How much is enough? Books have been written on the subject of retirement and what you need to save. Myths abound on this question. Here’s one to consider: I need $500K, $1M, $2M to retire.
Retirement myth #3: I need $500,000, $1 Million, $2 Million to retire.
The fact is that your “number” can vary greatly depending on your personal situation and goals, how long you expect to live, whether you will be single or with a spouse/partner and when you will retire. Check if an advisor who specializes in retirement planning or better yet, retirement income planning, offers tools or help to estimate how much you need to save.
You may try some of the tools available from trusted sites produced by large financial institutions. The Retirement and Savings Tool from Empire Life can also help you determine how much income you will need to retire. It's simple, fast and easy to use and you can share the results with an advisor to get the conversation started. And don’t forget government benefits like the Canada or Quebec Pension Plan (CPP/QPP) and Old Age Security.
If you want to maintain the same lifestyle before and after retirement, your number is tied to how much income you will need to provide the same consumption dollars. That’s the money you normally spend on your own lifestyle. Add some extras for that bucket list of yours for those early years of retirement when you will be most active and will no doubt spend more money.
© 2020 by Peter a Wouters. Updated and republished with permission by Peter Wouters. For the complete list of articles, please visit here.
Related articles:
Ten retirement myths series: Myth #10
Ten retirement myths series: Myth #9
Ten retirement myths series: Myth #8
Ten retirement myths series: Myth #7
Ten retirement myths series: Myth #6
Ten retirement myths series: Myth #5
Ten retirement myths series: Myth #4
Ten retirement myths series: Myth #2
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February 2020
