retirement is a life transition that will be a massive shock for most of you so in this video let's go through 10 things you should do in the 10 years leading up to retirement to get you prepared both financially and psychologically so you can live a successful retirement from day one the first thing you want to do is assess your Current financial situation where are you at how much debt you have what are you saving where are your Investments at so many of you are not actually tracking and assessing on on an annual basis or even more often what's going on in your financial world are you actually getting ahead are you moving closer to retirement from a financial standpoint we have a net worth tracker as well as a budget form you can download from our website we'll link those below if you need help with that again you want to start tracking your budget and it doesn't have to be a strict budget I get you get later in life doing a budget like no one wants to do that but as you work through your net wor worth tracker if it's not increasing on an annual basis you might have to go back to the budget and get things align so again assess your current situation step two is to maximize your retirement savings so once you understand where you're currently at now we need to make sure we're maximizing for retirement now a lot of you might think well that's maximizing my pension my RSP like retirement savings tools but maximizing for retirement doesn't necessarily mean all of your money is going into an RSP it could be a tfsa it could be paying down debt again the whole idea of saving for retirement is to put yourself in the best financial position for retirement yes that probably means accumulating more funds in your retirement savings accounts but it also means paying off debt paying off your mortgage or at least paying down your mortgage saving money in a tfsa if you retire without money in a tfsa you have a lot less flexibility so start saving up in a tfsa you're not going to get the tax break now but it might create that more flexibility in retirement saving you tax later so again it's a balance between all of this stuff and that's why I say it's really important to make sure you have a proper plan in place 5 to 10 years before retirement so if there are adjustments that you need to make you have a bit of a Runway to make those adjustments and for those of you that have a pension at work or maybe a matching RSP Planet work make sure you're maximizing those so many people we talk to are not maximizing free money from work like if your work matches you 3% of your pay and you're only putting in 1% find a way to get to 3% we all want to make more money but then there's things like this we're not maximizing on so make sure you're maximizing that work matching Plan before we jump into tip number three if you're not already subscribed to the channel hit the Subscribe button join our community we release two brand new videos every week around tax retirement and estate planning for Canadians tip number three is to create a retirement budget and it's a budget slsh list and again I know later in life budgets are no fun but you want to have a general idea of how much am I going to spend how do my finances change a little bit as I enter into retirement you might be traveling more so you're spending more in certain areas but you're not commuting to the office and other expenses so those are coming down so again work through this sheet and one thing you want to add in there is many of you have bucketless items and if you don't have a bucketless item create that bucketless item what are the cost to do those things you need to be considering those in your plan and that's why it's important to have that tfsa account because if you want to go on a very expensive trip or buy something very expensive and all your money is in registered accounts it doesn't create a lot of flexibility and you're going to end up paying a lot more tax than you should be otherwise so again this is why everything needs to come together I always say if you look at retirement planning in individual silos you're lining yourself up for disaster both from an income standpoint and a tax standpoint you need to look at everything holistically and that's why it's really important to make sure you have that bucket list what do I want to do down the road so actions I take now on where and how I save my money will line me up better for retirement tip number four is to pay down your debt now I realize that real estate in Canada is through the roof it's very expensive I live in the Greater Vancouver area and homes around me are $2 million for a basic family home which is crazy I don't I don't know how these young people are getting into the market but as you get closer to retirement you may still be carrying a mortgage and that's okay when you build out your retirement plan you can build in the cost of that Mortgage in there the payments just make sure you can afford the ongoing payments stress test it in case rates do go back up don't see it happening but you never know so stress test it but when we talk about paying down debt make sure if you do enter retirement with any debt the only debt you have is your mortgage if you have credit card debt line of credit anything else car debt pay that off before you retire it's going to give a lot more cash flow flexibility for you which you will need in retirement don't take a car loan one or two years before retirement and carry that into retirement not a great idea pay cash for vehicles so as you get closer to retirement you need to change your mindset around debt try and get rid of everything you have other than your mortgage and if you can get rid of your mortgage try and do that too tip number five is to evaluate your insurance needs and