Planning to Retire in 10, 20, or 30 Years? Then Read This.


When you imagine your ”golden years,” do they feel light years away… or is retirement beginning to sneak up on you? Whatever the case, it’s never too late to adjust your spending (and saving) habits in order to retire comfortably.

And while too many Canadians still aren’t saving enough money for their later years, you can choose to not be one of the 88% who are unprepared (source). That’s right, only 12% of Canadians have a plan that details their lifestyle goals and income needs for retirement.

So let’s start planning and join the 12%, shall we?

If you’re 30 years from retirement…

If you’ve got three decades (or more) to plan and save for your golden years, then you’re golden. #punintended Now is a great time to slowly but surely start putting money away for the future. The good news is, you’ve got lots of options – especially with so much time on your side. Consider putting a small percentage of each paycheque – even if it’s only $100 a month – into a RRSP, a TFSA… or both! You’ll be surprised at how quickly it will multiply into something significant.

Hot tip! If your employer offers a group-sponsored plan (e.g., pension, RRSP, etc.), consider opting in, especially if they are matching your contribution – since it is essentially free money.

More ways to build your savings over the next 30 years:

  • Set up automatic payments to slowly pay off debts.
  • Depending on your tolerance for risk, you may want to consider higher risk investments as they may result in higher returns over the long run – but always speak to an expert before investing your hard-earned money!
  • Purchase life insurance while you’re still young and healthy – because the cash value that accumulates in a whole life insurance plan may be there when you need it most.

If you’re 20 years from retirement…

At this stage, it’s important to think about what life after retirement looks like to you – and how much it will cost for you to get there. If you’ve been putting the minimum towards your retirement savings, it may be time to start putting more money into your savings based on what you’ve calculated you’ll need to live comfortably. Speak with a Serenia Life advisor to make sure you’re investing wisely, and to make sure you’ll generate the most after-tax return from any investment option you choose.

Hot tip! Set up a family meeting to speak with your parents about estate planning, wills, and life insurance – funerals can cost up to $20,000, so you’ll want to be prepared (source).

More ways to build your savings over the next 20 years:

  • Use bonuses and extra income to pay off debt faster.
  • Depending on your tolerance for risk, you may want to begin transitioning away from higher risk investments with the ”insurance version” of a GIC, for example.
  • Put some money aside each month for the fun stuff. Plan ahead for big-ticket items, like a dream vacation or second property – but be sure to stick to your budget and avoid ”midlife crisis” splurging.

If you’re 10 years from retirement…

Now’s the time to really focus on saving. Generally, when you’re 10 years away from the big ‘R,’ you should be increasing your savings rate as much as possible – while doing everything you can to eliminate any remaining debt. With wise planning, it’s possible that as much as 80% of your retirement savings will be set aside during this time. One way to do this is to make additional catch-up contributions to your RRSPs.

Hot tip! Have a lump sum of money to invest? Consider investing in a Single Premium Annuity where you can receive a regular ”paycheque” through a guaranteed income stream once you’ve retired.

More ways to build your savings over the next 10 years:

  • Pay off all outstanding debts.
  • Depending on your tolerance for risk, you may want to become more conservative with your savings and investment choices at this stage.
  • Guard against ”lifestyle creep,” where you become accustomed to living the ”good life” now. Higher expenses will quickly eat up the income you are saving for your retirement.

When retirement is around the corner…

If you’ve only saved a small amount, you may have to consider working a few years beyond the average retirement age of 65. This will give you a chance to boost monthly government benefits, build up your investments, and reduce the number of years that you’ll need to rely on your retirement assets.

Don’t be discouraged – speak with an expert to come up with a retirement savings plan that’s unique to your situation. With the right guidance, you might be pleasantly surprised at how quickly your savings can add up!