Go to Admin » Appearance » Widgets » and move Gabfire Widget: Social into that MastheadOverlay zone
Record levels of debt and a sense of entitlement have left many with a retirement income gap they’re scrambling to fill. But there is still time for YOU to do it differently. And just because there’s confusion now doesn’t mean you have to walk the same path.
It has been estimated that four in 10 Canadians will retire with debt. I’m willing to bet, based on how delusional I’ve found people to be, that the number is much, much higher. Another survey reported that 62 per cent of people plan to retire with a pile of debt hanging over their heads. That’s a little more in line with my thinking.
Article Continued Below
The lesson: Your balance sheet must balance.
We used to aim to have our mortgages paid off by the time we swapped paycheques for retirement income.
It seems more than half of us think retiring with a mortgage is now OK. Is that because we don’t have a hope in hell of getting it paid off and we’re reconciled to being old and poor? If you’re living on less income, doesn’t having fewer fixed expenses just make sense?
Can’t live within your means while you’re working? How are you going to on a fixed income that’s less?
Credit cards and lines of credit have made living beyond our means easy. Since most retirement income is predicated on receiving 30-50 per cent less income, shouldn’t a body practise living on less so they can learn to be happy with what they have?
The lesson: You’re going to have a lot of demands on your money over your lifetime: retirement savings, educational savings for your kids, mortgage repayment. You have to prioritize saving over spending if you’re going to meet your goals.
Learning to be happy with what 50-70 per cent of your net income can buy means when you transition into retirement you won’t be assaulted by the concepts of frugality. And in the meantime, saving aggressively and paying off your mortgage means you’ll have more financial security.
The Big Lesson: Don’t make the same mistakes your parents did. Surely you’re smarter than that!