This is what planning for retirement is all about. Whether you are thinking about it or are already retired, we can help you walk through it every step of the way. Our goal is to ensure that your retirement years are worth living every single day by creating tailored solutions to fit your finances, lifestyle, objectives, and goals.
Are you approaching the end of your working career?
Do you know what you’ll live on? Are you considering any pension option and why?
Have you thought about the collection of social security or how healthcare will be catered for?
What is Retirement Planning?
Retirement planning is a life-long process that involves determining the retirement income goals and the plan that is to be actualized in pursuit of such goals. It can be done at any time and takes into account current assets and sources of income as well as future expenses and liabilities. It involves identifying the source of income, estimating expenses, creating a financial saving strategy, and analyzing assets and risks management. The future of cash flow is then estimated and regulated as per the retirement income objectives and goals.
How does Retirement Planning work?
- Ensure that all your RRSP are turned into RRIF before you turn 71.
- Choose a plan of investment for your money.
- The annual minimum withdrawals will be determined by the government but you have the freedom on how much you can withdraw within the minimum amount that has been made available to you.
- The RRIF withdrawals are treated as employment income and therefore taxable.
Retirement planning plans / Ready to retire? Savings to Income!
Registered Retirement income fund
Registered retirement savings plan helps you save and plan for retirement through contributions while a registered retirement income fund requires you to take minimum withdrawals annually from the savings to help you ease into retirement.
When do you need RRIF?
- When you are about to retire and need to plan for your finances.
- After you’ve retired and you required an income from your RRSP.
What is the difference between Registered Retirement Income Fund and Lifetime income Fund?
There are different types of retirement savings that can be turned into income. Whether it is pension, plan or RRSP, the Registered Retirement Income Fund and Lifetime income Fund can help you get an income from those plans.
RRIF converts RRSP savings while LIF converts pension savings into retirement income.
RRIF provides only minimum annual withdrawals while LIF provides both minimum and maximum annual withdrawals.
Benefits of Registered Retirement Income Fund
It is flexibly characterized by the ability to make withdrawals at any time with no maximum limit.
The availability of estate planning gives the freedom to designate funds from RRIF to the beneficiaries.
Income Annuities
Investing in the annuity is a sure way of guaranteeing retirement income. After spending the larger part of your years in the workforce, the next phase of life maybe is thrilling or scary. An income annuity is a way of creating income that is guaranteed for life. Establishing income annuities can help you cover most if not all of the basic necessities during retirement while still having the chance to invest in other investment opportunities that present a chance of financial growth.
What is an Annuity?
An annuity is a retirement planning option that gives you the freedom to turn a section of your earnings into a regular income for a particular period. The payments don’t depend on the faltering on the market. RRSP can be converted to an annuity. The aim of the annuities is to ensure you have financial support regularly to cater to your essential expenses and retirement lifestyle.
How does an annuity work?
- With expert advice, analyze your retirement plan with a focus on your retirement date and your current regular income.
- With this information, you can go ahead and make a large amount of deposit into your savings and choose the period of your life that you wish to be receiving the money.
- The choice of withdrawal will depend on if the partners are a couple and the duration between payments.
- Annuity can be customized to meet the needs of the beneficiary.
Types of Annuities
- A single lifetime income annuity.
- Joint (couple) lifetime income annuity.
- Term annuity regular income.
Benefits of income Annuities
- Guaranteed income
- Customizable options
- Predictable
Who should consider Income Annuities?
- Those who are almost retiring or already retired.
- Those looking for a lifetime secure financial pay-check.
- Interested in steady income regardless of the fluctuating market.
- In need of income before the government retirement plans begin.
- In need of converting savings to a guaranteed income stream.
Lifetime Income Benefits
Lifetime income benefits give you the chance to secure a retirement source of financial benefits with a chance to earn extra benefits. The longer time you take to make the withdrawals, the larger the growth of benefits.
What is lifetime Income Benefits?
Lifetime income benefits is an option under segregated fund policy that is highly recommended for those people who are looking for a retirement plan that gives them an option to turn their savings into a stable income. It has the capability to generate income for the rest of your life.
How does Lifetime Income Benefits work?
LIB is an available option for all those who are between the ages of 50-90 years and have segregated fund policy. You just have to add it.
If you have a spouse, you can create a joint-life income so that you all receive steady financial support during your retirement years.
The initial income is subject to the percentage contributed and based on your age when you first make the withdrawal.
The longer you take to make your first withdrawal, the higher your chances of having an increased income. With every year of waiting, there is an increase of 3% bonus.
The income is always calculated after every 3 years and as you age and markets grow to the better, your income will automatically be better.
Who should consider LIB?
