Find out about the best retirement strategies
The definition of retirement has changed tremendously over the past 10 years. Today, retiring does not necessarily mean that you stop working altogether. There are various ways for you to retire. Read about the financial impacts of each one.
What is it?
Phased retirement allows you to reduce the number of hours you work each week. Generally speaking, you must come to an agreement with your employer to benefit from this measure. If you would like to reduce your pace, this might be the best choice for you.
Who is it for?
Phased retirement isn't for everyone. Not all types of employment are conducive to phased retirement, and not all employers will allow you to.
The financial impact
Employment earnings
Unless you have a special agreement with your employer, your employment earnings will be reduced.
Work income after retirement
Pension plans and personal savings
You could choose to use amounts accrued under your
pension plan or
personal savings to make up for the loss of earnings.
A caveat: Be sure you will have sufficient savings to maintain your lifestyle for the rest of your life.
If necessary, consult a financial planner.
Retirement income from personal savings
Pension under the Québec Pension Plan
As of age 60, you could also choose to apply for your retirement pension under the Québec Pension Plan to make up for the lost earnings. If you work while receiving a retirement pension, you will continue to contribute to the Plan. As a result, the amount of your pension will increase.
A word to the wise: If you apply for your pension at age 60, the amount will be lower for the rest of your life.
On the other hand, if you wait to apply, the amount will increase.
Retirement income under the
QPP
Old Age Security pension
You can apply as of age 65.
If you apply after that age, the amount will be higher.
Retirement income under the
OAS program
What is it?
Why not change jobs at age 60? Whether you want to make an old dream come true or just want a change of pace, starting a new career can give you a different outlook on retirement.
Who is it for?
Pro athletes aren't the only ones who change careers when they retire. Here are a few examples to guide you.
- You would like to start your own business and choose when you work.
- Your current employment requires physical endurance, so you choose a job that is less demanding.
The financial impact
Employment earnings
Depending on the work you do, your income could increase or decrease. The latter is more likely.
Work income after retirement
Pension plans and personal savings
To make up for lost income, you could use your
personal savings or the amounts accrued under your
pension plan.
A caveat: Be sure you will have sufficient savings to maintain your lifestyle for the rest of your life.
If necessary, consult a financial planner.
Retirement income from personal savings
Pension under the Québec Pension Plan
As of age 60, you could also choose to apply for your retirement pension under the Québec Pension Plan to make up for the lost earnings. If you work while receiving a retirement pension, you will continue to contribute to the Plan. As a result, the amount of your pension will increase.
A word to the wise: If you apply for your pension at age 60, the amount will be lower for the rest of your life.
On the other hand, if you wait to apply, the amount will increase.
Retirement income under the
QPP
Old Age Security pension
You can apply as of age 65.
If you apply after that age, the amount will be higher.
Retirement income under the
OAS program
What is it?
This is when you completely stop working.
Who is it for?
You may want to completely stop working, or it may be necessary.
If you want to stop:
- You know what you want to do once you have retired.
- You have saved enough to meet your needs.
It may be necessary to completely stop if your state of health prevents you from working.
The financial impact
Employment earnings
You will no longer have any.
Work income after retirement
Pension plans and personal savings
You will need to use your
personal savings and the amounts accrued under your
pension plan.
The amount you need largely depends on the age at which you retire: the younger you are, the more you will need.
Retirement income from personal savings
Pension under the Québec Pension Plan
As of age 60, you could also choose to apply for your retirement pension under the Québec Pension Plan to make up for the lost earnings.
A word to the wise: If you apply for your pension at age 60, the amount will be lower for the rest of your life.
On the other hand, if you wait to apply, the amount will increase.
Retirement income under the
QPP
Old Age Security pension
You can apply as of age 65.
If you apply after that age, the amount will be higher.
Retirement income under the
OAS program
