Turn Textiles Into Art
Knitting, sewing, weaving, embroidery, and quilting used to be done in social circles or bees and they are again. Knitting and fabric stores are often the sites of comradely needle artists, and libraries in some communities also offer classes and a place to share patterns, experiences, and skills. The Textile Artist organization acts as a network and a resource for classes and an online forum.
Tip #1: Spend Time On Your Hobbies And Pastimes
While this is one of the most common solutions to filling your time in after retirement, spend time on hobbies that will help you grow. Watching television and tons of movies doesnt count and, of course, can lead to a sedentary unhealthy life.
Get physical. Challenge your brain.
And unleash your creativity .
Bonus Tip: Get in touch with your musical side.
Coming from a musician whos played violin since I was 10, I fully understand that playing an instrument isnt for everyone. However, I also understand that musical memory is the last part of your brain that Alzheimers touches. I also know that when youre playing an instrument, your brain activity behaves like a full-body brain workout with long-term positive effects.
If not learning or playing a musical instrument, consider watching live music. It can be way more energizing than listening to a recording. Plus, its a social event.
Theres so much power and many additional benefits behind the universal language of music simply because of the impact on the brain. Scientists discovered that music stimulates more parts of the brain than any other human function. This means it works wonders for building your neuroplasticity.
It can also help patients with neurological deficits. For instance, if you had a stroke, music therapies can help bring your verbal functions back.
Get An Allotment And Grow Your Own
Growing your own food has to be one of the most rewarding experiences and all that time spent digging and harvesting your crop in the open air will keep you hale and hearty. Gardeners World will be top of your viewing schedule as you hang on Monty Dons every word about how to care for your seedling potatoes, runner beans and carrots. Find out more at The National Allotment Society.
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How Much Money Will You Need For Retirement
In short, a lot probably more than youre expecting.
As we saw above, many factors affect how much youll ultimately need to save for retirement, such as your retirement goals, expected living expenses, and your retirement age. For now, if you want to get a rough estimate for your retirement planning, you can use the following methods.
Retirement Can Be Tough On Couples
“Retirement is a major life transition, and you have to be patient with yourself and your spouse, says Patti Black, a certified financial planner in Birmingham, Alabama. Most retired couples do not look like those pictured in ads and commercials. You’ll have to decide how work around the house will change. Will you really share cooking, cleaning and yard work? And do you honestly want to be together 24-7, particularly if you downsize to a smaller home?
These decisions can have serious consequences for a marriage. Gray divorce, or divorce after age 50, has doubled since 1990 while declining across all other age groups, Black warns. And it is most often the wife who asks for divorce after age 50.”
John Waggoner covers all things financial for AARP, from budgeting and taxes to retirement planning and Social Security. Previously he was a reporter forKiplinger’s Personal FinanceandUSA Todayand has written books on investing and the 2008 financial crisis. Waggoner’sUSA Todayinvesting column ran in dozens of newspapers for 25 years.
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How Does Inflation Impact Your Pension
When youre planning for retirement, you need to take into account the impact of inflation, which is the general increase in prices and fall in the purchasing value of money.
In other words, youll want to think about the rising cost of consumer goods and services in Canada 10, 20, 30+ years from now when you enter retirement age.
The average rate of inflation in Canada recently has been 2% per year, which means that the cost of goods and services has been rising by 2% every year. This number is calculated by using what is called the consumer price index , which tracks the pricing changes of a broad range of over 600 consumer goods.
Think About Social Security
How big of a role can you expect Social Security to play in your retirement finances? That answer depends on lots of factors youll need to consider. For starters, many experts predict that youll need about 70% to 85% of your pre-retirement income to maintain your current lifestyle through retirement but for many people, Social Security may only provide about 40% of total retirement income needs.
One of the biggest decisions youll have to make about Social Security, then, is when to start collecting your benefits. There are several options available to you: You can 1) take a reduced benefit at 62, 2) wait until youre eligible to receive your full benefit , or 3) postpone your first payment to qualify for a larger amount. Just remember, the federal government requires that you start receiving your benefits no later than age 70, so theres no real benefit to waiting any longer than that.
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Know What Your Benefits Will Be
A little news that might shock those under 40. Theres no Retirement Money Fairy after all. Your parents just made her up to get you to relax about your future. Retirement money must instead come from two primary sources your savings and government benefits. That’s why it’s important to know how big of a gift you’re getting from the Canadian government.
