Bennett Financial Services

Retirement planning is a significant part of anyone's financial plan because one's retirement is that time of life where many of life's goals will be satisfied.  There should be time now to experience and accomplish the many wishes an desires that one was not able to do because of career, family other commitments.  In order to obtain the most from your retirement, it is important that you understand the process of retirement planning and that you take appropriate action now to put you in a financial position to enjoy the 'twylight' of your life. 

A good retirement plan will explain the rationale of establishing and contributing to a Tax Free Savings Plan and to either a Managed or a Self-Directed Registered Retirement Savings Plan.  Several questions have to be considered with regard to these two plans including how much should you contribute, should you borrow to contribute, can you carry contributions forward, when should you contribute, what happens if you withdraw funds prematurely, can you contribute to your spouse’s plan, and when can you roll other funds or allowances into your plan.  A good retirement plan will help your to understand the contribution side, the performance side and the withdrawal side of your tax free savings account, your RRSP’s and your RRIF’s. 

One is allowed to contribute to an R.R.S.P. until Dec. 31st. of the year in which you turn 71.  During all of these years in saving in this plan you have been allowed to defer tax on the contributions and on the accumulated earnings.  At or before the above date, you must collapse the plan.  There are a variety of ways of doing this; one should choose the method that is most appropriate for you, your spouse and your beneficiaries.  Revenue Canada allow four basic options; they include withdrawing your funds in cash,  purchasing a life annuity, purchasing a fixed term annuity, or transferring  your R.R.S.P. funds into a Registered Retirement Income Fund ( R.R.I.F. ). 

A good retirement plan will also take your individual situation into consideration and provide the most appropriate course of action for you.  It will discuss the various investment choices for you and offer a procedure for choosing an institution to help you set up these plans.

It will integrate your plan with other available pensions including Old Age Security, Canada Pension Plan ( C.P.P.), and corporate pensions.

It will discuss the value of your using your personal residence in your retirement planning, the use of reverse mortgages.

It will integrate the other investments in your program with your retirement investments.

In conclusion, a well thought out retirement plan will help you meet your life goals and give you tremendous peace of mind.

For a clear understanding of the terms being used, the issues involved, the necessary steps to be taken and for a step by step check-list procedure of how to adequately plan your retirement, read the chapter on ‘Retirement Planning’ in Bennett Financial’s ‘Checklist Guide to Financial Independence’.  To get a copy, click here.