Three questions to help you build the best retirement plan for you

Your vision for retirement is unique to you, and so is your path to getting there. We'll help you start planning by asking you three key questions.

To get started, answer these three important questions:

1 What factors should I keep in mind when planning for retirement? 
2 What tools can I use to calculate how much I need to save for retirement?  
3 What are the different accounts I can use to maximize my investments?

Reflecting on these questions can help you build an investment strategy that will set you up to thrive in retirement. 

1 Factors to keep in mind

Retirement planning involves many factors—some you can control and some you can’t.

Time frame

Deciding on what age you want to retire is key. It will help you understand how many years of retirement you need to save for. The earlier you start to save, the longer you can take advantage of compound interest. You’ll also want   to set this time frame to prepare for when you’ll need to convert your retirement savings into income. 

Marital status 

If you’re married, you may want to consider both your own and your spouse’s retirement needs, whether it’s basic living expenses or additional healthcare costs. You should also make the most of spousal savings’ accounts, which can reduce fees and offer significant tax benefits. 

Type of work

The type of work you do can have a big impact on your retirement savings plan. If you’re an employee, find out what plans your employer offers and what resources are available to you. If you’re a contractor or freelancer, there may be additional steps you’ll have to take to set one up.

Number of plans

One way to simplify the retirement planning process is to bring all your accounts to one place. By having one username and one overall plan for all your savings, you can take advantage of lower fees, maximize the benefits of your plan, and simplify the overall management of your savings.  

Risk tolerance

Your tolerance to risk may change over time. Regularly reviewing your plan will ensure that it adapts to changes in your life and keeps both your immediate and long-term savings goals in line with the risk you’re willing to take now. 

2 Tools to help you save for retirement

Once you’ve identified all the factors that might affect when and how you want to retire, you can work out how much you’ll need to reach that goal. Financial calculators are useful tools to determine the next steps of your retirement savings plan.

• Calculate how much you need to save to reach your goal.
• Estimate how long the money you save is likely to last in retirement. 
• See how adding a little to the amount you save each month can add a lot more to the amount you’ll have in retirement.  

3 Your investment options 

After you've decided on a time frame and budget for your retirement, it's time to figure out which investment accounts will work best for you. 

Here are some of the more common ones to give you an idea of which might work best for your plan. 

RRSP—Registered Retirement Savings Plans (RRSPs) are beneficial for everyone because they offer many tax advantages. You can deduct your contributions from your taxable income, and your investments grow tax deferred until you withdraw the funds. 

Group RRSPs—If you’re an employee with access to employer-sponsored plans, you can take advantage of this type of RRSP by receiving employer matching contributions, which can significantly boost your savings.

Spousal RRSP—This type of RRSP is ideal for married couples who want to split their income during retirement and enjoy additional tax savings.

TFSA—A tax-free savings account (TFSA) is a great option for anyone looking to grow their investments without having to pay taxes on those earnings. You can’t deduct what you put into a TFSA, but what you take out is tax free. This gives you a lot of flexibility when it comes to investing for both the short and long term.

Non-registered investment account—The main advantage of this type of account is that it has no contribution limits. If you’ve maxed out your RRSP and TFSA contributions and still want to invest for your future,  this account is a great option for you.

There’s a lot to figure out before you can start planning for retirement. The good news is that it’s never too early or too late to start. By answering the three questions above, you’ll get an idea of what you want out of your retirement and what you’ll need to get there. To make things easier, you could meet with a financial advisor to create a retirement plan that’s perfect for you.