{"id":600933,"date":"2026-08-22T06:30:18","date_gmt":"2026-08-22T06:30:18","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/600933\/"},"modified":"2026-08-22T06:30:18","modified_gmt":"2026-08-22T06:30:18","slug":"with-a-27-year-age-gap-how-can-sydney-retire-early-to-spend-time-with-his-partner","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/600933\/","title":{"rendered":"With a 27-year age gap, how can Sydney retire early to spend time with his partner?"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

Sydney would like to retire 10 years from now to spend more time with his soon-to-be retired partner, Darnell.Laura Proctor\/The Globe and Mail<\/p>\n

Sydney, who is 39, hopes to retire early to spend more time with his partner, Darnell, who is 66. <\/p>\n

Darnell is planning to retire by year-end. As well, they have a child who will turn 7 soon and they plan to pay for his higher education.<\/p>\n

Sydney earns $150,000 a year in the finance industry while Darnell earns $150,000 a year in communications. They share ownership of a house valued at $1.4-million with a mortgage of $382,000.<\/p>\n

Darnell has a defined-benefit pension that will pay $57,600 a year, indexed to inflation. He also has a $1.2-million registered retirement savings plan. Their retirement spending goal is $100,000 a year after tax, rising in line with inflation.<\/p>\n

Sydney asks whether he can afford to retire in 10 years or so \u201cto spend time with Darnell while he\u2019s young and able,\u201d he writes in an e-mail. What steps can they take to ensure they are well prepared financially?<\/p>\n

We asked Ian Calvert, head of wealth planning at HighView Financial Group in Oakville, Ont., to look at Darnell and Sydney\u2019s situation.<\/p>\n

What the expert says<\/p>\n

Darnell and Sydney have accumulated substantial investments, including about $400,000 each in their tax-free savings accounts \u2013 \u201ca great accomplishment,\u201d Mr. Calvert says.<\/p>\n

Darnell is retiring this fall and Sydney would like to retire 10 years from now. \u201cThey have a 27-year age difference, so Sydney\u2019s early retirement at 50 is their primary financial goal,\u201d the planner says.<\/p>\n

After Darnell retires, they will still be in a positive cash-flow position thanks to his pension and Sydney\u2019s income. With Sydney\u2019s income of $150,000 a year and Darnell\u2019s pension of $57,600 a year, they will have a gross family income of $207,600.<\/p>\n

This should give them enough cash flow after taxes to cover mortgage payments of $44,820 a year and their lifestyle expenses of $100,000.<\/p>\n

Although their expenses will be covered plus a small buffer, Darnell should think about a strategy for his $1.2-million in RRSP assets, the planner says. In any scenario, having the correct beneficiary in place is important. \u201cGiven the size of Darnell\u2019s RRSP and the big difference in age, Darnell should ensure Sydney is listed as the successor annuitant on the account.\u201d This will ensure the remaining RRSP assets can be transferred to Sydney on a tax-deferred basis when Darnell dies. \u201cWith the age gap and the size of Darnell\u2019s RRSP, there is a high probability these assets will be funding Sydney\u2019s retirement after Darnell dies,\u201d the planner says.<\/p>\n

How can Mandy, 64, and Syed, 65, make the most of their hard-earned savings in retirement?<\/a><\/p>\n

Darnell should consider getting a small head start on his RRSP withdrawals. The years between 2027 and 2031 will undoubtedly be the lowest-income years for Darnell. These are the years before he converts his RRSP to a registered retirement income fund and begins making mandatory minimum withdrawals at the age of 72.<\/p>\n

As well, his income will rise when he begins collecting government benefits at 70. \u201cAt age 72, his minimum RRIF withdrawal is projected to be $82,500 of taxable income,\u201d the planner says.<\/p>\n

Assuming Sydney is still working, there would be no benefit to Darnell splitting any income with Sydney through eligible pension splitting.<\/p>\n

From 2027 to 2031, Darnell\u2019s income is estimated to be about $60,000 a year between his pension and some small investment income. He could withdraw up to $30,000 from his RRSP in these years to have the funds taxed at a favourable rate, Mr. Calvert says. His marginal tax rate would be 29.65 per cent and his average tax rate would be about 19 per cent. \u201cHe could use the surplus funds to max out both TFSAs or comfortably add some additional expenses.\u201d<\/p>\n

