How Much Money Should You Be Saving For Retirement?

How much money do you need to retire comfortably? The answer is different for everyone. To arrive at that answer, it pays to think through some questions first.

Below is a list of questions to consider. Whatever your answers, I advise meeting with a financial planning professional to plan for your best retirement possible.

 

Do You Want To Maintain The Same Lifestyle?

Some folks are happy to cut back in retirement. Plenty of people downsize their homes, drive affordable vehicles, and go camping on vacation instead of jet setting to Tuscany. But if you’re used to a certain lifestyle and want to maintain it, you’ll likely have to start saving early as a retired person who’s no longer earning an income.

It’s understandable when people don’t want to part with the lifestyle to which they’re accustomed, but it takes planning to ensure your retirement is prosperous.

 

Do You Have Enough To Last For Your Whole Retirement?

In 1960, the average Canadian lived to be 71. Now, that number is 81, with more people hitting triple digits. With new medical advancements arriving all the time, who knows how you might live?

Longevity is a privilege, but it comes with its own challenges. Outliving one’s retirement savings is a serious concern. To protect yourself, make sure your savings goals factor in the possibility of leading a longer than average life.

 

How Generous Would You Like To Be?

There’s no law that says you have to help your kids put a down payment on their first home or donate to your preferred charity. However, if you’re inclined to give generous gifts, budget for this.

A question I ask my clients is this: “Would you delay retirement for an extra year if it meant you could pay for your kids’ education?” The same tradeoff can be applied to a host of goals. Perhaps you’d be willing to postpone retirement if that meant you could invest in a cottage for your family or cars for your grandchildren. Giving to others is a laudable impulse, but you’ll have to plan for it.

Photo by Monica Silvestre from Pexels

Brandon Lee

Brandon Lee is a wealth management consultant at IG Wealth Management. A graduate of Queen’s University’s economics program, Brandon has devoted his career to empowering clients to live their best financial lives. He lives in Toronto with his wife and daughter. To schedule a financial checkup with Brandon, reach out via email at brandon.lee@ig.ca .

Latest posts by Brandon Lee (see all)

Leave a Reply