It might be worth it to pay for advice. But advice only. Not tied to any products. I think fiduciary has different meanings in the U.S and Canada.
Retire
- Thread starter Downtime
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Very true also. Once you pay get the receipt so you can use as a financial deduction.
LTO_3
Things can get tricky. Here is an example.
edrempel.com
National Post article: Could an RRSP/RRIF meltdown reduce Liam’s GIS clawback without triggering a big tax bill?
Liam thinks he is in a 19% tax bracket. He isn’t. He is effectively in a 50% tax bracket because he pays 0% income tax, but loses 50% of additional taxable income through the GIS clawback. His situation is interesting because: In my latest article for the National Post, I look at why withdrawing...
edrempel.com
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Good God, people aren't paying enough attention to inflation.
Retire at 62, live 25 years, inflation is now around 3% per year, that amounts to an increase of cost over more than DOUBLE over that time period.
Any plan needs assets that at least keep up with inflation.. The nasty thing is that if, say, inflation goes to 5% for a few years, then interest rates will go up too, and that will quite likely put downward pressure on the valuations of stocks. Sure, dividends will likely keep coming, but heaven help you if you are FORCED to sell stocks at that time to pay for living expenses.
Retire at 62, live 25 years, inflation is now around 3% per year, that amounts to an increase of cost over more than DOUBLE over that time period.
Any plan needs assets that at least keep up with inflation.. The nasty thing is that if, say, inflation goes to 5% for a few years, then interest rates will go up too, and that will quite likely put downward pressure on the valuations of stocks. Sure, dividends will likely keep coming, but heaven help you if you are FORCED to sell stocks at that time to pay for living expenses.
Unfortunately fee only advice is NOT tax deductible. In order for it to be tax deductible, the advisor will need to advise on specific security or manage your portfolio.
my advice would be for OP to model out his situation using available software like adviice. Only $10/month.
I think an important question to ask is, do you have a DB pension that's fully vested? Because if you are one of the lucky few that still have that AND $800K, you're laughing. Most DB pensions have a Cost of Living Adjustment (or COLA). If you have that, you can help offset inflation. The reality is, at 62, you could theoretically live for 30+ years, and at the least, 15 - 20. Most inflation and taxes will take a bite out of your nest egg, and then there is the whole thing if you need care as you get older. That shit is expensive. Then of course there is the risk of a major stock market correction or financial crisis. Not sure if you've been looking at the bond market, but borrow rates are going really high, which will hurt the overall economy. And, there is always a chance that Donnie Dumb Dumb might put the US into default at some point.
I am not an expert on this by any measure. I do know a little about a lot, but its very narrow. Just be careful. You would hate to have to work at Walmart of something like that in a decade because you ran out of money.
I am not an expert on this by any measure. I do know a little about a lot, but its very narrow. Just be careful. You would hate to have to work at Walmart of something like that in a decade because you ran out of money.
Pretty much all public sector DBs have indexing(COLA) or at least partial indexing at it's worst. Plenty of private sector DBs not indexed although the ones with the big unions usually are.
My company phased out DBs for new workers around 2000. Then about 8 years later they made the remaining DBs change to either a DC or a hybrid pension.
Women are more likely to have indexed DBs as a lot of them work for government or broader public sector workers in fields like health care, and education, and the private sector has gotten worse and worse over the last 45 or so years.
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This is a very good point. Inflation is killer and will eventually lead to him selling his house.
So what is your suggestion? Work until we die? People focus on lifespan, but there is something called healthspan that is equally important. Newsflash…in Canada it is ~67. In OP’s case, he has 5 good years left before health issues creep in affecting his life. You can adjust spending, but you cannot fight Father Time.
The point I was making is the first sentence in the final paragraph.
Pay attention to inflation.
The topic is whether or not he has enough to retire. One possible reason why he may not have enough to retire is due to inflation eating into savings. There are many other reasons why he could possibly not have enough.
I believe the solution was pretty strongly implied in my post; have some exposure to assets that are to at least some degree linked toinflation.
Other solutions like work until you die are actually not relevant, considering the post is about retiring.
But to state it plainly, if one runs out of sufficient funds in retirement, then the suggestion would be obvious - reduce spending, or increase income, either through a better investment choice, or by earning income.
I doubt that many people are going to reduce their wish to enjoy their lives merely because statistically they reach an age where health issues begin to creep in. I am not that far off and I have no wish to reduce my living expectations. In fact, I am enjoying life more than ever!
There are many well-known Insurance companies that are available: Manulife, Canada Life, Beneva (started with 2 Quebec companies that amalgamated; SSQ and La Capital) and Sunlife to name just 4. I've had dealings with the first 3 but slowly working that down to two to have better control & oversite. It's a matter of researching and seeing if they carry the same ETF/mutual funds or something comparable, etc and fortunately I have some assistance with this.
LTO_3
