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Retirement Planning for the "Rest of Us" | This web-site is designed to give Retirement Planning advice for those Canadians, half the population, who do not have an employer pension plan at retirement and will not have saved hundreds of thousands of dollars in their RRSP. Only about 40% of the labour force have an employer pension plan. Jobs with pension plan coverage usually come with benefits like health benefits, maternity benefits etc. By retirement about half of families have no employer pension plan to speak of and must rely on public plans (OAS, GIS & CPP) and a modest retirement savings, mostly RRSP (on average about $40,000). This web-site is designed for those who will retire without an employer pension plan or large RRSP. This web-site is about retirement planning for the "Rest of Us". ====================================== A word to younger Canadians (under age 50). You can save in an RRSP even if you are low income. In fact, an RRSP can be an excellent investment. You can borrow from your RRSP for the down payment on your house (good idea). All I am saying is when you turn 50. That you reassess whether you are one of the "Rest of Us". If you are then you should definitely cash out your RRSP before your turn 65; 60 if you are a widow(er). ====================================== The table below will help you decide if you're "One of Us" - the cut off values are somewhat arbitrary. They vary somewhat depending on your circumstances. This is just a guideline. Generally, if you don't expect to have more than roughly $100,000 in your RRSP at age 65 and don't have a good employer pension plan then you're with the "Rest of Us". If you are one of the "Rest of Us" then the general advice that is given by your bank or financial planner is the same as they give to the economic elite - the financial comfortable. For you it's worse than inappropriate - it's wrong. Following that inappropriate financial advice can do you serious financial harm. Your bank will tell you to maximize your RRSP savings - their tellers encourage EVERYONE to contribute to an RRSP. My research, over the last 5 years, has demonstrated that RRSPs are a terrible investment for "The Rest of Us". You can get more information and references for my work by following the link below. The table below will help you decide if you're one of the "Rest of Us". | ||||
Are you old enought that you should worry about the dark side of RRSPs? What Age Group are you in? |
Under age 50: Go ahead use RRSPs if you like; although paying down your mortgage is also useful.
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Age 50 or over: You should take stock and see if you will be one of the "Rest of Us"
at retirment.
| Proceed below... |
Employer Pensions (you and spouse combined) | Employer Pension is non-existent or minimal (say under $20,000) | Employer Pension benefits are adequate (say $20,000 plus) | |||||
| RRSP savings at age 65: limited: roughly under $100,000 |
You are one of the "Rest of us"
Taking financial advice from the 'professionals' could cost
you dearly. This web-site is design for you |
You've got a good employer pension... see your bank or financial planner for advice; but remember they are commissioned sales people sell RRSPs - not advice. | |||||||||
| RRSP savings at age 65: significant: over roughly $100,000 |
You were likely a self-employed professional or very good at savings... see your bank or financial planner for advice; but remember they are commissioned sales people sell RRSPs - not advice. | You've got a good employer pension and significant RRSP savings (good for you)... see your bank or financial planner for advice; but remember they are commissioned sales people sell RRSPs - not advice. | |||||||||