There are some retirement benefits that most every Canadian will get, one that depends on how much youve personally paid into the system, and others that are need-based.
Old Age Security Pension is a stipend that can be had by most Canadians aged 65 or older and is not at all dependent on employment status or history. Got a pulse and a Canadian citizenship? Youre probably going to receive OAS at last check benefits were just over $600 a month. But if you earn too muchcurrently, over $128,137 per personthe government will take back every dime of it in the form of clawbacks, which in fancy government speak are known as the OAS recovery tax.
Canada Pension Plan is a government administered pension designed to benefit not only retirees, but also those who are disabled, and relatives of those who die after having paid into the CPP system. CPP benefits will be entirely dependent on how much youve contributed to the system over the years, though payroll taxes.
Tip #: Improve Your Daily Routine
A common habit among the most successful people is their daily routine, more specifically, their morning routine. There are killer tips from people like Mel Robbins, Tony Robbins, Tim Ferriss, and Chase Jarvis. Check these out:
- Mel Robbins Dont sleep next to your phone. Let your mind wander while you brush your teeth and ask yourself what 2 things you can do that day to make progress. Write those things down on a post-it and be sure to accomplish it during the day. Give yourself 30 minutes before 7:30am to focus on activities for you and only you.
- Tony Robbins Start with a breathing exercise. Express gratitude. Visualize connection in your body and then success. Exercise.
- Tim Ferriss Meditate for 20 minutes. Drink strong tea. Journal for 10 minutes. Eat a small breakfast and then exercise.
- Chase Jarvis Be sure to get enough sleep, as in eight hours. Drink water. Meditate. Practice and visualize gratitude. Eat a healthy breakfast and exercise.
The main takeaway is to clear out some time each day to allow yourself to focus on your inner self that allows you to live with intention. You need to allow your core values to come to life in your everyday reality. Instead of just dreaming about it, thinking about it and worse procrastinating on taking action.
Warning: if you decide to do nothing, or if you continue to do whats easy, you run the risk of:
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Assess If Your Plan Right Now Offers You A Secure Future
Once your plan is detailed enough, you will want to take a really hard look at whether or not you are all set. Is your future secure?
- When if ever do you run out of money?
- How balanced is your cash flow? Do your expenses exceed income?
- Are you tapping savings at an unsustainable level?
- How much savings do you have now? What will the value be of those savings next year and all the years thereafter?
- How much should you have saved now? What are the benchmarks for future years?
It is easy to get answers to all of these questions with the NewRetirement Planner.
E Have You Anticipated Any Other Potential Gotchas
We are covering a lot on this checklist for retirement planning, but you still need to be prepared for other gotchas expenses you might not have anticipated. You should also be prepared for give-yas unexpected windfalls.
Here are two considerations:
Have an Emergency Fund: A survey released by the Federal Reserve Board found that 47% of American consumers report they would not be able to come up with $400 for an emergency without borrowing or selling something. Thats half of the country living in a continual state of financial peril. You need to have readily available funds to use if your car breaks down, a family member needs help, natural disaster strikes or some other emergency arises.
Think Through Your Future Spending: Imagining your future in as much detail as possible can help you budget appropriately for retirement. A few things to consider:
- Will your kids graduate college and hopefully be on their own so your budget will be freer?
- Are you prepared to help your own parents with a long term care need?
- Will you receive an inheritance?
- Might you sell your vacation home at some point?
- Is there a possibility for divorce or remarriage?
- Are you ready for the death of a spouse?
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Taxes On Your Pension Withdrawal
One thing that hasnt changed in a long time in Canada, are the taxes surrounding your pension payout. When you take your pension out as a lump sum, there is a hefty tax hair cut and a significant amount will be immediately taxed, typically hundreds of thousands of dollars. This is primarily because of outdated Canadian legislation from 1990. Why is this bad? If you are terminated by your employer and the company youve been working at for many years abandons you, you likely dont want to leave your pension with that company and may want to take the cash to set up your own investment for your retirement. This outdated tax legislation penalizes you for doing that. Weve started a petition online to help change this. Sign it here.
You May Need To Make New Friends
If you retire in your 50s, you may find that your current friends aren’t around much because they still have full-time jobs. While you have the luxury of catching a matinee or playing a round of golf midweek, those in your social circle who are working nine-to-five don’t.
