RRSP Calculator Forecasts Retirement Income Needs

With an RRSP calculator you can consider your retirement income needs from a monthly perspective, not an annual figure or lump sum dollar amount as commonly used in the financial planning industry, a new study finds.

Advisors have traditionally worked with clients towards a yearly income stream goal,” Recent research has revealed that this approach using tools such as an RRSP calculator could help individuals looks at their income stream from a monthly perspective.

According to a recent BMO Retirement Trends Study, 66% of respondents who have a dollar figure in mind for retirement needs consider retirement income from a monthly perspective.

Clearly using a tool such as an RRSP Calculator helps in the planning process

With only a quarter of those who have a dollar figure in mind for retirement needs (24%) consider retirement funding from an annual income stream perspective, with $54,700 a year as the average.

A very small proportion (8%) had a lump sum in mind, with $649,500 as the average amount. Using retirement saving plan calculators to break down retirement income into monthly bundles is ultimately a much more practical and tangible way for pre-retirees and retirees to conceptualize how they’re going to fund their lifestyle in retirement.

The study also illustrates that the 45-and-older cohort is not a homogenous group. There is a segment that feels prepared, optimistic and ambitious about the next stage of their life.

The other group feels they may not be as prepared and need to make some adjustments, such as a longer transition period between work and ‘active retirement’.

These results truly reinforce the fact that retirement and retirement calculations are changing, and as advisors we continue to change with it.

Retirement is no longer a hard stop, where we shift from getting a pay cheque to getting a pension cheque or drawing from a lump sum investment. It’s often a transition between full-time work and an active retirement.

To provide a customized snapshot of what that transition stage could look like first start by taking a Successful Wealth Approach but to get started and to have an idea of potential retirement income try out this RRSP Calculator



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