Planning for your retirement: An easy list to keep everything in check

When planning for your retirement in the next 10 to 20 years, Rhonda Sherwood, wealth advisor at ScotiaMcLeod in Vancouver, first suggests taking some time to look at what guaranteed pension income or other income you will have coming in at your desired retirement age versus what expenses you estimate to be going out.

The shortfall (if any) will help determine how much you need to be saving and how to be investing. Rule of thumb - you want those essential or overhead costs to be covered by guaranteed incoming income. As such, if you have a shortfall in your income versus expenses at your retirement age, you might look to an annuity to fill the income need. However, before doing anything, seek the advice of a financial advisor to assess your unique needs.

[More: Why you should contribute to your RRSP this year]

You can request an updated pension statement from Revenue Canada for your Canadian Pension Plan (CPP). If you take your CPP early, you will be subject to a penalty. You can also request a pension statement from your company if you have a pension plan. Again there may be penalties for early retirement. There have been recent changes to the Old Age Security (OAS) pension that will most likely affect people ages 54 and younger, basically not qualifying for the pension until age 67.

[More: Got a retirement question? Experts respond to your pressing money dilemmas]

Are there any other income sources you will have? Sherwood suggests filling in this simple form to help you see and plan things more clearly:

Income at retirement

CPP _________

OAS _________

Other Pensions _________

Other income _________

[More: Retirement rationalizations: 6 misconceptions about RRSPs]

Expenses estimated at retirement

Household (taxes, maintenance fees, insurance, utilities) _________

Food _______

Hygiene and Personal ________

Medical/Dental ________

Transportation (payments, insurance, gas, maintenance, buses/ferries) ___________

Lifestyle (entertaining, travel, hobbies, gifts) ___________

Now, what is the shortfall, if any?

GoldenGirlFinance.com is a free personal finance and education site for women.

Nothing contained herein is intended to provide personalized financial, legal or tax advice. Before implementing any financial strategy, you should obtain information and advice from your financial, legal and/or tax advisers who are fully aware of your individual circumstances.

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