Planning for Retirement: Age-appropriate Advice

by Mary Ann Marriott, CIRP, LIT and Maureen Babin, Financial Advisor, Amarack Financial
November 27, 2023

When it comes to planning for retirement, there are two very different groups of people. The first group consists of those who start planning early and the second group consists of those who had a late start - for many reasons - and now want to maximize the time they have left. And the strategies can be very different for the two.

Let me start by saying that I am not an investment expert. So, my first stop was a visit to my friend and financial advisor, Maureen Babin (Amarack Financial), to ask her how she would deal with both of these groups.

I first asked her “What does retirement planning mean to you?”

Her response, “Planning for retirement, to me, means being responsible for your own future.”

I couldn’t agree more. It’s easy to fall into the trap of thinking someone else will take care of you (we are coming back to that point in a moment) and leave your future to chance. And that is a huge no-no. You are the only one who can prepare for your future and protect your interests.

 So, what does ‘taking responsibility’ look like?

  • Be informed – at the very least, meet with a financial planner or use an online calculation tool to determine what you think you might need for retirement based on your age and estimated retirement years. Personally, I like talking to someone knowledgeable in the industry. They can engage you in meaningful conversation that addresses your particular circumstances and concerns.
  • Do something – the old adage that something is better than nothing holds true here. Sometimes we get discouraged thinking that what we can do is not going to be enough. But once you start to put some money away, something magical happens, you gain momentum. Seeing your account grow over time encourages you to keep going and to add more to the ‘retirement pot.’
  • Make it a priority – this is true at any age. When we are young(er) we tend to spend money on wants more than needs. Retirement planning is a need. Trust me. I see this every day in my profession. Living on our standard government pension (CPP & OAS) is not an option. You barely survive on that amount, let alone live comfortably on it.

My second question to Maureen was “What are the most common mistakes you see people making when it comes to retirement planning?”

Her response (and in keeping with the message above), “Thinking the government will take care of you is a huge mistake that I hear all the time.”

That is not their job! Let me repeat that…it is not the government’s job to look after you in retirement. It never was, and it never will be. It is your responsibility. The pension system was meant to provide a basic amount of money to those with no other means of saving for retirement, not to provide you with enough that you can live on comfortably. I think this point is extremely important and one that everyone needs to hear repeated – young or old. It is a common misconception that I also hear daily.

So, Maureen, I asked. “What advice would you give to someone starting out in their younger years?” and my very wise friend said “Start with a small amount and increase it as you see fit.  Remember this is how you eat a bite at a time.”

I love that she used the whale analogy. Because I think I am safe in saying that we have all heard that expression. And it is completely relevant to any long-term goal. And it circles back to my tip above – take responsibility. Start with ANYTHING you can and then figure out how to add to it as you go along.

Well, Maureen, I asked, digging deeper, “What about someone getting closer to retirement and getting a bit panicky that they have not done enough?”

Her sage advice was to consider other options and takes us beyond just saving and looking at other alternatives, such as:

  1. Selling a property
  2. Mortgaging a property
  3. Starting a part-time job (or side business/hustle)
  4. Delaying retirement

Sadly, number 4 (delaying retirement) is a reality for many. The retirement age seems to be pushed out further and further. Having said that, many of those at the retirement stage of their lives are ok delaying retirement or getting a part-time job as they want to continue to work not only for the money but for the social aspect as well.

And at the time of writing this post, when I look at the housing market, this is a great time to sell and/or refinance (numbers 1 & 2) and I am seeing many people doing just that and taking advantage of the current market to help them fund their retirement nest egg or make that leap into retirement.

At the end of the day, the important thing is that you meet yourself where you are. If you haven’t started thinking about it, start thinking about it. If you have started thinking about it, but haven’t taken action, take action. If you’ve taken action but are unsure if it is enough, get clarity. If you have clarity and are on the retirement planning path, keep going and review your plan regularly to ensure it still reflects your lifestyle, retirement goals, the current economic situation and has a little buffer built in for the unknown.

As my friend Maureen says, “People don’t plan to fail, they fail to plan.” Review your retirement plan today. You will thank yourself in the future!

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