Planning tips for a financially secure retirement

When people think about retirement planning, they tend to only focus on retirement savings and RRSPs. This is not surprising because it's hard to imagine what life might be like in 20 or 30 years. But there's more to retirement planning than just saving money. For example, some new retirees are caught off guard when they realize that they are no longer covered by their group insurance coverage. One way to avoid these types of surprises is by thinking about what your values and lifestyle may be at that stage of your life, then finding the financial tools that will help you make it happen.

Disability insurance
Typically, disability insurance is not required in retirement because your income is savings and/or pension-based. However, it may be useful for those people who decide to take partial retirement and work part-time.

Life insurance
Most retirees don't require basic life insurance because the children have grown, they are likely debt-free and have some savings. However, there are life insurance products that are ideal for estate and tax planning as protection for inheritance amounts.  

Converting group life insurance
New retirees may have the option of converting their group life insurance into permanent individual coverage. This option is usually available during the first 30 days following the end of employment, before the retiree turns 65. While this is an ideal solution because an insurability evaluation isn't necessary, the policy premiums may be expensive because they are based on the new retiree's age.

Health Insurance
Health and accident insurance becomes increasingly important during retirement. Some provinces have implemented public drug insurance plans, but then may include a large annual deductible or may only be available to low-income participants. By contrast, there are a wide variety of private supplemental health insurance providers. Since each policy offering is different, it's important to do your research.

Now more than ever, planning ahead will ensure that you have a happy and financially secure retirement. Also, some of these options may offer a beneficial tax treatment. Take the time to get the facts by speaking with your financial advisor.

Submitted By:
JR Moy
Financial Advisor – Love & Persson Group