What You Need to Consider When it comes to Retirement Planning

Planning for your retirement is important.  Whether that involves long term investing, savings accounts, or some other combination of financial products, there are bevies of ways you can ensure your long-term financial health.

While The Rothenberg Group retirement planning, there are a few key things you are going to want to remember to ensure the best possible outcome down the road.

Think Long Term

Most of us are not used to thinking in such broad, long-term ways, however, this is the key to successful retirement planning. You need to think not only about what you are going to do once you stop working, but also how long you will live, and what it is that you want to do during that time frame. With modern health advancing at a remarkable pace it is not unreasonable to think that people coming into retirement age within the next decade or two will continue to live until they are 90, or maybe even further. In addition, older people can be more active than in past generations, which means that retirement might be more about travel and events than settling into a home (or in a family home).

It is important to understand that Government of Canada benefits, at this time, only nets about $1,200 per month. For most people, that is not nearly enough to live comfortably in Canada.

Do Not Overlook Inflation

Remember that when you plan long term you have to try to imagine the landscape of the future—that things are going to change. With that change, inflation can hit you like a ton of bricks, if unprepared.

Here is an example:  if inflation grows at 2 percent, an initial investment of $50,000 would be worth only $30,477 in just 25 years.  On top of that—and following the same inflation rate—something that might cost $50,000 today would cost nearly $83,000 in the same time frame.  It probably seems complicated and it is; so either spend the time to learn about these variables or spend the money on professional retirement planning to ensure you don’t miss something like this.

Consider Market Volatility

Much like inflation, market volatility is something that many people new to investing overlook. Essentially, volatility describes the market’s likelihood to fluctuate; and in many cases that fluctuation can be unpredictable.

Balance Your Portfolio

Finally, you are going to want to consider several investment options that will round out your options.

Balancing and diversifying your portfolio gives you more flexibility not just in your investment outcome but also in your opportunities.