- Those who want to receive a guaranteed income.
- Those who want to invest in the market without the risk of losing everything.
- Those who need to top up employee pension.
- Those who don’t have an employee pension.
Benefits of LIB
- The chance to have increased income.
- Lock-in gains which lead to increased income as per the market.
- Offers flexibility in start dates.
What is HelloLife?
HelloLife provides you with an income from both annuities and segregated funds. Annuities provide a sure and secure way of financial funding while segregated funds provide an opportunity for the potential for growth and flexibility. When the two are combined, you are guaranteed of financial income to maintain your lifestyle for life as well as the advantage of potential growth.
How does HelloLife work?
With the guidance of retirement planning advisor, map out the goals and objectives of your financial planning putting into consideration your basic needs, liabilities, and general lifestyle. This should be able to outline for you what retirement should look like by the time you get there.
From there, you can determine how much of your savings can be turned into annuity and how much should be invested in segregated funds policy. The savings in your annuity are meant to provide a secure financial backbone because they don’t rely on the fluctuations of the market while on the other hand, segregated fund policy has the potential for growth and flexibility on your investments including insurance protection.
When should you get HelloLife?
- Almost retiring
- Retired
Benefits of HelloLife?
- Guaranteed income
- Investment for growth
- The right balance for you
- Well outlined and productive retirement plan
Pension plans
As you retire, you will need a stable financial plan that will help you walk through life that doesn’t present a stable monthly income. Pension allows you as an employee to get an advantage from your workplace that can be of help in your retirement.
What is a Pension Plan?
A pension is a form of a retirement plan that is offered by the employer as a transition between personal savings and retirement necessities. The biggest advantage of the employer pension plan is that it offers stronger buying power given that the contributions are pooled and invested together in a segregated fund. Some firms and employers offer to match the portions of what you contribute.
Benefits of a Workplace Pension Plan?
- Convenience
- Diverse options of holdings
- You start with any amount
- Flexibility in contribution
- The flexibility of choosing the risk that applies to your needs
- The lower costs that lead to greater savings
Preparing for Retirement
The concept of retirement has become more understandable if you take time to analyze, get expert advice, and plan for it every step of the way. You need to be ready for the responsibilities and liabilities that come with retirement. The analysis below should help you achieve that:
Transitioning to retirement life should be a process that helps you cope better for the times that you will be out of the consistent paycheck. Finding the right financial strategy that ensures you maintain your lifestyle and still be comfortable is a very important aspect of planning for retirement. These transitional steps should help you figure out how to approach retirement planning according to where you are in life:
Create an estimate of your funds from both the government and the employer. Do they align with your lifestyle and expenses? Is there anything you will need to cut on or re-adjust? This analysis will ensure that you make the necessary right adjustments as advised by the experts in finding the best stable ground for your retirement plan.
Outline all your sources and confirm eligibility.
Review all the estate planning as you work with your chosen advisor to customize the program to fit your needs.
Have the information updated especially on beneficiaries as well as the application of all government beneficiaries. Ensure that the application for the retirement plan from your place of work has been submitted.
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Stages/steps of retirement planning
Set your retirement goals
Listing your retirement goals that highlight the basic needs and inner dreams that you’d like to achieve. Have them organized in short, medium, and long term brackets and assign the appropriate amount where need be.
Analyze the current financial position
Taking a stock of your current financial statement gives you a proper outlook of what assets and liabilities retirement will bring you or deny you. The stock should also include your retirement budget in regards to your expenditure and lifestyle maintenance.
Identify retirement income sources
Retirement income sources may be diverse and may include pension, social security, IRA accounts and other savings or even part-time work. You should also consider and determine the after-tax and timing.
Retirement Risk Evaluation
Consider all the available risks that may affect your retirement income including inflation and the faltering of investment markets.
Understand healthcare issues
Health insurance is most of the time subject to age. Depending on the retirement age, you may need to secure your old age health care financial needs. You will need to carefully evaluate your health situation to come up with a plan that actually caters to your needs.
Invest in your retirement assets
Create an investment policy statement with a clearly stated asset allocation that will act as your retirement investment guide. Ensure that the policy outlines diverse investment options, is in line with the end goals and the time frame as well as risk tolerance. T is also important to understand the character and nature of the assets in relation to the taxes.
Monitor your retirement assets
Keep track of your financial situation by periodically assessing the available sources of income and assets. The assessment of the withdrawal rates is essential in determining the sufficiency of the assets in funding for the retirement liabilities. The goal is to maintain a stable withdrawal rate strategy.
Management of retirement income
You have to understand that at retirement, you don’t have that one stable source of income. Instead, you get financial support from different sources which will require proper management, planning, and monitoring.