If you find new friends, they are likely to be older, says Dennis Nolte, a certified financial planner in Oviedo, Florida: Many of my pre-60-year-old retirees, especially those who are active, lament that their new peer group is significantly older than they are and thus have a different set of expectations about diet, sleep schedule, even cultural references.”
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A Do You Have The Right Asset Allocation
Depending on your financial situation, you may have very different asset allocation goals. Some people can live comfortably off income from their assets. Others can grow their net worth even after retirement. And, still others need to make withdrawals to make ends meet.
You need to make sure that your asset allocation strategy really meets your specific goals. Learn about creating an investment policy statement, or consider working with a financial advisor to help you position your savings to really maximize your wealth.
Research Your Family Tree
Wondering if youre descended from royalty , where your ancestors lived and what their occupations were? Now, thanks to a whole host of online resources such as Find My Past, researching your family tree is easier than ever. Check out census records, military records and search for globetrotting relatives from passenger lists. Who knows what youll uncover? You could also get your children and grandchildren involved as an ongoing family project. This is a great gift to offer to the family and generations to come will thank you for it.
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Get Back To Playing Music
Retirement can bring to the fore things you may have puttered around with for years but never had time to really concentrate on. Paul Hubert of Ashland, New Hampshire, used to play guitar in a band when he was young but let the skill slip as he made a living as a middle school music teacher. Now that he has retired, he’s back on the bar circuit, playing gigs all over New England, including every open mic night he can get to.
What Is Inflation And What Causes It
Over time, prices tend to go upwhich is called inflation. Because of inflation, how much you spend on everyday items changes from year to year, even if what you buy doesnt. And when costs go up, people and businesses cant buy as much as they could before.
Inflation can be caused by changes in supply, demand, and costs:
- When too many people want to buy something, demand increases, and prices go up.
- When theres not enough supply of something people or business want, theyre willing to pay more.
- When the cost of doing businesssuch as the price of raw materials or wagesgoes up, companies often pass along these increases to their customers.
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Make A Daily Schedule
If you start to feel bored in retirement, add a little structure back into your life! From establishing a bedtime and wake-up time to picking a weekday to visit your grandchildren, creating daily habits will make your days feel meaningful and focused. Adjusting to retirement can take some getting used to, but it will go a lot smoother if you develop a routine early on!
Finances Align With Your Plans
When youre planning for retirement, youre basically planning your retirement financially. To have enough savings to retire comfortably. But to thoroughly plan your retirement financially, you need to know how you want to plan life after retirement. If you want to do a lot of traveling, then you need to have a lot more savings then when you plan to do a lot of volunteer work in retirement.
So what Im trying to say is that your finances need to align with your plans after retirement. You want to avoid retiring with a head full of dreams and big plans without the money to do it. And therefore, its best to know what you want to do before you retire and have a financial plan that backs it up.
Perhaps, you come to the conclusion you need to work a couple of months or years longer to afford your dream in retirement. Does that dream weigh up to those extra months or years? Or maybe you desperately want to retire, and you choose to search for new and cheaper dreams in retirement. Either way, make sure both your retirement plans are aligned.
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Attend Your 35th 40th Or Any High School Reunion
There is nothing like a high school or college reunion to get you thinking about what you have accomplished and where you might be going.
Taking stock of our lives and setting new goals is exactly what we need to do as we consider retirement.
A reunion can be an excellent way to connect with old friends and maybe be reminded of what we are passionate about which can help remind us of how we might want to spend part of retirement.
The Commuted Value Option
Commuted value is the net present-day lump sum value of a future pension benefit. The total amount of your pensions commuted value is calculated using standards, as required under the Ontario Pension Benefits Act, and depends on many factors including future interest and mortality rates, and inflation.
When you retire, you have the choice of taking a lump sum payout of your pensions commuted value or a pension lifetime monthly benefit.
Your pension commuted value is not determined by investment returns on the pension plans assets.
Once you retire, or you are laid off by your employer, they will provide you with a pension statement that has the commuted value of your defined-benefit pension plan on it.
Depending on the company you work for and how long youve worked there, the commuted value of your pension could be 500k, 800k, or even 1 million dollars or more, so choosing how to manage that money is a critically important decision.
Youll be presented with a choice between:
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