Everyone needs to be concerned if they have saved enough money for their retirement.  This is very important because of the following reasons:

• Life expectancy in Canada is around 82.81 years and it is expected to increase due to our improving healthcare system. This means you are expected to live 20 years of your life after retirement without working.  So, you need to have enough savings to cover those years.
• Inflation is expected to increase overtime and this will affect your purchasing power. So, you need to save enough money to mitigate against inflation.
• Effect of baby boomers. It is expected that 90% of baby boomers will be due for retirement by the year 2030.  Therefore, there will be pressure on government social security, and this may trigger taxation.
• Another important reason is you want to save enough so that you can retire early. You do not have to work until age 65 to retire, nor do you want to go back to work when you are in your 70s.  So, you need to have enough savings for your retirement.
• Some expect their children to take care of them in old age. Though it is a good idea, remember your children may also be struggling to make ends meet, and caring for their own children and saving for their own retirement.  So, you are going to be a challenge and burden to your children in this case.  This might cause problems for your children and their spouse.  I am sure you do not want

Find the below resources available for you to save money for yourself in order to have a peaceful life in retirement.

SOURCES OF FUNDS AVAILABLE FOR RETIRMENT

8. Government OR Company Pension: This is available for those who work with government or those who work with companies that have retirement pensions for them.
9. Canada Pension Plan (CPP): This is available for those who have CPP deducted from their job income over the years.
10. Old Age Security: This is available for those who have spent 10 years or more in Canada from 18 years old.
11. RRSP: This is available for those who have saved money in RRSP over the years.
12. TFSA: This is available to those who have saved over the years to their tax-free savings account.
13. Life Insurance Cash Value: Available to those who have permanent Insurance that have built up cash value over the years
14. Critical Illness With Return of Premium: Available to those who have Critical Illness with Return of Premium rider and did not use it.  Their premium will be refunded and will form part of their retirement benefit.
15. Principal Residents : This may be available to those who may decide to downsize their house and add their gains to their retirement plans.

It is also important to know that your income will be taxed at retirement depending on your source of income.  Some incomes are taxable and some are tax-free.  Find below the lists of taxable income and tax-free.

Taxable Income at Retirement:

• Government/Company Pension
• Canada Pension Plan (CPP)
• Old Age Security (OAS) (can also have clawback)
• RRSP
• Capital Gains on your investment in Mutual Fund
• Rental Income

Tax Free Income at Retirement

• TFSA Account
• Fund Value from your Permanent Life Insurance
• Critical Illness fund or Return of Premium
• Principal Residents

A lot of people are shocked at the amount of taxes they must pay at retirement.  Advanced knowledge and access to the right information will assist you in planning your retirement savings wisely so that you don’t pay high taxes at retirement.  Email me for more information and counselling on how to plan for your retirement