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Retirement Planning: Make Sure Your Advice Keeps Up with Your Clients

Posted: December 05, 2017 By : Doug Nelson
Posted in: Strategic Thinking, Debt Management, Financial Literacy, Financial Advisor, investments, knowledge bureau, statistics canada, Evelyn Jacks, rrsp, tax courses, retirement planning courses, tax advisor, retirement income, wealth management, doug nelson, financial education, Baby Boomers, year-end planning, retirement plan

According to recent census data from Statistics Canada, the baby boomers continue to live life on their own terms, especially as they approach and surpass the traditional retirement age, but they are working longer, supporting adult children and often they are also in debt. The provides opportunities for interaction with retirement specialists.

It is estimated that more than half of Canadian men aged 65 or older were working in some form in 2015, and approximately 23 percent worked full-time throughout the year. How has this changed over time? In 1995, statistics at that time suggested that approximately 38 percent of men aged 65 or older worked in some way (vs. over 50 percent today). At the age of 70, nearly three in 10 men did some sort of work in 2015, twice the proportion of 20 years earlier.

Is this trend of working in retirement growing because Canadians are entering retirement with higher levels of debt? Is it because their children are living at home longer? Or is it because the retirement years are that much longer, so it only makes sense that the start of retirement would also be later?

Regardless of the reason, this data confirms the importance of building flexibility into every retirement plan:

  • Model different retirement scenarios: It is very important to model different retirement planning scenarios so that clients can see how different events or decisions will impact their situation today and in the future.
  • Update the plan every 12 to 36 months: Things can change quickly to impact a client’s income and tax picture. To avoid a negative tax outcome, frequent review of income amounts for each spouse, his/her tax brackets, charitable giving and tax withholdings goes a long way to making sure that retirement savings are drawn in an efficient manner over time.
  • Continuously look ahead one to three years: Are your clients living the life they most wish to live? The retirement years are typically a series of two- to three-year cycles that can change over time based on travel desires, health and grandkids. Keep up to date with your clients on they view the next one to three years and determine if their income plan needs to adapt based on their changing lifestyle plans.

Providing this type of individual, customized service makes you an invaluable advisor to your client, while also helping to reduce risks along the way. Boomers will always live their life in a unique, innovative way. Adapting your approach by providing insightful and meaningful advice will always put you in good standing. The Tax Efficient Retirement Income Planning course from Knowledge Bureau has recently been updated to help you better serve the needs of this demographic.

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