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Old 09-23-2023, 04:44 PM
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Dean2 Dean2 is online now
Join Date: Dec 2008
Location: Near Edmonton
Posts: 14,804

Map you do make a good point. When you are to the point of calcualting a budget or retirement spend you are likely close to retirement. If you don't have enough saved all it really tells you is you need to keep working or drastically reduce your life style.

In our case, my wife has kept a detailed budget for close to 35 years. It has always been an integral part of our detailed financial plan. Budget or no, what actually makes the biggest difference is to start saving significant amounts as soon as you start working, and no later than by age 25. The power of compounding works best over the longest period you can do it for. I know I tend to harp on this point a lot but it really is the very best chance for success.

In reality, the budget just helps you maximise saving while also ensuring you have enough funds to really enjoy life as you go along. Stuff that is great fun to do at 30 isn't so interesting at 70. You need to balance savings with also enjoying your life. Enough stuff happens there is no quarantee yo make it to 40 let alone 85.

Something people really need to think about is the high cost of care. If you don't qualify for a subsidy, a full time care home runs about 9 grand a month. In home care runs 40 bucks an hour, so full time care would be 100,000 a year.

Last edited by Dean2; 09-23-2023 at 05:03 PM.
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Old 09-23-2023, 06:29 PM
big zeke big zeke is offline
Join Date: Jul 2007
Posts: 1,063
Default It's not hard if you want it

For us, we keep track of all spends greater than $5 in something called the money book located in the kitchen. We write down date, vendor, payment method, amount and description and at the end of each month total the spend against the income, divvy the spend into categories and figure out which are one-time (like winter tires) and which are ongoing (like utilities). Over a dozen years we have a good handle on our spend as well as areas we can trim if needed.

Likewise, retirement savings has been a focus for 30+ yrs, compounding puts far more into the nest egg than I ever will. Currently the nest egg grows by 10X what our annual spend is.

I have friends who start retirement planning at 45 or 50, it's tough to shovel enough into the account to retire comfortably...these same folks get new vehicles every 5 yrs and 2 flying vacations annually. For them a 7 figure nest egg is as likely as living on Mars.

All the books, advice and guidance on earth is worthless unless you are committed to implementing it...guess it depends how bad you want it.

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Old 09-23-2023, 08:14 PM
HVA7mm HVA7mm is online now
Join Date: Jun 2010
Location: Edmonton
Posts: 1,183

It's tough to say how large of a nest egg will be required, without a crystal ball pretty much everyone's situation is going to be different. Lifetime earnings will come into play as will lifestyle, spending habits, children, divorce, personal health, savings/pension, debt etc. Like everyone has stated there is no one formula to determine what will be necessary, as life can change in a heartbeat. For our own personal situation our plan was never super detailed other than living within our means, paying down debt as quickly as we can and never feeling the need to drive new vehicles.

We're 53 & 51, the house was paid off 4 years ago and pretty much all renovations and maintenance items have been done, no outstanding debts. We're not retiring yet (although I accepted a voluntary separation package from my job of 26 years a couple of months ago) and plan on working for a few more years and my wife is still working full time. We have a daughter entering post-secondary, but have been putting away for that since she was an infant as well so it should be covered. We're both healthy and active and plan to stay that way barring any curve ball that may be thrown our way.

We were never high wage earners but have always managed to balance a good lifestyle with putting away for retirement. Time will tell, but if all of the stars align and we continue to lead a healthy active lifestyle, I think that we'll be just fine.
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Old 09-24-2023, 03:30 PM
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TBark TBark is offline
Join Date: May 2007
Location: Fort Sask, AB
Posts: 4,901

Pretty close to right on track when this thread was posted in 2020.
Said 3 to 4 years and pulled the pin a couple weeks ago & I feel pretty good about it, but the darn elk aren’t cooperating, ha. Yet.

We’ll see if the invitation to jump back in contracting come my way by year end.
Can then decide as all that will be toy money anyways.
That’s the condition for going back I expressed to the wife, as we don’t need it to live.
So I’d commit to it for a yr or so only if we “really live” from that added income.

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Old 09-25-2023, 11:43 PM
roper1 roper1 is offline
Join Date: Aug 2012
Location: Strathmore
Posts: 5,519

Lots of real world experience here. Thanks guys! I started saving at 22, owned one new vehicle in my life, still have it. Like to hunt & fish & boat as much as possible, feels like I need to work a few years yet. Thanks again!
If you're not a Liberal when you're young, you have no heart. If you're not a Conservative when you're old, you have no brain. Winston Churchill
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Old 09-27-2023, 11:35 AM
Drewski Canuck Drewski Canuck is offline
Join Date: May 2007
Posts: 3,848

What ever happened to the mantra of having $1 Million dollars to retire on?

Simple, with Inflation, and bloating tax bills, and crazy Carbon Taxes, none of us can ever be sure we will have enough to retire on. That, and we are living alot longer!

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Old 09-27-2023, 04:48 PM
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Dean2 Dean2 is online now
Join Date: Dec 2008
Location: Near Edmonton
Posts: 14,804

Here is the correct approach to planning for retirement. These guys think about it in exactly the way and terms I have advocated for years.


With our Paycheque Portfolio™ approach, retirees spend income not capital
Because retirement income should last a lifetime.

