I\u2019m 58 and have been on my own for the past 14 years. My ex has been giving me a limited amount of alimony. I\u2019ve tried to save but I only have approximately $230,000. I feel I need at least $1-million to retire comfortably. My youngest child is still living at home. I\u2019m looking for more saving strategies.<\/p>\n
We asked Howard Kabot, CFP, vice-president of financial planning and family office services at RBC Wealth Management Canada, to answer this one.<\/p>\n
The first question to ask yourself, according to Mr. Kabot, is: why do you feel you need $1-million?<\/p>\n
\u201cHave you \u2018crunched\u2019 the numbers? If not, then you must do this first before you can understand how much you\u2019ll need to retire comfortably,\u201d he said. <\/p>\n
This next set of questions will help you come up with the answer. <\/p>\n
How much do you think you will need on an annual basis? Will you be eligible for Canada Pension Plan payments? If you are, Mr. Kabot noted that at age 65 monthly CPP in 2026 can be as high as $1,507. He also pointed out that at age 65 you will be eligible for Old Age Security. In 2026, the monthly OAS amount will be $740 for Canadians aged 65 to 74. Combined, he calculated that the two benefits could account for $27,000 of annual income. Then there\u2019s the income from alimony.<\/p>\n
Mr. Kabot suggested exploring options that will help you continue to save. \u201cYou\u2019re 58 years of age. Since you\u2019ve asked for more savings strategies, I\u2019ll assume you\u2019re able to save at some level,\u201d he said. \u201cIf you\u2019re working, then you can contribute to a registered retirement savings plan. The advantage of contributing to an RRSP versus a regular savings or bank account is twofold: The funds in an RRSP will grow on a tax-deferred basis, and you will get a tax refund based on the contribution made into the account.\u201d <\/p>\n