Retirement and the Risks of Financial Instability
Retirement is a relatively new concept, introduced in the last century and likely to balance the modern economy when life expectancy grew and people were living much longer than they ever had before. Today, this lifestyle is highly sought after and idealized but, without the appropriate savings, not working can prove to be financially challenging for many seniors across Ontario.
Budgeting is an important tool to help you achieve stability during this timeframe, and perhaps even enable you to enjoy your “golden years” like you anticipated. Unfortunately, not everyone earns substantial money during their working years or invests enough into their RRSP to provide much help as they get older. These effective financial practices may not come naturally to everyone, but D. & A. MacLeod offers debt help in Kingston and Eastern Ontario for clients looking for guidance to manage their finances should they find themselves unable to maintain the lifestyle they once enjoyed.
Managing Your Finances through Retirement in Ontario
Although seniors tend to spend less on social events and entertainment, most experience a rise in medical and household expenses as they age. Our health inevitably begins to decline as we get older and retirement or nursing homes can be expensive. If you choose to and are physically capable of remaining in your own home, there are mortgage or rental payments, property taxes, maintenance, hydro, phone, cable and internet costs to consider – not to mention unexpected household repairs or money lost from bad investments or scams. Affording day-to-day living expenses may be difficult without having a substantial savings accounts or RRSP.
Over the past four decades, the Canadian government has provided financial supplements to help seniors maintain stability. The Canada Pension Plan, Old Age Security, and Guaranteed Income Supplement programs were all introduced and adapted with this intention in mind. Some provinces also have their own pension plans.
Despite not earning as much income as they likely did while working, seniors who have adequately saved money over the course of their lives often have accumulated enough “wealth” to help them to comfortably enjoy retirement. D. & A. MacLeod is available for debt help in Kingston, Ottawa and surrounding areas of Eastern Ontario if money matters start encroaching on what should be a worry-free time of your life.
Some seniors may lack consideration that they need to alter their spending habits when they stop working. Gift giving, vacations and other relatively frivolous purchases cannot be made as nonchalantly when they are no longer earning a salary. Most seniors live, instead, on a fixed income. Therefore, it is important to be mindful of changes to the amount of money coming in so you can adjust your spending habits as needed.
Another useful method to avoid financial instability in retirement is downsizing your home, especially because you can sometimes earn a large profit, pocket the rest, and lower the costs involved in maintaining it.
Tips for Saving for Your Retirement and Maintaining Your Lifestyle
Many young adults feel that they have a lot of time ahead to begin planning for their retirement, but in fact the earlier you start saving, the better. If you get into the habit of saving a portion of your paycheque each month, this amount will begin to accumulate over time. You can also set automatic deposits a few times a month so that the money goes straight into your savings account. It is also important to develop a goal, calculating how much money you make currently and how much you will need to sustain your lifestyle based on when you expect to retire. Having this goal in mind will allow you to plan ahead, begin making contributions early, and seek assistance prior to retirement to establish a strong financial base.
When to Contact a Licensed Insolvency Trustee in Ottawa
In some ways, seniors can actually face fewer financial challenges as they are less likely to have dependents and more likely to own homes with their mortgages paid off. However, it could be more challenging for people over 65 to keep track of paying bills and have less money with which to do so.
If you’re currently experiencing financial instability in retirement, or foresee you may have issues in the future, we are available to help. D. & A. MacLeod Company Ltd. provides debt help, consolidation assistance, consumer proposals, and bankruptcy to all clients in need, including seniors.
Contact us today online or by calling 613-236-9111 for a free consultation at the location nearest to you.