When planning ahead for retirement most of us look to our financial needs and go to financial planners and in most cases have planned ahead financially for some time with investment plans.
As retirement looms closer we know we will have to live on a lower income than we are used to.
In Canada and The United States of America we are fortunate that we have the Canada Pension Plan as well as Old Age Security and in the U.
S.
we have Social Security.
These pensions do give us a basic income but in most cases it is not enough to maintain an acceptable standard of living.
In Canada the Old Age Security offers a supplement to provide you with income up to the poverty level.
Be aware that supplements from government are reduced by investment interest you may receive after retirement.
Also to qualify for a supplement you must have lived on a lower income for one income tax reporting year.
Then the supplement is considered and provided you are over 65 years of age and qualify you will then receive those extra dollars on a monthly basis.
Or you may obtain the supplement immediately by contacting the appropriate government office and give them the total of your projected income from your retirement date.
Failing to notify them will delay your supplement until after you have filed a lower year of income on your tax form.
If you take early retirement there are many benefits you will have to wait for until you become of age.
There are steps that you can take in advance of retirement that will reduce your need for the income you have been living on while employed.
If you have managed to pay off your mortgage and own your own home you may want to consider downsizing.
It is difficult to leave the home you have worked so hard to own but it can provide you with a retirement cushion.
In searching for a home to downsize to consider moving to a smaller community where housing costs are not as high as larger cities.
In most cases you can find a retirement community within 100 kilometers or 80 miles from where you now reside.
Look for a community that has provisions for an acceptable level of health care.
If you plan on living in your summer cottage which you have winterized consider the health care factor carefully.
Now you have planned to sell your home and create that financial cushion.
It is also important to have a newer vehicle paid for by your retirement date so you may need to acquire such a vehicle a few years in advance to have it paid off in time.
Make sure you have no credit card debt and after retirement do not put any amount on your credit card that you can not clear by the end of the month when payment is due.
If you must use credit for an unexpected expense a line of credit on your bank account has lower interest rates than do credit cards.
But of course this is why you have your financial cushion to take care of these unexpected expenses.
You will be glad you downsized.
Most of us cannot afford to remain in our pre-retirement homes.
Saving via real estate is one of your best investment opportunities to acquire retirement cushions.
When looking for a retirement home consider moving to a senior's community such as a 45 plus restricted age requirement.
Some choose mobile or modular home parks, some choose townhouse complexes and some prefer the individual rancher concept.
If any of these are in your plans then be aware that the size of your dog may restrict your choice.
Most of these communities insist your dog be under 18 inches in height.
It varies but small is the key word here.
So 5 years before retirement do not acquire a large dog unless you know you will not find yourself in this predicament.
One last point, remember is be sure to set your retirement date for the last day of the month.
Do not finish out a week if it leads you into the next month or you will have to wait an extra month for your government pension to begin.
And don't forget to contact your government pension plan and give them your retirement date 6 months to a year in advance.
It takes time to process your pension so they will be as prepared as you are!
As retirement looms closer we know we will have to live on a lower income than we are used to.
In Canada and The United States of America we are fortunate that we have the Canada Pension Plan as well as Old Age Security and in the U.
S.
we have Social Security.
These pensions do give us a basic income but in most cases it is not enough to maintain an acceptable standard of living.
In Canada the Old Age Security offers a supplement to provide you with income up to the poverty level.
Be aware that supplements from government are reduced by investment interest you may receive after retirement.
Also to qualify for a supplement you must have lived on a lower income for one income tax reporting year.
Then the supplement is considered and provided you are over 65 years of age and qualify you will then receive those extra dollars on a monthly basis.
Or you may obtain the supplement immediately by contacting the appropriate government office and give them the total of your projected income from your retirement date.
Failing to notify them will delay your supplement until after you have filed a lower year of income on your tax form.
If you take early retirement there are many benefits you will have to wait for until you become of age.
There are steps that you can take in advance of retirement that will reduce your need for the income you have been living on while employed.
If you have managed to pay off your mortgage and own your own home you may want to consider downsizing.
It is difficult to leave the home you have worked so hard to own but it can provide you with a retirement cushion.
In searching for a home to downsize to consider moving to a smaller community where housing costs are not as high as larger cities.
In most cases you can find a retirement community within 100 kilometers or 80 miles from where you now reside.
Look for a community that has provisions for an acceptable level of health care.
If you plan on living in your summer cottage which you have winterized consider the health care factor carefully.
Now you have planned to sell your home and create that financial cushion.
It is also important to have a newer vehicle paid for by your retirement date so you may need to acquire such a vehicle a few years in advance to have it paid off in time.
Make sure you have no credit card debt and after retirement do not put any amount on your credit card that you can not clear by the end of the month when payment is due.
If you must use credit for an unexpected expense a line of credit on your bank account has lower interest rates than do credit cards.
But of course this is why you have your financial cushion to take care of these unexpected expenses.
You will be glad you downsized.
Most of us cannot afford to remain in our pre-retirement homes.
Saving via real estate is one of your best investment opportunities to acquire retirement cushions.
When looking for a retirement home consider moving to a senior's community such as a 45 plus restricted age requirement.
Some choose mobile or modular home parks, some choose townhouse complexes and some prefer the individual rancher concept.
If any of these are in your plans then be aware that the size of your dog may restrict your choice.
Most of these communities insist your dog be under 18 inches in height.
It varies but small is the key word here.
So 5 years before retirement do not acquire a large dog unless you know you will not find yourself in this predicament.
One last point, remember is be sure to set your retirement date for the last day of the month.
Do not finish out a week if it leads you into the next month or you will have to wait an extra month for your government pension to begin.
And don't forget to contact your government pension plan and give them your retirement date 6 months to a year in advance.
It takes time to process your pension so they will be as prepared as you are!