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What Retirees Wish They Knew Sooner about Personal Finance Planning

Personal Finance Planning

Ultimately, every decision you make about money adds up to create your financial situation. Every charge on your high-interest credit card and decision about saving and investing builds your future. Even if you don’t necessarily consider it personal finance planning. Create a plan to help you stay on track to achieve your goals.

Not every financial decision you make in your lifetime is likely to be a good one. Still, most retired Canadians largely live the retirement of their dreams. So you can do the same, retirees are sharing some advice for their younger selves and you.

Start Saving as Early as Possible

The number one piece of important advice retirees have for their younger selves is to start saving earlier. Some describe specific stress in the last few years before retirement as they raced to achieve the balance of their long-term goals quickly. Most describe their lives in their 20s, 30s, and 40s. Suggesting there was probably more that they could have done to top up their savings account back then.

For example, contribute the maximum if your employer has a matching retirement program! The long-term goals for your savings pale in comparison to the immediate returns you get from your employer’s matching funds. In many cases, your employer could match 3 to 5% of your salary before taxes. So, if you make $60,000 a year, your employer could donate up to $3,000 annually for your retirement.

Use this general rule of thumb, by the time you turn 40, you should have about twice your annual income in retirement savings. If you don’t (yet), now is the time to start contributing more to your retirement funds!

Money is Important – But It Isn’t Everything

The next most common thing retirees wish they knew sooner about personal finance planning is setting priorities. While it’s important, even vital, to plan for retirement, many retirees wish they had stressed less about money over the years.

So much time is spent working hard, only to ultimately end up with a pension and reasonable savings. Yet, it’s impossible to get back the joy of spending a few hours with the kids at the park.

You know how some days or weeks just seem to drag on? Well, the years fly by! So, focus on things that don’t cost money, like your relationships, health, and doing things you enjoy.

Personal finance planning can lead to a preoccupation about the future. Especially, when it comes to saving for retirement, If you focus too much on the future though, it’s easier to forget about truly living life in the present.

Steer Clear of Things That Depreciate in Value

Some depreciating assets are necessary. Most families need a vehicle, and it’s hard to live without some furniture. Sometimes, the short-term reality of your financial situation can undermine your long-term goals.

Think carefully about your expenditures that will be worth less next year. Could your phone or computer do for another year? What can you buy used? How many game consoles do you really need? Anything that depreciates does not add to your long-term financial situation.

Learning About Personal Finance Planning is Worth Your Time

Perhaps your parents sat with you at the kitchen table when you were a kid and explained personal finance planning. If so, planning for retirement will be easier for you than for most. if that’s not the case for you, it is worth your time now to learn about:

  • Compound interest
  • Estate planning
  • Cash flow
  • Budgeting
  • Your credit score
  • Life insurance
  • Setting up an emergency fund
  • Saving and investing
  • Interest rates
  • Creating a financial plan

With some basic information in these areas, you can make informed decisions so you can achieve your goals.

Put Together a Thorough Financial Plan

Most people wait until they are close to retirement before putting together a thorough financial plan. By creating a plan as early in your career as possible, you will have less guesswork to become financially secure.

Outline your retirement wants and needs and make a plan for how to get there. Consider your risk tolerance, at what age you want to retire, and the lifestyle you want. Then, calculate how much to save based on the income you expect from investments, your RRSP, CPP, and other income. You can always adjust your plans.

Don’t forget to Include Investing for Health Care in Retirement

Make sure you put aside a fund to cover medical expenses as you age. Although the provincial and federal government coverages shift and change, prepare to pay for:

  • Prescription drugs
  • Dental services
  • Eyeglasses, contact lenses
  • Laser eye surgery
  • Cosmetic surgery
  • Hearing Aids

Don’t forget to Include Fun in Retirement

Once you’re retired, you have time to do some of the things you always wanted. Don’t limit yourself by making the budget unliveable. Add enough for travel, hobbies, and whatever else is on your bucket list.

Get Professional Advice

Retirees who worked with financial planners enjoy some worthwhile perks. They tend to consider themselves better prepared to retire with less financial stress. Almost all said the professional advice well outweighed any cost.

Many found they could be more aggressive with investments, budget to spend less, save more and develop a solid retirement plan. Most likely, their investments did better than they would otherwise. Most importantly, they felt confident over the years that they did the right things with their financial planning.


No matter where you are on the path to retirement, these valuable insights can help you move ahead with financial confidence. Educate yourself on topics like credit card management, investing, compound interest, employee benefits, and interest rates.

Start by evaluating your current financial situation. Assess your knowledge level and spending behaviours honestly. You need to know where you are to be able to make a plan to get where you want to go. Look at your numbers carefully. They may prompt actions that have the potential to completely transform your financial future.

When you look at your current situation, you may find you need help to get control of your debt. If so, talk to a trained Credit Counsellor for a free assessment. We’ll help you find the right solution.

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