{"id":775208,"date":"2026-09-18T23:46:10","date_gmt":"2026-09-18T23:46:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/775208\/"},"modified":"2026-09-18T23:46:10","modified_gmt":"2026-09-18T23:46:10","slug":"can-moira-57-retire-in-three-years-and-still-leave-an-inheritance-for-her-kids","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/775208\/","title":{"rendered":"Can Moira, 57, retire in three years and still leave an inheritance for her kids?"},"content":{"rendered":"

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

Moira wants to retire by the time she is 60, but Matt wants her to hang up her hat now.Nicole Osborne\/The Globe and Mail<\/p>\n

Matt is 62 and retired, living on dividends, capital gains and interest income. His wife, Moira, is 57 and working as an administrative assistant for the municipal government.<\/p>\n

They have three children, all in their 20s, and a mortgage-free home in an Ontario university town.<\/p>\n

Moira wants to retire by the time she is 60, but Matt wants her to hang up her hat now. She will be entitled to a small defined benefit pension when she retires.<\/p>\n

Their goals are modest: buy a late-model used vehicle, hire help with the lawn and snow removal, get some help around the house, travel more, update the kitchen, spend a winter or two in a warmer climate and \u201cleave a large cash nest-egg for each child upon our death.\u201d<\/p>\n

Their assets, including their house, total about $2.6-million.<\/p>\n

\u201cWhat are the financial pros and cons in Moira retiring now, at 60 or at 65?\u201d Matt asks in an e-mail.<\/p>\n

\u201cWe live frugally now. Do we have enough to live less frugally for the next 10-plus years while still having a sizable inheritance for the kids?\u201d<\/p>\n

Can Neetu retire before 65 and still give her daughter a big inheritance?<\/a><\/p>\n

Their retirement spending target is $90,000 a year after tax, rising in line with inflation.<\/p>\n

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

What the expert says<\/p>\n

For Matt and Moira, having a comfortable and secure retirement is their primary financial goal, Mr. Calvert says. <\/p>\n

They have a net worth of $2,615,000, excluding the assets in their registered education savings plan. <\/p>\n

Their house is valued at $550,000 and they have $5,000 in cash, $254,000 in combined tax-free savings accounts, $429,000 in combined RRSP assets and $1,377,000 in a nonregistered investment portfolio. Moira also has a defined benefit pension that will pay her about $6,000 annually when she is age 60. <\/p>\n

Over the next three years, they shouldn\u2019t plan to add any substantial savings to their portfolio based on their income and expenses, the planner says. Their lifestyle needs are being funded by Moira\u2019s employment income of about $51,000 a year and the annual investment income from their nonregistered portfolio.<\/p>\n

If Moira retires at age 60, they will have a cash flow deficiency given the size of her pension, he says. They haven\u2019t started their Canada Pension Plan or Old Age Security benefits.<\/p>\n

In 2030, the first year in which Moira will be fully retired, Matt and Moira should convert both their RRSPs to registered retirement income funds (RRIFs). If Matt takes the annual minimum RRIF withdrawal, it will be about $6,600 a year. Moira will only be reporting her pension income because the nonregistered portfolio is held by Matt. So she has the ability to take additional taxable income from her RRIF. \u201cIncreasing the withdrawal to $20,000 annually would be advantageous,\u201d Mr. Calvert says. <\/p>\n

There is a still a significant gap that needs to be filled by the nonregistered portfolio, the planner says. \u201cThis account represents the majority of their assets and will be the most important component of their retirement plan.\u201d<\/p>\n

Is it realistic for Ferdinand, 51, and Alice, 50, to retire in a few years?<\/a><\/p>\n

If Matt takes both his CPP and OAS at age 65, an expected combined value of $21,000 a year, they will need about $47,000 from the nonregistered account. This represents about 3.4 per cent of the projected nonregistered assets.<\/p>\n

In addition to the $47,000, they should take $14,000 a year to add to their TFSAs, making the total nonregistered portfolio withdrawal closer to $61,000. <\/p>\n

Their 2030 cash flow would then be $21,000 from Matt\u2019s CPP and OAS, $26,600 from their RRIF accounts, $6,100 from Moira\u2019s pension and $47,000 from the nonregistered portfolio, for gross income of about $101,000 a year. Subtracting expected taxes payable of $9,500 would give them an after-tax income of $91,500. <\/p>\n

