A checklist will help the process
Retirement planning can be daunting, but it doesn't have to be.
Cindy David, who is one of the top estate planners in the country, suggests a comprehensive range of services that include financial planning, tax, and investment-advisory services to prepare your retirement plan.
David, who incorporated under Cindy David Financial Group Ltd and representing Raymond James Financial Planning Ltd., offers five steps to make the process as straightforward as possible:
5 ways to plan for retirement
David suggests clients have a written document that is a guide for their future and changes as your family’s needs evolve. Most crucial are the years approaching retirement. Once you have that document established, review it annually to make sure you’re on track. Once you’ve reached retirement, it can be updated every two to three years, depending on economic and family fluctuations. Although any time there is a major life change—such as downsizing, inheritance, a market correction, major purchases, large gifts to children or charities—it’s wise to do an interim check.
When clients transition from paycheque to retirement they can be at a loss to understand: “Where is the money going to come from?” This can be frightening and daunting for new retirees. David can ease retirees’ worries by mapping out a complete financial picture. For example, prior to the RRIF age of 71, you might want to take advantage of your RRSP early withdrawal if you have a year where you are in a middle- to lower-tax bracket. This requires a conversation every year to determine any other competing factors.
David spends a lot of time figuring out not only how to minimize tax on current annual spending, but how to work out a strategy to reduce clients’ overall estate tax so there is less need for unnecessary insurance. Insurance has its place, but nobody likes paying for something they’re never going to benefit from during their lifetime—so determining efficiency is a priority. Don’t assume that insurance is too expensive; quite often that is a misconception. It’s important to research the specific costs for a plan that makes sense for you, and then decide how important it is to put it in place. For those clients who have fixed real-estate assets or business assets that might be difficult or take time to sell, insurance can provide immediate liquidity to eliminate the need to sell off an important family asset.
Many clients, for different reasons, come to David with limited investment experience. She firmly believes that people should work with someone who specializes solely in investments. As a result, she partners with top investment advisors to provide the best advice and financial plans. The biggest risk to your financial portfolio is to choose an advisor based on personality rather than on their education and experience.
Taxes and Legal considerations
Often professionals work in silos. Creating a dream team is more important than ever. Sharing expertise among professionals in order to work together is the key to your financial freedom.