Financial planning can help retirees do what they want, and not what they need to
TORONTO, Feb. 3, 2015 /CNW/ - For many people, retirement no longer marks the official end to their working lives, but rather the starting point for fulfilling the dreams they want to accomplish. Whether it's volunteering for a favourite charity, starting a small business or working part-time at something they're passionate about, Canadians have big plans for their "freetirement."
"The idea of retirement has changed dramatically as people are living longer and want the freedom to do meaningful things in their later years," said Linda MacKay, Senior Vice President, TD Retail Savings and Investing. "This is why more and more people are coming to think of it as 'freetirement' rather than retirement. Retirement may have been viewed as an end goal in the past, but many retirees and pre-retirees now see it as another one of life's milestones. People still want to travel and spend time with family, but a significant number also want to stay productive and engaged during their retirement and are looking for the financial means to do it."
A recent TD survey found that more than a third of people aged 18-64 want to work part-time or casually at something they love after they retire, one in five wants to volunteer and one in 10 wants to start a small business. The survey also found that the most popular ways to finance these 'freetirement' dreams are with RSPs, general savings, pensions, and investments.
"For many Canadians, saving for retirement - and goals beyond retirement - may seem daunting and talking to an expert can help to make it feel more approachable," adds Lee Bennett, Senior Vice President, TD Wealth Financial Planning. "Regardless of where you're at in your savings journey, it's important to figure out, while still working, how much money is needed for the future so that you can develop and follow a financial plan to make it a reality. A financial planner can help find the best options for individual circumstances and dreams, and also help make the most out of savings and investments once in retirement."
Bennett and MacKay have some other tips to help people save for their future:
Contribute regularly to an RSP: Setting up a series of regular payments into an RSP is one of the easiest ways of saving money for the future and possibly reducing tax obligations, yet nearly half of Canadians aged 18-64 don't contribute to one and more than a third of those who do wait until close to the annual deadline. While every contribution is a step in the right direction, making it a regular habit every week or month can help people reach their 'freetirement' dreams even faster.
Build savings faster with a TFSA: Tax-Free Savings Accounts help build savings faster as the investment income or growth earned in them is not taxed. The current maximum annual contribution limit is $5,500, but any unused contribution room can be carried forward.
Turn tax returns into ongoing returns: 70 per cent of Canadians expect to get a tax return this year and many of them plan to save at least part of it in an RSP, TFSA or other savings account. An easy way to boost retirement funds is to consider increasing the amount of the refund saved, as well as saving any bonuses or monetary gifts received during the year.
About the TD Working During the Golden Years Poll
TD commissioned Leger to conduct an online survey of 1,912 Canadians between November 3 and November 9, 2014 using Leger's online panel, LegerWeb. A probability sample of the same size would yield a margin of error of +/-2.2%, 19 times out of 20.
About TD Canada Trust
TD Canada Trust offers personal and business banking to more than 11.5 million customers. We provide a wide range of products and services from chequing and savings accounts, to credit cards, mortgages and business banking, to credit protection and travel medical insurance, as well as advice on managing everyday finances. TD Canada Trust makes banking comfortable with award-winning service and convenience through 24/7 mobile, internet, telephone and ATM banking, as well as in over 1,100 branches, with convenient hours to serve customers better. For more information, please visit: www.tdcanadatrust.com. TD Canada Trust is the Canadian retail bank of TD Bank Group, the sixth largest bank in North America.
About TD Wealth Financial Planning
TD Wealth Financial Planning is a division of TD Waterhouse Canada Inc., a subsidiary of The Toronto-Dominion Bank.
SOURCE TD Bank Group
For further information: Natasha Ferrari, TD Bank Group, 416-983-7180, firstname.lastname@example.org; Laura Tulley, Hill+Knowlton Strategies, 416-413-4635, email@example.com