At this rate of withdrawal from Moira\u2019s RRIF, the account is expected to be depleted in 2036, when she is 67. At that time, she could consider starting her CPP and OAS to fill the gap, or increasing the withdrawals from their investment portfolio until she starts government benefits at age 70.<\/p>\n

Matt could also consider deferring his CPP and OAS to age 70. <\/p>\n

In this scenario, the nonregistered funds would need to make up the difference for five years of their retirement plan, Mr. Calvert says. Their total taxes payable would be reduced, but their nonregistered withdrawals would need to increase to about $63,000 a year, or about 4.5 per cent of the account. <\/p>\n

\u201cThis remains a healthy withdrawal rate,\u201d the planner says. It supports the idea of delaying Matt\u2019s government benefits, which would then be enhanced and provide a higher guaranteed, indexed retirement income for the rest of their lives. <\/p>\n

If they can achieve on average a 5-per-cent rate of return, this would be an optimal withdrawal plan, he says. In the long run, their RRIFs are depleted, their TFSAs are built up and their nonregistered portfolio is preserved. \u201cNot only is their capital maintained, but they now have a very tax efficient net worth for the transition to their children.\u201d <\/p>\n

In either option, the portfolio and risk management of the nonregistered portfolio will be very important and require careful planning, he says. <\/p>\n

To reduce this risk, Matt should ensure he builds his portfolio structure with a strong cash flow yield without missing out on future growth. <\/p>\n

\u201cAiming for a portfolio yield of about 4 per cent would be a great place to start.\u201d The 4-per-cent yield plus any growth would be their total return.<\/p>\n

Can Luther, 52, and Bethany, 49, retire in a few years and still leave a big inheritance?<\/a><\/p>\n

When investing in stocks and stock funds over a long retirement period, there will undoubtedly be periods of volatility and pullbacks in stocks, Mr. Calvert says. \u201cIt is not about trying to predict the next correction, it\u2019s about building a portfolio that doesn\u2019t force you to sell stocks during a downturn,\u201d he says. \u201cIf most of the withdrawals can be funded by incoming cash flow, it will allow Matt and Moira to manage future volatility by keeping their capital intact.\u201d <\/p>\n

Owning Canadian dividend stocks can be a \u201cgreat component\u201d to this portfolio because Matt and Moira can obtain strong and stable dividend yields and a favourable tax treatment. However, to be truly diversified, they need to own investments outside of Canada to give them exposure to important sectors not heavily represented in the Canadian market, the planner says. <\/p>\n

Client situation<\/p>\n

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

The people: Matt, 62, Moira, 57, and their three children, 22, 24 and 26.<\/p>\n

The problem: When can Moira afford to retire and still meet all their retirement and estate planning goals?<\/p>\n

The plan: Moira works to age 60. They both convert their RRSPs to RRIFs and begin withdrawing. <\/p>\n

The payoff: A carefully planned retirement taking into account the importance of a stable investment income.<\/p>\n

Monthly after-tax income: Variable because of reliance on investment income.<\/p>\n

Assets: Cash $5,000; nonregistered investment portfolio $1,377,107; his RRSP $236,715; her RRSP $192,660; his TFSA $141,068; her TFSA $112,635; RESP $72,335; residence $550,000. Total: $2.6-million.<\/p>\n

Monthly outlays: Property tax $420; home insurance $165; electricity $190; heating $90; maintenance $165; garden $75; transportation $630; groceries $935; clothing $75; gifts, charity $220; vacation, travel $105; other discretionary $340; dining, drinks, entertainment $555; personal care $20; club memberships $30; pets $70; sports, hobbies $200; subscriptions $35; other personal $15; health care $175; communications $140; RRSPs $615; TFSAs $500; her pension plan contributions $380. Total: $6,145.<\/p>\n

Liabilities: None.<\/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: Moira wants to retire by the time she is 60, but Matt wants…\n","protected":false},"author":2,"featured_media":775209,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[84,4176,15906,4174,4175,56,54,55],"class_list":["post-775208","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-finance","tag-financialfacelift","tag-personal-finance","tag-personalfinance","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/775208","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=775208"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/775208\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/775209"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=775208"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=775208"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=775208"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}