forever
Most Canadians want to age at home. But who is going to do the gardening or shoveling when you’re no longer able to? Have you budgeted for renovations to make your home more accessible as you age? If you do need to go into assisted living, what level of facility do you want? What level can you afford? These changes won’t happen overnight. If you plan for options in advance, you’ll be there when you need them. And remember, you don’t have to figure everything out alone. There are resources like Proactive Seniors available to you.
Fail to coordinate with our partners
Spouses may have a different idea of when to retire and what retirement actually looks like. That’s okay. You don’t necessarily need to have a shared vision. In fact, when you’re used to going off to separate jobs each morning, suddenly spending 24/7 together can be a little much. But you do need to understand your partner’s vision and find areas of commonality with your own. Find activities that you can do together, and activities you can do apart. Trust us, it will lead to a much more peaceful retirement experience!
Skip estate planning
We host a regular seminar for people to learn more about how we can help them plan for retirement (if you’re interested in attending, check out this page!). And at every seminar, we ask the crowd, “Who has chosen the Canada Revenue Agency as their main beneficiary in their will?”. And in all the years we’ve been doing this, no one has ever raised their hand. That’s because nobody wants to give more money to the CRA than they absolutely have to.
And nobody wants their family to fight over assets when they’re gone. The solution is having a clear plan to transfer wealth to the next generation in the most tax efficient way possible. This involves thinking about something nobody wants to think about: what happens to your family when you die? It involves having conversations. It involves making sure your will, powers of attorney, and other documents are up to date.
Go it alone
Retirement can be overwhelming. But the good news is you don’t have to do it alone. Working with an advisor who specializes in retirement can take a lot of the stress off. Planning for all of the variables in advance will give you the freedom and the confidence you need to enjoy your retirement.
Want more information about retirement dos and don’ts? Register for our seminar by clicking here.
David Popowich and Faisal Karmali are Investment Advisors with CIBC Wood Gundy in Calgary. The views of David Popowich and Faisal Karmali do not necessarily reflect those of CIBC World Markets Inc.
This information, including any opinion, is based on various sources believed to be reliable, but its accuracy cannot be guaranteed and is subject to change.
CIBC Private Wealth consists of services provided by CIBC and certain of its subsidiaries, including CIBC Wood Gundy, a division of CIBC World Markets Inc. The CIBC logo and “CIBC Private Wealth” are trademarks of CIBC, used under license. “Wood Gundy” is a registered trademark of CIBC World Markets Inc.
Individuals are advised to seek advice regarding their particular circumstances from their personal tax and legal advisors.
