4 Steps to Retirement Planning

Planning for retirement is the most important thing you must do in order to secure a comfortable financial future for your family. Planning for retirement is one of the major financial goals which need extreme financial commitment for most Canadians. Are you nearing 60? Then, you may want to start saving to lead a comfortable retired life. The unfortunate fact is that most people spend more time planning for vacations than planning their retirement. The truth is you need to start saving for retirement much earlier than that.

Here are some steps that you can take to plan your retirement.

  1. Your expenses
    It is not your income that will be the determining factor, but your expenses. How much you need to save for your retirement. Start tracking your fixed and variable expenses, several years before you expect to retire. By doing so, you will get a realistic picture of your cash flow. First thing is to consider the expenses that you can eliminate at the age of retirement such as the deposits in the retirement plans.
  2. Eliminate the debts.

Most Canadians tend to ignore their debt issues Instead of managing their debts. They devote time in investments which seldom offers            worthwhile returns. Instead, they should calculate all their debt obligations and make out some way to pay them off. If needed, seek                  debt help as there are various agencies who offer debt help. Continue paying off your debts until you even pay off your mortgage loan.              The more you pay off your debts while employed, the better you can utilize the savings from the retirement plans.

     3.  Save through your RRSP
A Registered Retirement Savings Plan is an account where you can save money for retirement. RRSP helps to reduce tax and therefore              encourages you to save more. You do not need to pay the tax on this amount until the money stays in the RRSP, but if you withdraw the            money, you are liable to pay tax on it. It is better to withdraw the money after retirement so that the total amount is not subject to any              kind of tax.

4.  Retirement housing planning
There is one housing option which is taken by many senior Canadians, that of a retirement home. Retirement homes are rental                           accommodations that are privately owned by seniors in Canada. These are designed for seniors who need minimum to moderate                      support for their daily living. Some independent retirement homes also include subsidized housing that offers rental assistance from                the federal government.

In short, accumulate the adequate amount of income to ensure a happy retired life.

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