With $1.9 mil­lion net worth, cou­ple has the means to hit their tar­get

National Post (National Edition) - - FINANCIAL POST - An­drew Al­len­tuck

In Toronto, a cou­ple we’ll call Harry, who is 76, and Louisa, who is 63, are hang­ing on to their jobs. Harry, an en­gi­neer, is par­tially re­tired, Louisa, a fi­nan­cial man­ager, is still work­ing full time. For now, they bring home $14,912 per month com­posed of $6,400 Louisa’s salary, $3,000 from Harry’s busi­ness, $2,400 from in­vest­ments, and a to­tal of $1,512 from Harry’s OAS and CPP plus rental in­come of $1,600 per month. They live in On­tario. They ap­ply man­age­ment skills to re­tire­ment plan­ning. Their is­sue: do they have ad­e­quate re­sources for life ahead?

When re­tired, Louisa can ex­pect $68,000 in com­pany pen­sions and Old Age Se­cu­rity of about $6,860 for hav­ing been res­i­dent in Canada for 38 out of the 40 years re­quired after age 18 to qual­ify for full ben­e­fits. Harry al­ready re­ceives OAS and CPP ben­e­fits.

By most stan­dards, Harry and Louisa are pros­per­ous, but they worry about what will hap­pen to their way of life when Louisa ceases to gen­er­ate her $12,000 monthly salary. There is some un­cer­tainty about when she should be­gin draw­ing CPP and OAS and when to start draw­ing down Reg­is­tered Re­tired Sav­ings Plan bal­ances.


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