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Plan Well, Live Well, Retire Well: Why Pre- and Post-Retirement Seniors Should Have a Financial Plan

Today's article will focus on the importance of financial planning and the impact it can have on your life and lifestyle post-retirement. There are five topics that will be touched on and are strongly advised for anyone who is in or getting ready to enter into retirement. One should take these issues into consideration and speak to a professional about what you can do to prepare yourself and family for post-retirement.

Preparing a Financial Plan Having a financial plan is a great tool that outlines your financial goals and the steps you must take to get there. Even if you are already retired, having a plan helps you keep track of your expenses and allows you to adjust your goals given certain events or changing circumstances. When I speak with clients I always emphasize that everyone knows they will retire at some point in their life, but the critical focus should be “How do you want to live in retirement?” and “What kind of lifestyle do you want to have?”.

Having a financial plan in place gives you a flexible tool to estimate your lifestyle needs in retirement, what you need financially to prepare for the future and can also account for various events that could impact your retirement income, such as critical illness or requiring long-term care. A financial plan provides you the dignity and foresight to exercise control of your life and lifestyle post-retirement.

Managing Investments Pre- & Post- Retirement Regularly saving part of your income is important and investment vehicles such as RRSPs are a great way to maximize the impact of your savings through long-term investments. Withdrawing RRSP money while working full-time can lead to higher tax rates and may feel as if the investment is not worth it. RRSPs are meant to generate tax-deferred growth over time to be withdrawn in retirement when your overall income is lower and not likely to trigger higher tax rates. That being said, the investment mix you chose when you were younger may not suit your current or imminent retirement needs. Review your investment portfolio regularly to ensure that your investments can continue to provide your desired retirement income.

Preparing for the cost of Seniors Care In addition to any pensions, savings and RRSP income you may have, consider getting health coverage through Long Term Care (LTC) or Critical Illness insurance. If you ever reach a point in life where you are not able to conduct 2 of the following 6 Daily Living Activities:

* Eating

* Bathing

* Dressing

* Toileting

* Walking

* Continence

LTC insurance will become active and you will receive a weekly payout based on the amount you purchased. This can supplement your retirement income or even be large enough to resemble a working salary; Thus providing you the freedom to use your retirement income as intended, as well as receive quality care without having to use retirement funds allocated for other purposes. The same applies for Critical Illness insurance. Your retirement savings are important and it may be prudent for you to invest in the cost for health insurance now, in order to protect your savings against costly unforeseen health-related expenses in the future.

Creating a Legacy: Estates and Wealth Transference You have worked hard, lived well and are living comfortably in retirement. You’ve looked after yourself, but have you made preparations to ensure your family and loved ones are taken care of should anything happen to you? A will is one of the most important planning steps you can complete to ensure that your estate is managed the way you intend it to be. Without a will, management and disposition of your estate falls to the government and they will ensure that any taxes and fees required are taken first before seeing after your loved ones. Consider speaking to both a financial professional and a lawyer to make sure your estate is structured the way you want it and will be managed the way you intend.


Contributor: Michael Thorpe B.Sc, M.Sc.- Sun Life Financial Advisor
Michael Thorpe is a Sun Life Financial Advisor, who provides a holistic approach in working closely with clients to help them make the best financial decisions to benefit their short and long term goals.  Core financial areas of focus for Michael include:  Financial Assessments, Wealth Management and Life/ Health Coverage Benefits.  Contact: or 416.512.0400 ext 2298 ;


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