The second phase of the Financial Life Cycle is the Retirement Phase – the time to enjoy the fruits of your labour. In this stage, most people are planning their retirement income so they can have enough money to do the things they want while still coping with inflation and paying as little income tax as possible.
This stage requires a strategy that allows you to generate your desired retirement income from different sources, such as your RRIF or annuities, and make the most effective use of your pension entitlements.
When it comes to retirement income planning, there is no perfect method or simple solution. Every individual’s situation is different and everyone will have a different investment strategy for the best way to generate their desired income in retirement.
In retirement, you will have a combination of different income sources that need to be integrated. You will probably be entitled to some type of government benefit like Old Age Security and the Canada Pension Plan. You might have a company pension plan, or you may have your own personal savings such as a Registered Retirement Savings Plan and a non-registered account. Or you may have other investment sources like a Life Annuity or real estate.
When creating an investment strategy, we determine the income you will need to maintain your standard of living. First, we prepare a retirement income projection to illustrate the growth of an investment portfolio over a number of years. We also use projections to estimate the income that can be generated by a given portfolio during retirement. Then we determine how your different income sources can be integrated in the most effective manner to generate income (after-tax, after-inflation) in your retirement years.
When heading into retirement, you want your investment portfolio to be as tax efficient as possible. Taxes on distributions can reduce the return on an investment, so we organize your portfolio to minimize the amount of taxes being paid.
We use our disciplined process to determine what strategies will best suit your financial concerns, goals and objectives. Following our guiding principles, our experienced, professional advisors use a comprehensive planning approach to create a financial plan that best suits your unique situation.