Am I Ready for Retirement?


Are you financially and emotionally ready to retire? What are the things you should consider when thinking of retirement? Here, we discuss some of the necessities for determining “retirement readiness.”

Goals for Retirement

When deciding to retire, the first step is to have your own fine-tuned vision of what retirement looks like. What are your goals for the next life stage? To better understand yourself, you might consider filling out a goal-setting questionnaire, such as this True Wealth Questionnaire that we frequently use with our clients.

The purpose of our easy goal-setting questionnaire  is primarily not financial, but mostly about measuring where your life is today and what you want your future to look like.

Financial Ability

Once your lifestyle vision is sorted out, it is time to shift the focus to the financial planning side. Try to estimate a financial plan that projects the next 30 years or so.

Consider talking to a financial planner to get a good sense of what your lifestyle will be like in retirement if you retire today, or at a certain point in the future. A comprehensive financial plan will expand on other issues too, like how much you can afford to help Three steps to knowing when you are ready for retirementyour children or grandchildren, or how to support your favourite charities. Based on your financial ability, you might get a “green light” for retirement, but it doesn’t mean you should retire.

Personal Considerations

Of course, financial ability is not the only concern for retirement.

For many of us, our jobs are an important part of our identities and can be very difficult to give up “cold turkey.” Also, retirement can significantly alter the balance and routine that currently exists with your spouse or partner – sometimes in a bad way.

Another issue is how to fill all of your free time. Without a plan that reflects your retirement vision, hobbies and goals, the free time can lead to depression. Eileen Chadnick, a certified coach and principal at Big Cheese Coaching in Toronto, says it is a mistake to plan for a life of full-time leisure, “Seven days of fishing gets stale very fast. The balance paradigm shifts in retirement. The key is to determine what the right balance is for you”

The issue of retirement has become much more complicated than simply aiming for a financial number. Much like other things in life, a successful and happy retirement takes planning – both financial and emotional.

If you want to read more, here’s an article that talks about all the things you can do in your free retirement time. It’s enough to get anybody excited!

Ten Tips for a Better Relationship with your Financial Advisor


You have done the research, understood the fee structures and finally hired a financial advisor. What now? For most of us, a good relationship with our financial advisor is a top priority.

To have the best relationship possible with your financial advisor, here are ten simple tips for you:

1) Be up front about what you expect of your advisor. If your expectations are unreasonable, it is the advisor’s responsibility to make sure that things are adjusted.

2) It is your right to respectfully disagree with your advisor and not take their advice, but if you find that this disagreement is very common, then there is a poor fit.

3) Judge your advisor based on their actions and not those of your previous advisors or “the industry.” It can weaken your relationship with your advisor and hurt communication if they always feel beaten up for someone else’s behaviour.

4) You have a right to know how you are doing. If you are not being given that information or are unsure, don’t be afraid to ask.

5) Measure your adviser fairly. This means basing it on trust over time, seeing them do what they say they will do, and comparing their performance against a reasonable benchmark. For investments, remember that the TSX is an aggressive equity index overweighted in metals, energy and financial services; even among stocks, it is not the appropriate benchmark for the conservative investor.

Tips for Communicating with your Financial Advisor

6) You should call or e-mail your advisor on occasion. This keeps the line of communication open, and keeps your advisor aware that you are interested in your finances.

7 ) Respect your advisor’s time. While you can ask questions and ask for reviews, a reasonable advisor can’t devote too much time to any one client without it negatively affecting other clients.

8) While it is always your money, and you have the right to fire an advisor who isn’t doing a good job – try not to hold your business up as a threat. It simply adds stress to the relationship that isn’t helpful to you as a client.

9) If your advisor is doing a good job, say thank you. If you are really happy and feel comfortable doing so, send referrals.

10) Be honest with your advisor about whether you are happy or unhappy with their service, and provide specifics about why you feel that way. This gives you the best opportunity to improve the relationship and results.

Like any relationship, the one you have with your advisor is a two-way street. Some of the most successful people out there get to that point because they have good advisors, and because they themselves are good clients.  You  can learn more about a good client-advisor relationship from this comprehensive Wharton Business School research report on The Financial Advisor-Client Relationship.

3 Reasons to Create a Financial Plan Now


Procrastinating on our financial planning and decision-making can have a real cost.

The following article originally appeared in my weekly Globe and Mail column.

Many people put off creating a financial plan for a myriad of reasons. Most people are waiting for something: a comfort level, the fear of making the wrong move, a certainty, divine intervention or just an inability to decide.

However, the costs add up while you are waiting to make a financial decision. Here are three examples:

1) Insurance decisions: The older you are, the greater the cost of annual premiums. The older you are, the greater the chance of getting an illness that might make you uninsurable.

2) Setting up a will: Families might delay this because they cannot decide on custody of the children or assets. However, procrastination can put families in a position where the courts and Family Law will have to decide on the caregiver, and others will determine how your assets are split.


3) When to start investing again: There is definitely a timing component to investing.  But the one thing we can be sure of is that while there have been ups and downs for investors, since the 1950s, stocks have always outperformed 90-day T-bills, on a decade by decade basis. Today, we have some of the lowest T-bill rates. The odds are above average that being invested in the markets is better than cash.  If we can agree on this, then on average, procrastinating on investing will hurt your wealth.

Here are two key steps to minimizing financial procrastination:

A) Before you go into a financial discussion or decision, make a list of what you would need to know to feel comfortable making a decision.What is it that you are hoping to get from this decision? What is the downside risk of making the wrong decision, and how can you decrease the chance of this downside happening?

B) Using the list as your guideline, ask the questions needed and take the time to get the list complete. Not all answers will be black and white. There will be some more emotional “gut check” items on the list that you need to get a degree of comfort with. Once this list is complete, it is time to act.

If you are sitting on a financial decision today, understand that there is likely a real cost to putting it off. The time to make the decision is now!

Watch this short video here on how a good financial planner can help you with your personal financial decisions.