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How to Save Enough for Retirement | Sarah Twomey


How to Save Enough for Retirement | Sarah Twomey.

Sarah Twomey

Writer, Desjardins Group

Posted: 02/19/2014 12:34 pm

 Are you saving enough for retirement?

Over the years that Desjardins Group conducted its retirement survey, two themes always came up: most Canadians avoid retirement planning and they’re sure they haven’t saved enough. So, how prepared are you?

A) You’re totally confident about your financial security and retirement plans, or;
B) You know you haven’t saved enough, but now you’re ready to make a plan.
If you answered B, the experts from Desjardins have some suggestions to help you get started:

1) Think about what your retirement will look like: Will you be spending your retirement travelling the world or will you just keep on working? According to the results in previous retirement surveys, more than half of respondents expected to do just that. Many said it was because working kept them active. But the most popular reason was financial. While it might be nice to think that you could continue your current working lifestyle well into your 80s. But life has a way of throwing you curveballs. The reality is that less than one retiree in five continues to work. In fact, events like job loss, a disability, becoming caregiver to a loved one, or simply fatigue can change your plans in an instant. This is why it’s important to visualize what your life might look as part of creating a solid plan.

2) Figure out how much money you’ll need to save: Keep in mind that you’ll likely need enough savings for a retirement that last 25 to 30 years. For example, the average 55-year-old woman who is a non-smoker will live to 86 while her male counterpart will live to 83. That being said, you will likely need a retirement income of about 70 per cent of your gross working income. Here’s a snapshot of the type of income sources you may have if you were retiring today:

1. An employer pension, if it was available to you
2. The Canadian Pension Plan
3. The Old Age Security Pension
4. Savings in an RRSP and/or TFSA
Since future retirees have no control over the amounts of the first three sources of income, creating a substantial nest-egg within your RRSP and other savings accounts will be an essential part of your written retirement plan.

3) Each year, review your plan: The golden rule to ensuring you have saved enough is to regularly review your objectives and adjust your plan as required, as circumstances can change quite often over 20 years. For example, there may be changes in the tax rules, new laws, interest rates and public pension plans that may affect your goals. But if you stay flexible, all this is manageable, giving you much better odds of attaining your retirement goals.



  1. My comment:
    “…Here’s a snapshot of the type of income sources you may have if you were retiring today:

    1. An employer pension, if it was available to you
    2. The Canadian Pension Plan
    3. The Old Age Security Pension
    4. Savings in an RRSP and/or TFSA …”

    The key word here is “MAY” since everyone of the products outlined here depend upon third party risk, an inherently unstable situation.

    RRSPs and TFSAs, for example, rely on stability of the fractional reserve banking system, where banks only hold a very small percentage of deposits, using the majority of them to create credit/loans for others. It is estimated that if only 4% of depositors were to withdraw their funds, the banking system would collapse (which is what almost happened in 2008).

    The CPP and OAS are Ponzi schemes reliant upon ever-increasning contributions or membership. Even employer pension plans are dependent upon the company meeting its obligations, including not raiding the plan for capital as often happens.

    Even relying on sale of your home risks a market collapse.

    All and any assumptions one makes about future income are dependent upon so many other people meeting their financial obligations. Such a complex system is prone to failure and only as strong as its weakest link.

    I am not surprised, however, that someone within the financial system would avoid highlighting such inherent risks within what is increasingly being seen as a corrupt and fraudulent system. There is no investment that does not contain immense risk.

  2. How to save enough for your old age and not be worried about the government stealing it?
    Live fast, spend every thing you’ve saved , die when you’ve spent it, and roll round your grave laughing while looking at the government weenies trying to make a buck from nothing.

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