Retirement one year later...........money

(I AM NOT A FINANCIAL EXPERT, PLEASE SEEK ADVISE OF A PROFESSIONAL, THIS IS WHAT HAS WORKED FOR US)

First up money.  

This is the major issue when retiring.  Will you or won't you have enough to live on; especially when you have no idea how long you are going to live.  Financial planners now use the age of 90 as your expected life expectancy.

You've worked all your life and have had a regular income.  Now you're relying on government pensions (if you're lucky) and what ever savings or private pensions you have been paying into.

We/I have been planning hubby's retirement for years.  I haven't worked in years, so we knew 95% of money in retirement was going to be coming in via hubby's income rather than mine.  We were okay with this.....obviously we discussed it prior and this is what worked for us.

One thing we did and anyone can do this, whether they are ten years away from retiring or just one year.  Write down your monthly outgoing's/bills, so you can work out how much you need to cover everything to survive.  I did it all on an Excel spreadsheet, but writing it down in a notebook will work as well.  This is a good habit to get into, and I still do it, just to see where we are each month.

Our spreadsheet, includes all utilities, car/house/life insurances, credit card bills, house/property taxes. Make sure you include cash you take out of the bank each week; with that I multiplied 52 weeks worth of cash divided by 12 to make the monthly amount.  If you have rent/mortgage/car loans etc. include those.  Anything you pay out each month.  Some things like our water/sewage bill comes in bi-monthly don't forget those types of bills.

This helped out a great deal with working things out.

What also helped us was getting forecast's from the government and any private pension companies showing us what we should expect in payments from them when retired.  Both the Canadian and the UK government did this for us no problem.

We have tax free savings accounts here in Canada, use them!!!  They come in handy.  Until you start getting regular payments you may have to dip into your savings accounts to supplement your pensions.

When applying for pensions do it at least six months ahead of time.  Our local library had free sessions with the people from the government pension department.  They were super helpful; as all the forms you have to fill in can be quite complicated; especially if you were born in a different country!  We found the most complicated forms to complete were for the Old Age Security, which is not a huge amount each year.  We were thinking we would have to give them our first born child with the amount of questions they asked!!

Oh and one country talks to another country, so in our case the Canadian government does know where you are receiving other pensions from....LOL  Everyone will take their piece of the pie!

If you were born in another country, you need a lot of info from your birth country, including your citizenship and immigration papers.  Thankfully we were organized and had kept everything from when we lived in the UK and when we moved to Canada.  We also told our kids what they needed and gave them their paperwork, and kept photo copies ourself, as they are 25 years away from retiring.

It did take us a few months to get used to receiving money at different times of the month and we did have one or two glitches along the way.  We receive a monthly amount once per month from a RRIF.  The first month we were to receive it, they forgot to put it through 😠Luckily I had moved money into our savings account as a plan B just in case something like this happened.  The bank and our financial advisor apologized but it was an inconvenience.  (LESSON HERE, HAVE A BACK UP PLAN!)

All our Canadian income/pensions, have between 20 to 30% tax taken off at source, so we do not get dinged with a big tax bill at the end of the year.  All foreign income comes in without tax taken off at source.  We won't know until March 2026 to see if all our calculations were correct when we file our taxes.

Hubby stopped receiving a pay cheque from his employer at the end of 2024.  So technically we have been receiving just pensions since the beginning of 2025.  So far so good, we have managed just fine.  Everyone said we wouldn't need as much money.  I can't say for sure that's the case, but I am guessing the more we slow down and do not do as much that will be true.

We have a window of probably 10 years where we will be fit enough to travel.  So we know that money will be flowing a bit more during the next ten years.    Do we have enough to live off until we are 90; as per the financial advisor and our accountant son, yes we do; but who knows?

If anyone else has any tips or hints for retiring and managing money  please add yours in the comments.

Passports and pensions....