This head start would also lower Darnell\u2019s minimum RRIF withdrawals at 72 to about $74,000.<\/p>\n

When Sydney retires in 2036, a few things will happen, the planner says. If they follow the same mortgage payment schedule, the mortgage would be eliminated in 2036, \u201cwhich is ideal timing with Sydney\u2019s retirement and the loss of his income,\u201d Mr. Calvert says.<\/p>\n

When he retires, Sydney should convert his RRSPs to a RRIF and his locked-in retirement account to a life income fund (LIF) and start minimum withdrawals, the planner says.<\/p>\n

\u201cIn their first year of being retired together, they will have combined gross income from all sources of about $219,600 with inflation,\u201d he says.<\/p>\n

This total income, less $46,000 in income taxes payable, will provide enough after-tax cash flow to meet their indexed lifestyle spending of about $126,000 a year.<\/p>\n

\u201cBased on this withdrawal plan, they could comfortably spend more and never worry about the longevity of their assets or Sydney\u2019s early retirement,\u201d Mr. Calvert says.<\/p>\n

Should Renata, 75, downsize and pay off her reverse mortgage to leave money for her sons?<\/a><\/p>\n

When Darnell is 90, they will have the future value of their real estate; his RRIF, projected to be $850,000; plus a combined $3-million in TFSA assets. That assumes they contribute $7,000 a year to their TFSAs and that they can achieve a 5-per-cent rate of return on average.<\/p>\n

They also asked about home renovations and car replacements over the years. These items would be one-time costs outside of their estimated general expenses. With the size of their TFSAs and their non-registered savings, the planner says, they shouldn\u2019t worry about these one-time or occasional big expenses because their investments are not required for their annual retirement cash-flow needs.<\/p>\n

\u201cIf possible, they should use their non-registered assets first for big expenses and preserve the TFSA assets, assuming they can raise the funds without incurring a large capital gain.\u201d<\/p>\n

Client situation<\/p>\n

(Income, expenses, assets and liabilities provided by the applicants.)<\/p>\n

The people: Sydney, 39, and Darnell, 66.<\/p>\n

The problem: How to position themselves so that Sydney can join Darnell in retirement. How best to draw down their savings.<\/p>\n

The plan: When Darnell retires later this year, he should draw down his RRSP first.<\/p>\n

The payoff: Not having to pay more tax than necessary.<\/p>\n

Monthly after-tax income: $18,000.<\/p>\n

Assets: Cash in bank $95,000; non-registered investments $145,000; Sydney\u2019s TFSA $402,000; Darnell\u2019s TFSA $400,000; Sydney\u2019s RRSP $420,000; Darnell\u2019s RRSP $1,200,000; Sydney\u2019s LIRA $85,000; Sydney\u2019s defined contribution plan $10,000; registered education savings plan $41,000; residence $1.4-million. Total: $4,198,000 <\/p>\n

Estimated present value of Darnell\u2019s defined-benefit pension: $760,000. That is what someone with no pension would have to save to generate the same retirement income.<\/p>\n

Monthly outlays: Mortgage $3,500; property tax $790; water, sewer, garbage $35; home insurance $85; electricity $120; heating $100; maintenance, garden $250; transportation $315; groceries $600; child care $500; clothing $100; gifts, charity $300; vacation, travel $600; other discretionary $100; dining, drinks, entertainment $700; personal care $30; club memberships $235; pets $200; sports, hobbies $50; subscriptions $50; other personal $50; health care $420; communications $210; RRSP $2,000; RESP $165; TFSAs $1,165. Total: $12,670<\/p>\n

Liabilities: Mortgage $382,000 at 4.05 per cent.<\/p>\n

Want a free financial facelift? E-mail finfacelift@pm.me<\/a>.<\/p>\n

Some details may be changed to protect the privacy of the people profiled.<\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: Sydney would like to retire 10 years from now to spend more time…\n","protected":false},"author":2,"featured_media":600934,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[72,176,2726,61,60,174,175],"class_list":["post-600933","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-finance","tag-financialfacelift","tag-ie","tag-ireland","tag-personal-finance","tag-personalfinance"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/600933","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=600933"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/600933\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/600934"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=600933"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=600933"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=600933"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}