Retirement planning: The question you need to ask yourself - MoneySense

Retirement planning: The question you need to ask yourself

There’s a huge advertising push to contribute to your RRSP. Before you contribute, ask yourself this question.



What’s with the relentless marketing of RRSP season? It makes Walmart’s Christmas advertising look like a poster for a vegan bake sale. Enough already. What can I do to make it stop?


Didn’t you hear? RRSP season has been named an official holiday by Hallmark. Products in development include greeting cards, decorations and battery-operated financial adviser dolls singing inspiring tunes like ‘Don’t spend your 70s selling pencils in the street’ You can’t beat ‘em, so here’s how to join ‘em. Answer this hugely important question: How do you want to spend your retirement?

What? THAT is the single most important question? Yep. It is the one key question that drives everything when it comes to retirement planning. And yet most people don’t have an answer for it.

You don’t need to have tee times in your calendar, but it does make a big difference to have some sense of what you want to be doing when you’re no longer drawing a paycheque.

Why? Because this question will help you figure out how much you’re going to need to save now to do what you want to do then. Playing “Angry Birds” (2032 version) with the grandkids is going to cost way less than travelling the world in search of real birds to watch.

Second reason? Having a sense of what you want your retirement to look like gives you some motivation to work on it. That is one of the reasons the marketing is bloody loud every winter. Way too few people are planning for retirement. Part of the problem is that the topic itself is more boring than Mitt Romney, and part of it is because retirement seems so unreal and so far away.

So ask yourself, how do you want to spend your retirement? Where will you live, city or country, house or condo. What will you do, volunteer locally or tour the seven wonders of the world. And at what age do you want this silliness to start?

Don’t worry if you can’t figure it out, or if it changes completely in a month or a year. The point is that you’ve started thinking about retirement in a real way. And when something is real, it is way easier to plan for it. Oh, and if you’re looking for something to get your spouse to celebrate RRSP season…forget fancy. A simple lump sum payment into his or her RRSP is always a winner.