this is probably not you need more insurance it's probably it's time to get rid of your insurance now leading up to retirement until retirement for most of you you're earning income you might have some debt to pay off you're still in accumulation phase especially those last 5 to 10 years before you retire that's typically The Sweet Spot we're able to save a lot more like a lot of your retirement savings happens in that last 5 to 10 years so especially if you're married or Comm or someone relying on you then you need to make sure you still have your life insurance because if you pass away you might have 2 5 10 years of a lot of savings that's just not happening anymore and that's very costly for the other person potentially but as you get closer to retirement continue to assess with your financial planner if your insurance is still needed we do a lot of retirement plans for people that have entered into retirement that are carrying a term life insurance policy they're paying hundreds of dollars a month for and we and there's not a need for it anymore if they pass away there's enough money there for the other person to live the life they want in retirement so again insurance is very very important as you lead up to retirement for some of you you still need it in retirement but for a lot of you you don't now for some of you as you get close to retirement you have renewals coming up ah should I carry my insurance or not for 99% of you you still need to continue with your life insurance until you retire again maybe even a little bit into retirement because there might be someone relying on that need especially like disability insurance what happens if 5 years before retirement you're a single person and you become disabled who's taking care of you how's that working again run through these scenarios we don't want to face it but we need to plan for it so again talk to your financial planner to make sure that this is built into your retirement plan tip number six is to plan for healthare so this is very important in that a lot of you have health care coverage through work they're going to pay a percentage um of your premiums up to a certain amount you're somewhat covered at work for most of you when you retire that coverage is gone so how are you going to pay for it and I'll say this most of Canadians pay out of pocket for healthc care that is not covered through MSP or whatever Province or territory you live in there's some provincial territory coverage above that you're paying out a pocket now again your typical health and dental plan you need to run the numbers what we recommend for most people is to look at an individual plan so you can go to say manual life or Blue Cross and buy an individual health and dental plan what's the premium and what's the benefit to you and then look at on an average year how much would I use and are you getting value out of it and a lot of times you may not be so again run that test for you you know if you go to you know dentist and you do some medications and maybe massage and chyo whatever it is add all those expenses up and then pretend you ran them through again a lot of those plans only cover you up to you $25 or $50 per practitioner per visit only 80% for dental up to a certain amount so run it through there compare it to the premiums that you need to pay and see if it makes sense and again a lot of these plans as you get older the premiums increase over time but your benefit doesn't increase so just be aware of all these things so are you better paying out a pocket or you better having a plan that's one thing you need to look at the other thing is as you plan for retirement you need to ensure like what kind of medication what is my typical cost and making that in your budget as well again that needs to be part of your retirement budget the last part of it is healthc care later in life in home care or a care facility and again the large majority of you watching this video will not need that but we all know people that went to a care home it was very expensive so this is a conversation you want to have with your financial planner everyone has a different mindset and need for this so again open up that conversation with your financial planner to figure out how can you plan forward both from now to retirement and then through retirement for your expected health care costs the seventh thing you need to do and this is really important is to update your estate plan now when we talk about estate plan there's two parts of it one part of it is what your lawyer or notary will do for you which is create your will and power of attorney kind of your legal document saying when I pass away or if I become incapacitated here's what happens or here's who gets the money the other part of it is with your financial planner to figure out how do do I create a retirement plan that if I pass away there's the most amount of money possible after tax going to the people so that's with your financial planner that's what your financial planner should be doing for you so when we say look we do estate planning it's around your tax plan so we're not doing the legal documents we're doing the planning around okay you want to leave all your money to Sally but let's make sure she's getting the most possible but you're still enjoying retirement while you're alive so when we talk about updating your estate plan plan in this specific model I'm talking about your will your power of return all that many of you have not reviewed your will in 20 30 years it's outdated it's changed there's a lot of changes that happen the other part that a lot of you are missing is your digital assets we all have a digital life now whether it's you're log in through Facebook through YouTube through social media your bank login who has all that data