Boomers And Their Finances Money Matters

If you had the privilege of attending the Timeless Women, Pro-Age and Panache event recently, the underlying message was to take time for you. This is also a recurring theme for the Baby Boomers, as the first wave gets ready to retire.

With Canadian Boomers now comprising 44 percent of the population, and with more than half of those being women, the majority will be heading into retirement in 10 to 15 years.

Generally women live longer than men and with technological advances in health, there is a good chance that one of two people in a couple will make it to age 92 or older.

This means retirement will last for thirty years or more. So what are you going to do for the next 30 years? And the bigger question is how much money will it take to do it?

Many traditional retirement strategies that were used by previous generations will be tested over the next few years. With the possibility of 30 years of retirement to fund, it may not make sense to shift from stocks to bonds as you near retirement, or that you should eliminate all of your equity holdings.

Since most Boomers have not been great savers, they are only now realizing that they need a plan. Previous generations had several children they could rely on for support , however since the baby-boomers chose to have fewer children, they will have fewer children to rely on when they get older.

Additionally, boomers have not had a single employer for their working lives, but have worked for many companies. Because of this, most do not have a defined benefit pension plan that guarantees a level of income for the rest of their lives. There is uncertainty regarding the availability of Old Age Security payments and timing of CPP payments in the future. As well, the most recent equity market downturn has left boomers concerned. Many may need or want to work longer than the traditional retirement age and to save more aggressively to fund their retirement income.

Most likely Boomers will need different financial resources for different stages of retirement. The first 5 to 10 years after age 65, will generally be filled with enjoying all the things that were put off, such as travelling, spending time with family and taking courses. Another big issue will be assisting elderly parents and helping grown children at the same time. Some may even decide to work longer and transition into retirement, with some making other life altering decisions such as deciding to divorce. Generally the most demands on financial resources will be in these years.

The next 5 to 10 years will most likely be less demanding, as elder parents may have passed, children have married and moved out, you may have downsized your home, health may not allow travel as far away, and you may have moved to a retirement residence. Additional capital from an inheritance or from selling a home will balance out additional cash flow demands. There may be more opportunity for philanthropy and volunteering and giving back the community.

The final years will most likely be less active, with less of a drain on financial resources.
If you are a few years away from retirement, you owe it to yourself to find a financial professional, someone you trust, to help ensure your money does not run out before you do. There are still things you can do today that will increase the likelihood of your living well in retirement. It is never too late. Taking time for you and your finances now will ensure an enjoyable retirement on your terms.

Having financial freedom in retirement or at any age allows other freedoms, to enjoy your family and friends, to travel, to be rested, fresh and fully conscious, freedom to good in the world, freedom to use your time as you choose. This is your time...take time for you.

Heather Holjevac, BComm, CFP, CDFA
Wealth Coach 4U
Financial Planner and Wealth Coach
Cell: (416) 527-2553, Toll-Free: 1-877-341-8687
http://www.wealthcoach4u.com
"Committed to Your Financial Success"