Wealth Strategies: Retirement planning; hand-in-hand with longevity planning
Milestone Wealth Management Ltd. - Jul 19, 2016
The evidence is quite apparent that we as Canadians are living far longer than we used to, or, to be exact, 25 years longer on average than we were a century ago.
Retirement planning: Hand-in-hand with longevity planning
The evidence is quite apparent that we as Canadians are living far longer than we used to, or, to be exact, 25 years longer on average than we were a century ago. This has numerous implications for our retirement lifestyle and financial planning strategy, not to mention countless other aspects of life such as profession, education, travel, where to reside etc. The challenge then, is to plan for retirement without knowing exactly how long one’s life may be, given the ongoing advances in medicine.
Financial planning discussions will therefore need to encompass additional considerations such as geriatric care, transportation, education and part-time work just to name a few. These discussions will lead to detailed planning for continuing education and ongoing professional development over a longer span of time, making our retirement income last for the duration of our lives. In such planning, we must also take into account the increasing costs for treatment of health conditions and diseases experienced in older age, and managing financial and emotional aspects of aging parents and children. The whole concept of financial planning therefore starts to take on a different business model of sorts; one that will serve us well as we move forward, given the changing dynamic in which we find ourselves.
Canadians in general seem to be lagging behind in regards to addressing financial planning concerns; proprietary research from Sun Life Financial shows that 78% do not have a written financial plan, and fewer than half say they have the knowledge to procure one. This is a staggering statistic, given all of the financial planning parameters one needs to consider in order to successfully prepare for retirement, and the ongoing longevity issues which will only add to the list. A relationship with a trusted financial advisor then becomes pivotal, as Canadians will need to rely on them more than ever to help manage these complexities. One should aim to have a good, working relationship with their financial advisor, such that the advisor understands what “makes you tick” and therefore knows what is essentially important to you. Capturing the essence of what is truly important to an individual or couple is the foundation of a solid retirement and longevity plan. Once this is determined, all future planning challenges can be discussed and addressed, action plans can be initiated, reviewed, and adjusted as necessary, and future goals can be met.
With the increasing time horizon of retirement planning, these additional concerns can seem overwhelming, but a good advisor can help break this up into more realistic timeframes to help one stay on track when it comes to setting goals and taking continual steps towards achieving them. The task of additional longevity planning then becomes much less daunting, and allows you to truly enjoy your retirement, whatever that might mean to you.