where are you storing the passwords it's really important if you pass away that your executive knows how to access these accounts again there's kind of master password options out there last pass and many others one pass that you can use you need one main password once you're logged in you can see all your other passwords that's one option some people write it down and save it somewhere but again you want to make sure your will your power of attorney and you have this Digital Life documented because if you don't have it documented how is your executive going to get access to shut down your Facebook page right you don't want to get birthday wishes on your Facebook page 10 years after you're dead just a little awkward so make sure your executive has that information or at least knows where to access that information when you pass away number eight is to determine your retirement age and a lot of you typically will have an age set in stone so it might be 60 65 somewhere in between typically might be 55 might be 70 but a lot of us have it preset of I am retiring at 65 because that's what my dad did that's what my my neighbor did that's when my co-workers do or maybe that's when your pension goes to there's many reasons why we pick certain ages but I encourage you to sit down with your financial planner to actually map out a retirement plan it amazes me how many times we'll do a plan for a client and we're like yeah you could have retired 3 years ago or maybe it's you're 10 years from retirement but if you want to retire at 8 years you could do that so it opens up those conversations it also goes the other way sometimes where they want to retire at 60 and it's like you know what you're going to have to go to 63 if you want to live the retirement you're hoping to live so again you may have a set date or age in your head but make sure that your retirement plan actually lines up with that date again you might be a bit before a bit after that's really important data to know most of us don't want to work longer than we have to some do most don't so make sure you understand when you can retire not when you want to retire but when you can retire tip number nine is to plan for postretirement activities so a lot of you are going to pick up new hobbies or continue with hobbies that you did earlier in life I talked to someone the other day and they used to be really into music guitars earlier in their 20s and 30s and then life took over and they've just retired at 60 and they're picking it back up and they actually are quite involved with it so again is it something you did in the past or is this a new hobby that you need to pick up so again that's where I talked earlier about listing what you want to do what are your bucket list items some of those might be Hobbies travel excursions whatever it is but if your goal is I want to go you know do a you know two-day hike but you've never hiked before you may need to start training for that or planning for that or getting in shape for that if it's musical instruments what you want to play should you start learning and dabbling in that now so that when you hit retirement you have that base understanding so figure out what you think you want to do in retirement it may not be perfect but start kind of planning around that what do I want to do in retirement and what do I need to do leading up to retir ironment to put myself in the best situation so I can actually do them and enjoy them and and take them fully tip number 10 is maybe no surprise to a lot of you but it seek professional advice and I know a lot of you do your own DIY plans and you think they're fantastic and some of them are decent I won't lie but they're not fantastic you need professional advice talk to your financial planner there's a lot that goes into a proper financial and retirement plan there's a lot of moving Parts I talk to 20 or 30 of you every single week and for a lot of you we're thinking of retirement in a silo and again I always talk about these silos and these silos will be a detriment to you leading up to an into retirement so talk to your financial planner if your financial planner is more investment focused or Insurance focus and they don't get into the nitty-gritty of retirement tax planning reach out to our office we offer fee for service retirement plans you can learn all about them our costs everything's involved in them on our website parallel wealth.com /pl we have all the details there if you want to set up a call with our office to chat more to figure out if it's the right fit um there's a link on that website to book a call with us so again reach out to your financial planner reach out to our office or another financial planner but get a professional on your side to work with you you want to retire once and you want to do it right most of you are paying too much tax you're not drawing down your accounts properly not taking government benefits at the right right time you're doing a lot of things wrong and it's costing you a lot of money and sometimes it's worth it to pay some money up front to get some professional advice right we do it with accountants and everything else we want to do it with your retirement plan I want you all to retirement in the best position possible and these 10 tips I have for you today will help transition you in that phas but that final kind of piece to it all is to get someone that knows how to do this to come alongside you put the plan in place make those adjustments to make sure that you're walking down the proper path make sure your GPS is going in the right direction so reach out to your financial planner if you need help with it reach out to our office we'd be happy to help you and all the best as you plan for retirement and walk into retirement with the best plan possible