Life after work

Source: Brantford Expositor (Port Dover)

   By Guest Blogger Ryan Lewenza

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When can I retire? How much do I need in retirement? Will inflation surge and eat away at my savings? Will Trump’s tariff policies lead to a recession and a market meltdown? These are just some of the common questions/concerns we hear from clients around retirement.

Retirement marks a major life transition, bringing with it a wide range of important considerations. To ensure a successful and fulfilling retirement, it’s essential to address these key issues – today we’ll explore some of the most critical ones.

One good resource on retirement is Fidelity’s annual retirement report, which they have published for two decades. The report is based on a comprehensive survey of over 2,000 Canadians, with respondents answering questions on a range of retirement related topics.

This year’s report starts off with one of the most fundamental and important questions around retirement – how much household income do you need in retirement and therefore how much savings will you need to support the yearly retirement income?

Those pre-retirees surveyed said they would need $93,300 in pretax household income to provide a comfortable retirement. This is up materially from their 2005 retirement survey when respondents said they needed $52,800. Even adjusting for inflation (2005’s estimate adjusted for inflation equates to $81,000), Canadians believe they need even more annual income to have a good retirement.

Before taxes, what will be the amount of annual household income you need to be comfortable in retirement?

Source: 2025 Fidelity Retirement Report

Next, they asked how much do Canadians need to save for a comfortable retirement. They note that the average government transfers to retired Canadians (CPP, QPP and OAS) is $36,500/year. So, subtracting that from the $93,300 Canadians believe they need in income, results in a difference of $56,800 of income that will need to come from their investments and other sources.

Other sources of income could include rental income, employer pensions, investments and even income from a part-time job. Roughly one in five seniors (65 to 74) work in retirement, so this is becoming much more common.

Below is an interesting chart from the report, which shows, based on various withdrawal rates, how much savings one will need to provide that income of $56,800. Using a lower 4% withdrawal rate, a portfolio would have to be around $1.4 million to provide that annual income. At a higher 5% withdrawal rate, the portfolio would need to be around $1.13 million. Final observation from this chart is that those survey believed they would need $1 million in retirement to provide that income, so these numbers show that the average retired Canadian needs more savings and investments then they think.

Because individual expenses and spending habits vary widely, financial planning is never a one-size-fits-all endeavor. But this Fidelity report found Canadians believe they need over $93,000 in annual income with a portfolio size above $1 million. Where do you stack up against these metrics?

How much do Canadians need to save for a comfortable retirement?

Source: 2025 Fidelity Retirement Report

We’ve been fielding a lot of calls and questions around President Trump and his tariff policies. Some, understandably, are worried over the impacts of his chaotic and haphazard tariff policies, particularly from our Canadian clients, since he seems hellbent on trashing our economy.

Fidelity found this as well, with many of the survey respondents worried about our economy and the political turmoil (i.e., Trump). The survey found over 80% of pre retirees and retirees are concerned about rising inflation. And 68% are worried about the current turmoil in world politics.

What Canadians are worried about with respect to their retirement

Source: 2025 Fidelity Retirement Report

Maybe stating the obvious, but there’s a lot to worry about these days including multiple macroeconomic issues, heightened geopolitical uncertainty, wars etc. But one thing we found, and was confirmed in the Fidelity report, is that having a detailed financial plan can go a long way in addressing these concerns.

The survey asked respondents how prepared they are for retirement, and whether they had completed a financial plan. The findings were stark. Only 39% of pre retirees feel prepared for retirement for those that didn’t have a financial plan versus 81% of pre retirees who had a financial plan.

We couldn’t agree more, which is why we offer plans to all our clients as they approach or are in retirement. The plan is the roadmap to retirement and greatly helps to visualize and plan out your retirement. The plan is key as the survey found.

How well prepared for retirement do you feel you are?

Source: 2025 Fidelity Retirement Report

Finally, I like to say there are two key aspects to a successful retirement – the financials including having the required savings and financial plan in place and having a plan of how you’re going to fill the time. Yes, the dollars and cents are key but almost overlooked in all this is what you plan to do in retirement.

We spend roughly 90,000 hours or 30% of our lives working. Once we retire, we have 7-8 hours per day of additional time that we need to fill up. So, you better think and plan for this, as all the money in the world won’t address this critical aspect of retirement. Traveling, spending time with friends and family (maybe helping out with those rambunctious grandkids), physical activities like golf, working out and pickleball, and contributing time to your local charities and church.

Retirement takes a lot of planning and hard work, so get cracking as the more work you put in now, the more prepared you’ll be for that day, and isn’t that what were really all working towards. Garth, excluded. He’s a work nut!

Ryan Lewenza, CFA, CMT is a Partner and Portfolio Manager with Turner Investments, and a Senior Investment Advisor, Private Client Group, of Raymond James Ltd.

Source: https://www.greaterfool.ca/2025/08/09/life-after-work/