| For many Canadians, the key focus of their financial planning efforts is retirement. When it comes to retirement, we have observed two important things: First, many people today are retiring younger than the traditional age of 65.
Second, we're living longer. Keep in mind, retiring earlier and living longer have two clear implications; you'll have less time to build your retirement nest egg and when you do retire, that nest egg will have to provide you with an income for many years.
Determining how much you must save to retire, then, is a critical step towards a worry-free retirement. Generally speaking, you'll need a retirement income of somewhere between 70% to 100% of what you were earning prior to retirement. Things like your mortgage should be paid, and if you have children, they will, hopefully, not longer be dependent on you. Bottom line, retirement is about lifestyle. And the lifestyle to which you have become accustomed is directly related to what you earned before you retired. |