During the last market downturn, retirees who had all their assets in equities saw their nest egg shrink dramatically over a 12 month period. This is an absolute nightmare scenario for a retiree, and unfortunately, it was a reality for too many hard-working people.
Proper asset allocation is critical for a successful long-term financial strategy and it is especially important for retirees.
As a general rule, it is unwise for a retired to have 100% of their assets in equities at any time. But figuring out what that percentage should be takes a lot of personal investigation into each person’s risk tolerance and investment objectives.
During retirement, income needs can become pressing.
Can you generate sufficient income without drawing down on your principal? What is the best way to generate income without taking excessive risks?
RRIF
A Registered Retirement Income Fund is an investment plan, established in accordance with Government of Canada requirements, into which you can transfer….
GIC
Guaranteed Investment Certificates are issued in your name and can’t be sold except to the institution that issued them. You agree to keep the money in the GIC for a…
LIF
A Life Income Fund (LIF) is a retirement income plan using locked-in pension money and the owner of the LIF can control the investments held within the fund. In addition to…
TFSA
A Tax-Free Savings Account is a registered savings account that allows taxpayers to earn investment income tax-free inside the account. Contributions to the account are…
LIRA
The Locked-In Retirement Account (LIRA) and Locked-In Retirement Savings Plan (LRSP) enable you, as an employee to maintain the tax-deferred status of pension…
Segregated Funds
Guaranteed Investment Funds (also known as “Segregated Funds” or “Individual Variable Insurance Contract”) are basically enhanced Mutual Funds. They come with a…
Annuities
Annuities are one of the simplest investment vehicles one could acquire. Simply put, when you establish an annuity, you are purchasing a lifetime income. Examples of annuities…
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