Q. Are there books or good self-help websites on retirement planning for Canadians that you can recommend? I live in Ontario and want to retire earlier than age 60 but I’m unsure how taxes will affect me when I can (and should) begin to draw down on my registered and non-registered savings. I’d also like to understand what I can do to maximize my after-tax retirement income. Any suggestions you have would be appreciated.
A. This is a great question. There are so many sites in the web universe for online help and resources that it’s important to confirm the background and credentials of the information you are looking at.
Before you even begin, always check and make sure you are looking at Canadian sites because sometimes U.S. and U.K. sites have similar-sounding products and advice, but they work within a different regulatory framework in those countries. So those sites aren’t as helpful to you.
I would start with Canadian federal or provincial government websites that are unbiased and well researched. I like Financial Consumer Agency of Canada and, in Ontario, Get Smarter About Money. Both of these sites have useful information about various financial products and strategies, as well as financial calculators to help you evaluate how beneficial some of this advice is in your particular situation. Note that other provinces have similar websites.
I also think books are a great way to really get into a topic. I would recommend three. First, Retirement Income for Life: Getting More Without Saving More by actuary and writer Fred Vettese. This book runs the numbers for a comfortable retirement and shows you how you can best control your income flows from the Canada Pension Plan (CPP), Old Age Security (OAS), Registered Retirement Savings Plans (RRSPs), Registered Retirement Income Funds (RRIFs), annuities and other pensions—all with the aim of showing you how you can have a very comfortable retirement at almost any annual retirement income level—even a very modest one.
Victory Lap Retirement, by Mike Drak, Certified Financial Planner Rob Morrison and MoneySense columnist Jonathan Chevreau, highlights how we are living longer than ever and offers a few solutions to make any retirement work—including the benefits of working a few years longer or simply finding a passion and job you love for a few hours a week to provide some income while you’re retired. And finally, The Procrastinator’s Guide to Retirement, written by David Trahair and produced by CPA Canada. It shows you a game plan for retiring in 10 years or less by doing simple things like tracking your retirement spending, budgeting effectively, maxing out your savings, reducing debt and investing better. These should all be available at your local library, as well.
There are also several media outlets, such as MoneySense, that have great information and more direct discussions about specific retirement topics. When evaluating these sources, check that the writer is experienced, and the outlet is reputable.
That said, nothing beats the one-on-one approach of working with a personal financial planner or advisor. It’s always helpful to increase your own financial literacy, but also helpful to speak to an expert. To ensure you get transparent and unbiased advice, look for a fee-for-advice planner or someone who sells no products. Sometimes your workplace’s employee assistance program (EAP) or group RRSP provider may have some resources to suggest. Check with your company’s human resources department to learn what’s available to you.
Rob, it’s a good use of your time to increase your financial literacy. The results will be well worth it.
Janet Gray is a fee-only, advice-only Certified Financial Planner (CFP) at Money Coaches Canada, based in Ottawa. She sells no financial products.
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