Are you spooked yet?
Today scary decorations are all around our neighbourhood. Halloween, the day of dressing up and trick-or-treating, is full of fun and excitement for the young. But there are often 365 days of fears for retirees.
What scares retirees the most?
- The Market
When you are young you and the market has a major set back you are told not to worry … the market always rebounds. And while that has proven true, for seniors, they often don’t have the time to wait for a rebound, as they depend on their savings for income. Its pretty scary when your account is off by 20% and you still have to sell assets to provide for an income.
- Interest Rates
Traditional financial planning guidelines will advocate to having a serious proportion of one’s money in guaranteed investments in retirement. The reason often being point number two above. But having a significant amount of your nest egg invested in fixed income earning 1% can be pretty scary.
- Taxation Rates
Speak to any retiree who has started to collect money from a pension or RSP/RRIF and they will always complain about the taxes they pay. They feel they were sold a bill of goods with the promise that they’d be in a lower tax bracket in retirement. With inflation, the general increase in cost of goods, and there fore higher income needs, tax bracket creep has gotten pretty creepy. I for one do not believe the government will need to tax us less in the future … not with all the debt they are issuing these days.
- Health
The cost of drugs and healthcare needs in the future can wipe out a lifetime of savings in no time at all.
Are you spooked yet?
There is a solution. And it’s a better built plan. Contact me today to discuss how your financial plan can build safeguards for the costs of the scariest risks in retirement.
