What does retirement mean to you?
Early retirement has always been my biggest financial goal. I talk about it all the time on this blog: I want to retire by the time I’m in my mid 50’s. But what does “retire” actually mean?
My dad retired this year at age 65. He had wanted to retire earlier, but since he didn’t have a pension with the company he worked for, he had to wait and save. As for my mom, she’s got a nice government pension waiting for her when she retires – likely while she’s still in her 50’s. She worked at the government for almost her entire career, and as I look back at the first 8 years of my career, I haven’t had that kind of stability at all. And without a company pension to look forward to in 25 years, the cost of early retirement stresses me out a bit.
When I do my retirement calculations, I don’t include CPP or OAS payments, because I’m not sure I can rely on that money being there for me 35 years from now. But that being said, the average combined annual payout from CPP and OAS is currently $12,528 and the maximum annual payout is $18,372. So if that money is still there when I retire, it will be a significant amount of cash coming in that I haven’t been planning for. Wouldn’t that be nice?
So when I think about retirement, what does that actually look like for me? Retirement to me means having the freedom to do whatever I want to do, without the obligation to work for a living. I guess you could call it financial independence, rather than retirement. I know myself pretty well, and I know that I likely won’t stop working completely when I retire. But I’d like that option, if that’s what I want to do. Maybe some people wouldn’t consider that actually retiring. But retirement can mean different things to different people. Maybe I’ll volunteer. Maybe I’ll travel (I’ll definitely travel). Maybe I’ll become a landlord, or work part-time in a coffee shop, or maybe I’ll still be earning an income through this blog. Who knows what I’ll be up to! But whatever it is, it’ll be my choice, and it won’t be based on the need to bring in an income. Freedom.
I’m 31 right now. I’ve always envisioned retiring back in my hometown, with a small home by the ocean. But, a lot can happen in the next 25 years, and I don’t subscribe to the idea of necessarily needing retirement to look a certain way. I may have this exact lifestyle for the rest of my life, or maybe marriage and kids are in my future. Maybe my retirement will look completely different than what I’m thinking of. So while I have very little financial obligation right now in my life, it only makes sense to try and save as much as possible in case I’m not able to later on in life. Kids are expensive. Emergencies will happen. Big travel plans will appear. Health will deteriorate. I want to work hard now while I’m young(ish) and able-bodied, because when I’m older I know I’d rather be doing anything instead of working for a pay cheque and worrying about money. :)
I’ve been giving a lot of thought to my 2014 goals, and since early retirement is still a priority for me, you’ll see that reflected in what I have planned for next year.
What does retirement mean to you? At what age are you looking to retire?
Author: Krystal Yee
I’m a personal finance blogger and marketing professional based in Vancouver. I’m a former Toronto Star (Moneyville) columnist, author of The Beginner’s Guide to Saving and Investing, and co-founder of the Canadian Personal Finance Conference. When I’m not working, you can usually find me running, climbing, playing field hockey, or plotting my next adventure.