Essential tips for mature workers
For several years now, studies have shown that the Canadian labour force is shrinking. In fact, some conclude that we're now in a crisis situation. As a result, many older workers who would otherwise be retired have chosen to keep working. For some, it offers new challenges and a way to stay vital and sharp. But for others, it's a chance to ensure that they have considered all their financial needs for a successful retirement.
Three easy steps
Retirement tends to span up to 30 years for the average retiree. These easy steps will help mature workers prepare for the next phase in their lives.
1) Estate planning: This ensures that your children and grandchildren receive a solid inheritance that isn't whittled away by after-death taxes.
2) Fine tune your retirement income strategy: At the age of 71, your RSP account must be collapsed into a RRIF or Registered Retirement Income Fund. The goal at this time should be to protect your assets while maintaining some flexibility. Take time to consider the different products available and select the one that best suits your needs.
3) Worry-free retirement funds: Consider investing in a guaranteed minimum withdrawal benefit (GMWB) product. It is an investment that offers capital growth and safety, while providing guaranteed withdrawals regardless of how the market performs. Contract holders may choose to withdraw seven per cent of their initial investment over 15 years. If the market is doing well, they have the option to increase the number of years they receive payments, or they can collapse their account. GMWB products are RIF eligible.
By implementing these essential strategies, you will find that the transition into retirement will be built on a solid financial foundation. And this truly is the secret to a happy and prosperous future.
Melissa MacQuarrie, BBA, CLU
Partner/Financial Advisor – Love & Persson Group