Retirement planning

Retirement planning services ensure your money is invested in a diversified portfolio of financial products, including stocks and bonds*. Your retirement plan will be personalized to you, and you can choose from multiple levels of access to your money—including Tax-Free Savings Accounts (TFSAs), Registered Retirement Savings Plans (RRSPs), Registered Retirement Income Funds (RRIF) and more.

The 70% retirement rule is a guideline that suggests your retirement savings should be enough to replace 70% of your current income each year. To put it in a clearer context, let's consider an example:
 
Imagine you currently earn $80,000 per year. According to the 70% retirement rule, you should aim to have retirement savings that can provide you with $64,000 per year once you retire.
 
However, it's important to note that this rule assumes your expenses will decrease in retirement. For instance, you may no longer need to spend money on things like commuting to work or raising a family. This might not be realistic for everyone, as individual circumstances can vary.
 
While the 70% rule is a good place to start, an advisor can help you create a personalized budget and retirement plan tailored to your specific needs and goals. This way, you can ensure that you have enough to retire comfortably, while still living the life you want to live.

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An RRSP is a type of registered plan that lets you invest your money for retirement. Contributions to an RRSP are tax deductible, and your investments grow tax-free until you retire. At retirement, the amount you withdraw from your RRSP will be taxed at your marginal income tax rate.

Registered Retirement Savings Plans (RRSPs) are designed for saving and Registered Retirement Income Funds (RRIFs) are designed for withdrawing. Both allow you to earn interest on your savings, but an RRIF lets you withdraw money regularly during retirement without facing penalties. After you turn 71, the government requires you to convert your RRSPs to RRIFs and to withdraw a certain percentage annually.

Once you convert your RRSP to an RRIF, you can maintain all your existing investments—including stocks*, bonds*, term deposits, mutual funds* or Exchange Traded Funds (ETFs)* — but you can no longer contribute new money.

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The retirement age in Canada is 65, but you may choose to retire before or after this age, whenever is right for you. You can start receiving your Canada Pension Plan (CPP) benefits as early as 60 or as late as 70. Additionally, you may begin receiving your Old Age Security (OAS) payments at 65. You may defer your OAS payments beyond 65 if you prefer. The earlier you start receiving your pension, the smaller the monthly amount you'll receive.

To retire in Canada, most financial experts believe you need to have between $700,000 and $1 million in retirement savings. However, this is just an estimate—the amount of money you need depends on your individual circumstances and goals. 

If you're wondering how much you need to save for retirement, contact our advisors to get an accurate estimate.