Planning for retirement means having realistic expectations about how much you’ll earn and spend.
To achieve the retirement you want, you’ll need to arrive at an accurate estimate of how much you will earn - and how much you will spend. Use this simple checklist to figure out which income sources and expenses apply to you.
Retirement income sources
Group or individual Registered Retirement Savings Plan
Registered Pension Plan
Registered Retirement Income Fund
Tax-Free Savings Account
Non-registered investments (e.g., mutual funds, guaranteed investment certificates, Canada Savings Bonds)
Savings or chequing account
Money invested in your home (if you plan to sell before you retire)
Government sources (e.g., Canada Pension Plan, Quebec Pension Plan, Old Age Security, Guaranteed Income Supplement)
Company pension plan
Post-retirement income (if you plan to work in retirement, earn rental income, etc.)
Utilities (e.g., gas, hydro, water/sewage)
Home services (e.g., phone, cable, satellite, internet)
Car payments, including gas
Other transportation costs
Health and dental insurance
Health care costs not covered by insurance (e.g., certain prescriptions, orthotics, eyeglasses)
Travel and leisure
Entertainment (e.g., dining out, books, magazines, movies, sporting events)
Miscellaneous (e.g., clothing, personal care products, gifts)
Debt payments (including credit cards)
Once you’ve filled in this checklist, start thinking about how much you’re likely to earn or spend in each relevant category. Once you’ve done that, you can create an annual or monthly post-retirement budget.
You may spend 25 or more years in retirement, so remember to think about inflation, too. At an annual inflation rate of 3%, prices will double in 25 years.
This checklist may not cover all of your income sources or expenses. For more information, talk to your financial advisor and visit AGF.com/RRSP.
The contents of this Web site are provided for informational and educational purposes, and are not intended to provide specific individual advice including, without limitation, investment, financial, legal, accounting or tax. Please consult with your own professional advisor on your particular circumstances.