on November 3, 2010
Canadian Retirement Planning Mistakes: Key Strategies on How to Take Action to Avoid Them
Author: Grant W. Hicks, RDB, C.I.M., FSCI, Retirement Planning Specialist
Reviewed by: Anne Holmes for the National Association of Baby Boomer Women
Grant Hicks is a financial educator and well-known among retirees for his expertise in advising retirees - and those about to retire ' on how to simplify their retirement while minimizing tax and maximizing income and cash flow. Who among us wouldn't want that?
As Hicks says, 'Most Canadians feel they can use some more planning when it comes to retirement whether you have been retired for several years or planning for retirement.'
If you are a Baby Boomer living in British Columbia and worried about your retirement, this book is written expressly for you. Keeping in mind, of course, that author Hicks includes a disclaimer at the end of the book, making it very clear that he's not recommending any products or services for sale, here. He is not giving advice to anyone, in any specific financial situation and readers should always consult their own financial professionals.
Regardless, if you are worried about your retirement, you are not alone, and this book covers 48 mistakes he has seen in his practice, many of which are common enough to be considered, in this reviewer's opinion, universal mistakes made by retirees worldwide.
He's written this book as a result of the mistakes he's seen in over 20 years of retirement planning. As a result, it addresses:
' Strategies about minimizing taxes, as saving a dollar in tax may be your best investment
' Information on how to avoid common pitfalls and myths about generating retirement income and cash flow
' Advice on protecting your assets and transferring your money, which he notes is crucially important, since everyone only gets one estate
' How to simplify your retirement and give you peace of mind
' And of course, strategies for avoiding common retirement planning mistakes
The book is divided into four sections, suggesting that Hicks believes typical retirement planning mistakes fall into these basic areas:
' Simply ' Discusses how to simplify your finances
' Manage ' Covers building a retirement income and lifetime investment strategy
' Reduce ' Deals with minimizing and deferring taxes in retirement
' Protect ' Provides strategies and experiences on how to protect your assets
Hicks makes a good case for working with a financial planner on your retirement strategies. As he points out, the great investors don't do it themselves, because they know it is an emotional decision. They come to the logical conclusion to get a team of great professionals to help them avoid retirement mistakes and become comfortable with their retirement plans. He advises the reader to do the same, using a wonderful analogy for retirement planning. Here it is:
A financial planner's job is similar to that of the captain of a large airplane heading off to a distant destination with a full passenger load aboard.
As captain, your financial planner has a timetable and a flight plan. (S)he has a schedule and a manifest.
But as captain he or she knows that along the way the plane may run into weather delays, or experience mechanical or maintenance problems. Same thing on arrival: Again, the pilot could experience airport-related problems or delays.
As your captain, your financial adviser must keep two things in mind: (S)he did not build the airplane and (s)he can't control the weather or the airport. But at the end of the day, (s)he is responsible to get the passengers to their destination AND as long as the passengers don't jump out at 3,000 feet, (s)he will deliver you to your destination.
While the book is written to specifically address mistakes related to Canadian retirement funds, RRSPs, RRIFs, etc., which, of course, don't apply outside of Canada, many of the mistakes he discusses apply to all retirees. For example:
' Second Marriage Mistakes
' Not Diversifying Investments
' No Clear Written Retirement Plan
' Not Managing Risk
' Heeding Hysteria in the Headlines
' Letting Emotions Drive Your Investment Decisions
Which means that while the book specifically addresses Canadian retirement needs, the book is still worth reviewing, even if you are NOT Canadian.
on April 20, 2013
Some good ideas, most of which I've read in other books. However, Segregated Funds (page 110) which the author endorses are huge money makers for those who sell them. There is no mention of this. Mutual Funds in general also attract high fees and seldom beat the indexes. No mention of this neither. Index Funds which are now attracting a lot of investors get little or no mention in this book and yet most index funds beat most mutual funds. The author discusses a Guarantee Minimum Withdrawal Benefit (GMWB), but is scant on detail. How is a GMWB different than an annuity. When I retired a couple of years ago I looked very closely at buying a 6 figure annuity, but the return/guarantee was so terrible that I abandoned that idea and spread the funds across a portfolio of on conservative index funds. I like the author's idea of creating an estate binder.
on July 11, 2012
This book has more info on retiring than all the other retirement books I have read.
Easy to understand, full of good info and to the point, with stuff most folks have never thought of for a proper retirement.
I highly recommend this book to all who have retired, are about to retire and who are far from retirement.
This book will give you lots of answers and ideas.