Globe Advisor’s Best of 2022: Retirement Planning Strategies to Consider

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Although financial advisors help their clients plan and prepare for various important life events and milestones, none are as central as retirement.

But while it’s essential for advisors to ensure that clients have enough assets to produce the income they need for the rest of their lives, there are many other factors that both parties need to consider – financial and nope.

Here are 10 articles on retirement planning strategies and related issues that caught the attention of Globe Advisor readers in 2022:

Don’t let big bad math ruin your CPP benefits

Neil Gross, president of Component Strategies in Toronto, says nowhere is the vile nature of math more evident than in the alluring proposition she makes to all Canadians on their 65th birthday: Defer the payment of Canada Pension Plan (CPP) benefits to age 70 and get you 42% more money every month. He closely examines whether this tempting arrangement is real.

Does the 4% rule for retirement income withdrawals still apply in today’s market?

Rising inflation and the combination of falling stocks and bonds over the past year have caused many investors to reconsider the reliability of the “4% rule” as a guideline for how much to withdraw annually from their wallets. A recent study says the rule is “proving woefully inadequate for current retirees”. Specifically, the report says a retired couple face a 17.4% chance of “financial ruin” or outliving their money, using the 4% rule.

Debate intensifies over two retirement plans for business owners and whether they really are different

The personal pension plan (PPP) has been marketed over the past decade as a superior alternative to the more common individual pension plan, but some industry insiders warn that the sole provider of the PPP is luring customers with claims of additional key features, which they say are of little value, to justify the product’s much higher cost.

Why having enough money is just one piece of the retirement puzzle

In recent decades, the typical retirement has been portrayed as the end of people’s working days and the start of their golden years – a well-deserved, fun time with family and friends. Yet Alexandra Horwood of Richardson Wealth Ltd. in Toronto writes that factors such as divorce, market downturns, unexpected serious illnesses, layoffs and restructuring, as well as the unexpected loss of business partners, family members or friends, can affect clients on the road to retirement and get them to review old plans or formulate new ones.

What to consider before returning to Canada to retire

A desire to live closer to family, lifestyle reasons, or concerns about future health care costs have led many expatriate professionals who have built their careers in other countries to choose to return to Canada to their retirement years. But for returning retirees who have accumulated assets elsewhere, returning home can be complex, advisers say. They can benefit from advanced and personalized planning based on investments, taxes and the cost of living.

What happens when retirees can’t sell their homes?

For some retiring clients, the recent downturn in the housing market – both in terms of lower prices and lower sales activity – is affecting long-standing plans to sell their primary residence and free up cash at the time of their retirement. As they consider their next moves, many are looking to their advisers to help them adjust their expectations and to help them implement new solutions to lessen the impact of the setback. They also want clarification on how best to proceed.

Guardian launches ‘modern tontine’ for retirement planning

Canadians approaching retirement age have a new type of investment product that mimics some aspects of defined benefit annuities and pension plans and could grow in popularity as people live longer. Tontines, which have existed for centuries as ‘last person’ investment pools in which surviving members inherit the assets of deceased members, have arrived in a modernized format from Guardian Capital LP as three new mutual funds of GuardPath Longevity Solutions brand placement.

How advisors can help their clients plan for retirement beyond finances

Advisors need to do more than ensure their clients are prepared for the non-financial aspects of retirement, as most retirees find it difficult to adjust to this phase of their lives. Specifically, advisors have a key role to play in helping clients clarify how they want to spend their golden years. Globe Advisor Editor Pablo Fuchs talks to Susan Latremoille, former wealth advisor and co-founder of Next Chapter Lifestyle Advisors, about how advisors can guide their clients in planning for a successful and happy retirement.

Demand for annuities expected to rise as investors eye larger payouts

With higher interest rates allowing insurers to offer larger payouts on their annuity products, combined with a growing number of baby boomers reaching retirement age, advisors expect the demand for pensions is accelerating further. “It’s a very favorable environment for annuities, and I anticipate an increase in this type of activity,” says Joseph Trozzo, vice president of investment sales at Equitable Life of Canada in Vaughan, Ont.

How reverse mortgages factor into retirement planning amid rising interest rates

Reverse mortgages are proving to be an increasingly popular retirement planning tool, even though interest rates have risen and these products command higher rates than most other mortgages. Specifically, advisors are turning to reverse mortgages as a way for clients looking to delay Old Age Security and Canada Pension Plan benefits, access more tax deductions, or help put a down payment on their children’s homes.

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