Prepare for Retirement

The years after retirement can make up 25%-35% of a lifetime. Making sure this time is enjoyable requires thought and planning, which means looking realistically at the challenges and opportunities that people face at retirement. Some things to consider include:

  • Lifestyle: will your lifestyle change? Consider what retirement means to you.
  • Time or money: consider the trade-offs when choosing when to retire.
  • Financial certainty: plan for the financial unknowns (such as health care expenses).

Maintaining Your Standard of Living

Over the past 20 to 30 years, most Canadians with stable jobs have enjoyed a steadily improving standard of living. However, it's unrealistic to expect that this trend will continue after retirement. Concentrate your efforts on keeping the standard of living that you enjoyed during the years just before retirement.


Inflation represents the largest single threat to your purchasing power. Your sources of income should offset inflation as much as possible, without creating a level of risk that you’re not comfortable with.

The Need to Budget

Making a budget, sticking to it, and managing your money well are most important after retirement. You may already be doing this, but your spending patterns will change after retirement and your expectations will be different.

Special attention to money management will become crucial. Discover where you stand financially by completing the Current and Future Expenses worksheet to estimate how your expenses will change, category-by-category, when you enter retirement. Use the Income, Expense and Saving Statement to create a summary of your income and expenses, now and in retirement. Update both worksheets annually, identifying where adjustments are needed for your plan to stay on track.

The Need for New Learning

You'll need to know about financial instruments, such as annuities, and retirement income vehicles, such as life income funds (LIFs) and registered retirement income funds (RRIFs). These may be completely unfamiliar to you. You should also be aware of the special income tax provisions that affect retired people.

Life Expectancy and Bereavement

If you're married, it's almost certain that one spouse or partner will outlive the other. Therefore, it's important to make sure that the survivor will have an adequate income.

Educate Yourself Financially

It’s important that you know what to do and how to maintain control of your finances. Educate yourself in the tools, language, and art of managing your finances.