Our passports expire February 2025.  As you can't travel with a passport that has less than six months on it before it expires, figured we may as well get them renewed well ahead of time, in case there was a delay.

As we have a CAA membership we got our photo's taken there.  Mine was free and hubby's was just over $10.  So if you have a CAA membership make sure you take advantage of that.  

We completed hubby's Canadian pension application online and the CPP was easy peasy!!  The OAS though, was another matter.  The word that comes to mind with that form was "ambiguous."  The way they worded some of the questions was confusing.  They also required copies of our marriage certificate and immigration papers.

Both the pension and passports applications required a visit to the dreaded Service Canada office.  Now depending on where you live this could be an all day job.  However we were warned ahead of time not to visit our local office due to the long lines, and go to another office a 50 minute drive from the house.

Believe me when I say it was well worth the 50 minute drive, as we were in and out in under half an hour.  The person we dealt with was so nice and very thorough.  It helped that we had all our paperwork filled out and we brought with us exactly what they needed.

I will say though I felt that $160 CDN each for a 10 year passport was a little pricy; but it's a need not a want in our case.  They told us it would be back within the month; but it will probably be back sooner, or so I have been told by other people.

As for the pensions; we'll hear back hopefully in the next month or two is everything is good with the paperwork.  As we don't need either of them to start until January of 2025, there is plenty of time to fix any issues that may arise.

Oh and a funny story about the passport photos.  We were going to get our photos taken the week before, but I ended up with a spot/zit on the middle of my forehead for some reason.  I took one look at it and told hubby there was no way on earth I was having a passport photo taken with that huge zit on my face, and having to look at my passport photo for the next 10 years and seeing that zit!!!  

As it happened the photo I took is actually a good photo.  Meanwhile hubby looks like an escaped convict. As I said to the lady, oh no, he's going to get stopped going through customs with that photo!! She just laughed and said yes!!

It's not as simple as it looks.........

We are going to be entering another phase in our lives at the end of the year.  Hubby will be "retiring," at the end of September, but will be paid by the company until the end of the year.  So in theory we won't be living on pensions, investments, savings etc., until 2025.

Normally filling out these government forms should be easy, but when you have to have forms notarized, signed by a professional, photo copied etc., etc.  These things take a bit longer than normal.  We have to show copies of immigration, marriage, birth certificates.  We have to supply dates of where hubby worked in the UK, and for how long.  Where we lived in the UK and dates; my info even though I am not applying for anything.  If we got child allowance in both countries, and on, and on it goes.  Good news though, they don't need to know how many times a day you go to the toilet 😜, yes I am being sarcastic!

Both the Canadian and UK governments have different requirements which is normal.  One down side is that hubby will have to go to Service Canada to get items stamped.  That involves lining up for an extended period of time as we only have one location in the city we live and believe me when I say it's busy.  We could go to other cities but it's the same everywhere.

There is an office in the same building as our doctor and the line is generally around the block of people waiting to be seen.

Luckily getting paid by the Canadian Government is pretty easy, as we are all set up with our tax returns.  The saga we went through to get the small pension from hubby work place in the UK took three months to get sorted, but hopefully we can now copy and paste the banking info and it should work for the UK Government.

However, as we all know what works for one official office, is the never the same with another.  So that being said we are going to start the applications by April/May in the hopes everything gets sorted by the end of the year.

Which is quite sad if you think about it, that we just don't trust any government to get anything right?

Now that being said, we are so grateful that we are able to qualify for multiple pensions, as if we had to rely on just the two Canadian government pensions we wouldn't be able to survive on those.  

You have to work 40 years in Canada to qualify for full CPP and the OAS.  As hubby has only 35 1/2 years he gets reduced pensions, which will total less than $2,000 per month, despite the fact he paid his full amount every year he has worked here.

Anyway, all of this is keeping hubby and I busy trying to sort it out.

Then there's the pension and income splitting saga..........but that's enough for one day...LOL  Luckily our son is an accountant, and between me and you he owes us😜