Are you ready to retire? We’ve compiled some items you should think about and review with your advisor one to two years before you officially retire.
Know where you stand
Meet with your advisor one year before retirement. Bring statements for all of your assets (and your debt) in order to create a comprehensive retirement plan. Don’t forget your insurance policies!
In the perfect situation you would bring your budget, having tracked your expenses down to the dollar for an entire year. This way you won’t be guessing how much you spend – you’ll have a true reflection of your annual expenses. Dynamic Funds crafted a Retiring Budget worksheet that allows you to compare your current expenses with your expected retirement expenses.
Watermark Wealth ManagementAre you ready to retire in 1 to 2 years?
Pull out one of your investment statements. Do you hold only Canadian investments? If so, you may be suffering from Home Country Bias. While picking investments can cause paralysis by analysis, taking a global approach and tracking multiple asset groups can help both preserve and grow your money.
The world can be a demanding place with countless decisions that need to be made on a daily basis. Most of us don’t have free time to spend sitting in front of computers looking at bar charts, pouring over historical market research and deciphering economic reports. Putting together the perfect investment account can be difficult given the endless investment choices available in the marketplace. It’s enough to make one suffer from paralysis by analysis.
What is Home Country Bias?
In order to simplify the situation some of us decide to own only companies we know well, companies headquartered in the country in which we live. This is called Home Country Bias. However, cheering for the home team in your RRSP may not be your best bet.
Our friends at Franklin Templeton have created a video that walks you through why backing your country in your investment account, might not be your best bet.
Saving for retirement is not easy. Dealing with day-to-day expenses can prevent people from looking at their long-term finances. Especially when they are young and haven’t yet seen retirement peak over the horizon. The Ontario Securities Commission (OSC) released a study in November of 2018 that found that 34% of men and 43% of women aged 18-34 haven’t started saving for retirement.1
The OSC found a scarier statistic in those aged 55+. 8% of men, and 18% of women aged 55+ hadn’t started saving for retirement.1 At this point there’s simply not enough time left to properly prepare, make informed decisions, and know that you’ve chosen the right path. Those in this situation will find themselves either accepting a retirement that is less than they dreamed, or they will work longer than expected and experience fewer years in retirement living.
But what if we told you that there was a way in which you could ‘retire’ early? And no – we don’t mean at 55!
You may not be entirely familiar with this idea, but there are actually two different phases of retirement – and one of them can start as early as you would like!
Watermark Wealth ManagementThe Two Phases of Retirement
Ok, be honest. Were you one of those people scrambling for savings in order to meet the RRSP deadline?
Are your RRSP savings habits like a bad thriller movie? You move funds from this account to that, trying to come up with that bold number haunting you from the bottom of your Notice of Assessment – RRSP deduction limit.
You say to yourself, if I just move this here, and move that there, then it will all be in my bank account by Feb 28th. Then I have to make a bill payment to HollisWealth, gosh, they’ve changed their name so many times, where was that payee name that they sent me? Oh, I’ll just email the Watermark team, they’ll know. Why have they not responded to my email? It’s been 5 minutes already!!! Okay, I heard back.
Now I just have to put the kids to bed and unload the dishwasher and then I can do the bill payment to my RRSP. Except I forgot and went to bed without doing it! Now it’s March 1st and oh gosh, hopefully if I do it today it will still count…
Sound familiar? Maybe it’s time you take the drama out of your RRSP contribution.
Watermark Wealth ManagementPut your savings on repeat
The investment industry likes to talk about risk in terms of holdings in your investment account.
They talk about whether you have enough country diversification and diversification of types of investments, whether your time horizon is long enough for your risk level, and whether your investments will keep up with inflation. While these factors are important to creating an effective portfolio, keeping your emotions under control is equally as important.
The investment gurus here at Watermark Wealth Management, Chuck Magyar and David Lyon, recently attended the 13th annual iA Securities Year Ahead Investment Conference in Toronto. By showcasing the differing viewpoints of more than 20 industry experts it provided us with a better sense of what we should be expecting from financial markets in 2019.
We heard from an impressive group of individuals including iA Financial Group’s Chief Economist, Clément Gignac and Brian Belski, who is the Chief Investment Strategist at BMO Capital Markets. A number of prominent money managers lent their thoughts as well, including Peter Norman, one of Canada’s leading experts on the residential housing market.
Here are some of David & Chuck’s key takeaways of the day:
Watermark Wealth ManagementWhat does 2019 have in store for us?
Supporting those that need a little extra help – follow up from our day in December…
Back on December 19th, before the Christmas break, the team at Watermark Wealth Management, once again teamed up with the amazing folks at Dixon Hall Neighbourhood Services to deliver meals to those that need some additional help. Kate, Chuck, David, and I participated in our third Meals and Wheels program, delivering meals to individual’s homes in the downtown Toronto area.
Watermark Wealth ManagementMeals on Wheels with Dixon Hall
While it may be really hard to rid yourself of all the stress associated with the holiday season, we do feel that it is possible to reduce the stress that seems to start building as soon as Halloween is over and we start hearing holiday music played in malls and on radio stations! We have a few suggestions that may help:
Watermark Wealth ManagementCan you have a stress free December?
How will your life’s wealth story be told? A financial autobiography ensures that in life, in death, in life beyond death, you have a plan for your wealth so that your money lives longer than you. Here are 6 steps to create a plan that will allow your money to live on for generations.
1. Let your beneficiaries know that they’ll be receiving an inheritance.
Create an information package and share it with your loved ones. By having conversations years before there’s a critical need, you’ll ensure a smoother transition of your wealth to your heirs. What should you discuss? There is no right or wrong answer here. Topics will vary from family to family, including wills, location of important documents, even advance care planning and funeral and burial preferences.
Watermark Wealth ManagementHave you written your financial autobiography?
Freedom is often a word associated with the self-employed, but being your own boss requires a lot of organization around your savings and retirement.
Small businesses account for 71% of the total labour force in Canada.1 That’s a lot of people who are experiencing the new normal workforce – no pension plan, no group RRSP, and no employer helping you manage your obligations back to CRA. As independent business owners, we live these issues every day. We can help you manage fluctuations in your income so you can sustain your lifestyle while also saving for retirement.
Watermark Wealth ManagementManaging savings when you are self-employed