Longevity risk
Living longer is positive, but it increases the number of years your assets may need to provide income. Planning only to average life expectancy may leave too little protection for a longer retirement.
Retirement Planning
Retirement Is Not a Date. It Is an Income Plan.
You have spent years earning an income and building assets. Retirement changes the question from “How much can I save?” to “How will my money support me when my paycheque stops?”
More Than a Savings Number
Will Your Income Last as Long as Your Retirement?
Many people approach retirement with accounts, investments and pension statements, but no clear plan for turning them into dependable income.
They may know the value of their RRSP but not:
- 01
How much they can safely withdraw
- 02
When they should begin CPP and OAS
- 03
Which account they should draw from first
- 04
How taxes may affect their retirement income
- 05
Whether inflation will reduce their purchasing power
- 06
How market declines could affect early retirement
- 07
How much they can afford to spend
- 08
What happens if one spouse dies
- 09
How health or care costs will be funded
- 10
What will remain for their family
A successful retirement is not measured only by the amount accumulated.
It is measured by whether your financial resources can support the life you want, adapt when circumstances change and provide confidence throughout retirement.
Your Retirement Paycheque
Several Income Sources. One Coordinated Strategy.
Your retirement income may come from several places, each with different tax, withdrawal and timing considerations.
Select an income source to explore the planning considerations.
Canada Pension PlanCPP provides monthly retirement income based primarily on your contribution and earnings history.
The standard starting age is 65, but CPP can generally begin as early as age 60 or be delayed until age 70.
Starting earlier produces a smaller monthly payment. Delaying CPP beyond 65 increases the monthly amount, up to age 70.
The right time to begin depends on factors such as:
- Your health and life expectancy
- Whether you are still working
- Your need for immediate income
- Other available retirement assets
- Your spouse or partner’s income
- Your tax position
- Your preference for guaranteed lifetime income
- Your estate and survivor considerations
There is no starting age that is automatically right for everyone.
Explore CPP TimingOld Age SecurityOAS is based primarily on age, Canadian residency history and eligibility requirements rather than employment contributions.
Eligible individuals can generally begin OAS at age 65 or delay it until age 70 for a higher monthly payment.
The timing decision may be influenced by:
- Current and expected taxable income
- OAS recovery-tax exposure
- Guaranteed Income Supplement eligibility
- Continued employment
- Other sources of income
- Health and longevity expectations
- Canadian residency history
CPP and OAS do not need to begin at the same time.
Workplace Pension PlansAn employer pension can provide an important foundation for retirement income.
Depending on the plan, decisions may include:
- When to begin the pension
- Whether early-retirement reductions apply
- Which survivor option to select
- Whether inflation protection is included
- How a bridge benefit works
- Whether funds should remain in the pension
- Whether a transfer or commuted-value option is available
- How the pension coordinates with CPP
Pension decisions can be difficult or impossible to reverse after they are made.
Personal Savings and InvestmentsThe role of each asset should be defined before withdrawals begin.
Personal retirement resources may include:
- RRSPs
- RRIFs
- TFSAs
- Locked-in retirement accounts
- Life income funds
- Non-registered investments
- Guaranteed investments
- Annuities
- Cash savings
- Rental or business income
- Corporate investments
Retirement Pressures
Retirement Can Last for Decades. Your Plan Must Adapt.
Inflation risk
Even modest inflation can significantly reduce purchasing power over 20 or 30 years. A retirement plan should consider how income and investments may respond as living costs rise.
Market risk
A major market decline shortly before or after retirement can be especially damaging when withdrawals are already being taken. This is sometimes called sequence-of-returns risk. A plan may use appropriate cash reserves, income sources and investment allocation to reduce the need to sell growth assets during an unfavourable period.
Withdrawal risk
Taking too much too soon can weaken later retirement security. Taking too little can also prevent retirees from enjoying the lifestyle they spent years building toward. The objective is a sustainable balance, not unnecessary restriction.
Health and care risk
Provincial healthcare does not cover every health, prescription, home-care or long-term-care expense. Retirement planning should consider how additional care could be funded without placing the entire burden on a spouse or adult children.
Tax risk
Poorly coordinated withdrawals may create unnecessary taxable income, affect income-tested benefits or leave a larger deferred-tax liability for later years. Tax rules will change over time, so the plan must be reviewed regularly.
Survivor risk
When one spouse dies, household expenses may not fall as quickly as household income. Government benefits, pensions and tax treatment may also change. A retirement plan should show how the surviving spouse or partner would be supported.
Our Retirement Planning Process
Turn Years of Savings Into a Practical Retirement Strategy
- 01
Define the retirement you want
We discuss when you hope to retire, how you want to live, where you expect to live and which goals matter most.
- 02
Estimate your retirement spending
We separate essential expenses from flexible lifestyle spending and account for taxes, inflation and major future costs.
- 03
Organize your income sources
We review available information about CPP, OAS, workplace pensions, registered accounts, non-registered investments, insurance and other income.
- 04
Identify the income gap
We compare expected income with projected spending to determine how much must come from personal assets.
- 05
Model different retirement decisions
Where appropriate, we compare the potential effects of:
- Retiring earlier or later
- Starting CPP at different ages
- Starting or delaying OAS
- Changing spending assumptions
- Making registered-account withdrawals
- Adjusting savings before retirement
- Selling or retaining a business
- Downsizing or retaining the family home
- 06
Create a withdrawal framework
We help establish which income sources may be used, when withdrawals may begin and how accounts can work together.
- 07
Review protection and estate considerations
We consider the financial effect of illness, long-term care needs, death and survivor income. Tax and legal matters should be coordinated with the appropriate professionals.
- 08
Review the plan regularly
Retirement planning continues after retirement begins. Spending, markets, tax rules, health and family responsibilities can change.
Retire With Greater Clarity
Know Where Your Retirement Income Will Come From
You have worked too long to enter retirement with a collection of accounts but no coordinated plan.
Let us help you understand your income sources, compare important timing decisions and build a retirement strategy around the life you want to live.
Clear retirement guidance based on your goals, resources and circumstances. No obligation.
Retirement Planning Areas We Serve
Looking for retirement planning guidance near you? Explore Centerpointe Financials support across Ottawa and neighbouring Eastern Ontario communities.
The information on this page is general and educational in nature. It is not intended as investment, tax, legal, pension or accounting advice.
CPP, OAS, GIS, pension, registered-account and retirement-income rules are subject to eligibility requirements, applicable legislation and change. Estimates are not guarantees of future income, investment returns, tax treatment or retirement sustainability.
Investment products involve risk. Values and income may fluctuate, and past performance does not guarantee future results.
Before making decisions about pensions, government benefits, registered-account withdrawals, retirement dates, estate arrangements or tax strategies, consult the appropriate licensed or registered financial professional and qualified tax or legal advisors.
Products and services are available only through appropriately licensed or registered individuals and entities and may vary by province, provider, jurisdiction and client eligibility.