Kathryn Olson
January 10, 2025
2025: Is this your year to retire?
It’s 2025 and that has many people making New Year’s resolutions. Some are focusing on getting healthy, while others are learning new skills. But what if your New Year’s resolution is to retire? How do you know if it’s the right time?
If you’re wondering if 2025 is the right time to retire, you’re probably looking at your savings and investment accounts and wondering if you’ve saved enough. You may be studying the economy and questioning whether your retirement can succeed in the current conditions. You may also be worried about recent political events. What impact will Trump’s election and Trudeau’s resignation have on Canada? On your retirement?
But retirement isn’t a political or an economic decision. It’s not even a financial decision. At its core, retirement is a lifestyle decision.
We have helped clients plan for retirement for many years, and we’ve found that while many people know how much money they’ve saved, very few have a clear picture of what that money can do for them.
How to create your vision for retirement
Having a clear picture of your retirement sounds great, but where do you begin? Start by answering these four questions:
- What’s on your bucket list? Maybe it’s taking that dream trip. Maybe it’s learning to fly a plane or sail a boat. Maybe it’s finally landscaping your backyard so that your family can spend more time there together.
- What do you want to accomplish? Retirement may signal the end of your career, but you don’t have to stop learning or growing. Consider learning a new skill, volunteering in your community, or becoming a mentor to someone who needs it.
- What do you want your day-to-day life to look like? Retirement isn’t just an extended vacation. Travel and golfing every day can get old. Think about how you actually want to spend your time. Think about who you want to spend it with.
- What do you want to pass on to the next generation? This can include money, properties, or even sentimental items that you plan to account for in your will. But it could also include family values or stories that you want to impart to your loved ones.
Take a moment to look back over your answers. Are your answers consistent with your values? Are they helping you focus in on what’s really important?
Once you’ve identified your goals for retirement, it’s time to start planning.
Planning to make your retirement goals a reality
Now that you have a vision for retirement, you’re ready to sit down with your advisor and figure out how to make it happen financially.
A good plan will not only give you an idea of whether or not your lifestyle goals are achievable, but it will also tell you what you need out of your portfolio to make it all happen.
This is where strategy comes in. How can you structure your portfolio to meet your goals? Our team does this with an investment strategy that designates groups of assets to achieve one of four main goals:
- Income: Providing the predictable, sustainable income you need to maintain your lifestyle;
- Growth: Growing your portfolio so you don’t have to worry about running out of money;
- Health: Ensuring that any unexpected healthcare costs are covered and your legal documents are in place;
- Legacy: If you have more wealth than you can use in your lifetime, planning how to transition that wealth to the next generation.
Structuring your investments to achieve these foundational goals, and having the discipline to stick to your strategy despite what your emotions are telling you to do, will set you up for success in the long run.
No financial plan should be set-it-and-forget-it
Your goals aren’t set in stone, so your financial plan shouldn’t be either. As your life changes - you want to live abroad or help your children buy their first home, you experience a health issue, or grandchildren are added into your family - your plan should evolve with you to keep you on track towards reaching your goals.
Your wealth advisor is there to make sure your financial situation is set up to support your life, not the other way around. So you should be meeting with him or her regularly to review your plan and make updates as needed.
So, if you’re ringing in this new year already feeling tired and wondering if 2025 is the year you finally retire, start thinking about what you want to get out of the experience and then talk to your advisor about how to achieve the lifestyle you’re envisioning.