A Paycheque Portfolio™ Approach: Retirement Income the Right Way

Daryl Diamond
Chief Retirement Income Strategist
Have you ever been driving somewhere and suddenly find yourself wondering if you’ve got enough fuel to complete the trip? Your gas gauge is flashing yellow, you’re an hour from your destination, and there’s not a service station for miles. We’ve all been there. It’s an unsettling feeling, which makes for a very stressful journey.

Running on empty is never a good feeling – especially when it comes to retirement.

How enjoyable will your golden years be if you’re constantly worried about running out of money, or if every single decision has to be weighed carefully with an eye on your monthly investment statements?

Unfortunately, that’s the reality for many Canadians. According to a recent survey¹, half of Canadians said they often worry about outliving their money, while 76% plan to work longer than their parents to retire comfortably.

As a former advisor with 40-plus years of experience in the industry, I’ve spent the better part of my career helping clients build the sustainable income they need in retirement. For most people, entering the retirement phase is a really big transition. For their entire working life, people have been building their assets, and now all of a sudden they’re in a position where they’re in the spending phase of retirement. Psychologically, that's a big corner to turn for people.

It's also a period of conflicting objectives. On the one hand, retirees want to spend money and perhaps travel while their health is good; on the other hand, there’s a very real fear of outliving their income. And there’s no shortage of news items stoking retirees’ fears – especially articles about that “magic number” they’ll need to live comfortably. Is it $500,000, $2 million, or $5 million? In my experience, there really isn’t a “magic number.” It’s not a realistic approach.

How do you build a viable retirement plan when so many variables, like quality of health and life span, are unknown? That’s why a focus on income is so important.

Changing the Retirement Conversation: From Decumulation to Income
As Canadians enter retirement, we often hear the word “decumulation” to denote the spending phase. However, I’m not a fan of that word, and here’s why. When we talk about accumulation, it brings to mind a buildup, or increase, of capital that will subsequently be used to generate the income retirees will need.

However, the word “decumulation” suggests the exact opposite: that we're on a critical path to totally spending all of our money. We don't want that to be the mindset of the retiree. By eliminating the “decumulation” mindset, we're making retirees more comfortable with this idea of the sustainability of their assets to deliver that retirement income.

Want to know more?
The Big Shift(PDF Opens in a new tab)
Retirement Income Map(PDF Opens in a new tab)
Retirement Challenge(PDF Opens in a new tab)
Dynamic Yield Curve(PDF Opens in a new tab)
Paycheque Portfolio™ Approach: Re-envisioning Retirement Income
Retirement doesn’t have to be an inevitable depletion of assets. That's not been my experience with the clients we've worked with over three-and-a-half decades – and that’s across a broad range of wealth levels.

Instead of focusing on a “magic number,” the key is having a strategy that allows us to continue to deliver the retirement cash flow people need, but at the same time, not be selling the investments that are generating that income – especially at a point in time where the investments are down in value. This distribution strategy, which I call the Paycheque Portfolio™ approach, has one central focus: to deliver consistent income in bull and bear markets alike.

In the 15 years we used the Paycheque Portfolio™ approach, if we didn't sell the investments, if we didn't move to cash (even when we're taking income from the portfolios), the account values have always, without exception, recovered and ultimately exceeded the value that they were prior to the downturn in the market.

Four Simple Words: Spend Income, Not Capital
As a retirement income planner dedicated to building sustainable cash flow I was continually focused on four key words: spend income, not capital, which is really the central focus of the Paycheque Portfolio™ approach. It’s a strategy that lets income arrive without having to sell anything – even in market downturns.

The point being, you don't have to sell anything to get the paycheque you need to fund your retirement, which allows time for the investments to recover in value after they've gone down. We have seen that little miracle repeatedly. I cannot underscore how important the last part of that phrase is, psychologically speaking, when markets and account values are down. The income is steady, in bull and bear markets alike.

"Spend the income, not the capital," is a motto that people can embrace and understand. They can see it. It's proven to them over and over again that it's efficient, that it works, and that it’s sustainable. And it’s extremely easy to service for advisors. That's worth a lot for both clients and advisors.

While no retirement strategy is perfect, paycheque portfolios sure check a lot of boxes.

¹ Source: Benefits Canada, “76% of Canadians expect to work longer than their parents to retire comfortably: survey,” May 26, 2023.


Registered Retirement Savings Plan (RRSP)
The purpose of an RRSP is to save by decreasing your taxable income and deferring tax payments on your investment until retirement.

Opens in a new tab

Tax-Free Savings Account (TFSA)
The Tax-Free Savings Account is a flexible registered savings account that allows for tax-free withdrawals and helps investors to save more.
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Old 09-29-2023, 06:44 AM
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SuperCub SuperCub is offline
Join Date: May 2014
Location: SJ, NB
Posts: 404

Originally Posted by huntinstuff View Post
Nailed it

Retire and enjoy yourself. Be satisfied. Decide on an age and do it. Dont trade years for bucks. Its a poor trade.

There is no magic age. Everyone is different.
Everyone IS different is right!

I can retire at any time. 63yrs old. Healthy, no debt, two newer vehicles, $1,000,000 pension with a pretty good TFSA. Sounds like I'm bragging but my point is that I'm still working because I still enjoy my job. Don't hate getting up every day and going in along with the fact that at my age they don't give me many crappy jobs any more. I might pull the pin next year and head to our moose camp in Ontario with my brothers next fall.

I know others that choose to work for the same reason.
"The majority is never right."
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