The 30-Year Weekend: Planning for the Retirement Adventure of a Lifetime

What if we told you that your retirement might last almost as long as your career?

As people are living longer lives, it’s not uncommon to expect anywhere from 25 to 35 years of retirement. This is longer than most of us might have imagined when we first started building our nest eggs.

It’s the longest weekend you’ll ever experience.

There might be a few more medical appointments. You may not be dancing until 2 a.m. (unless you really, really want to). You might end up waking at 6 a.m. even when you’re certain you wanted to sleep until 10 a.m.

Generally, though, you’ll be the one deciding what you want to do, every day. For decades. For the rest of your potentially very long life.

So how do you think about a retirement that might be almost as long as your working life? With thoughtful planning, a clear sense of purpose, and a touch of optimism, you can turn those years into a fulfilling, secure, and vibrant chapter.

Turning Your Nest Egg Into a Paycheque

You’ve spent years putting money into RRSPs, TFSAs, pensions, corporate and other accounts. You’ve invested in real estate. You’ve grown a business. But how do you turn all that into regular, reliable income?

People in the financial services industry refer to this as your drawdown or decumulation strategy. Often, the discussion is mostly focused on tax – which isn’t wrong. Tax is a really, really important component of this.

However, tax is almost never the first place we start when we’re trying to answer most questions. Where do we start? Oh, with YOU of course.

Step One: Cash Flow Planning

Questions, questions, questions. Spring always answers my questions with more questions, before we can get to answer. We know. We’re very annoying.

What does your ideal lifestyle look like, right now, as we know it?

More than daily and monthly “budgets”, we want to really know how much money in your bank account will allow you to not only pay the bills but also the fun stuff like holidays and hobbies and sports and concerts. We want to imagine you at family events and how much those might cost, really, for you to be happy with the outcomes. We want you to feel comfortable when you make a purchase, even if on a whim.

Monitoring how this changes throughout your life, and adjusting your cash flow plan, is a key to sustainability.

What do this year and next year look like from a spending perspective? Are there unusual costs, beyond our ideal lifestyle that may come up

We often are pretty good at having a sense of what our plans are for this week. We may even be able to stretch that understanding out to a full 12 month cycle. Some people can even think into the following year, which is extra helpful.

Is there a renovation coming up? A vehicle that might need new tires or replacement altogether? A child graduating from university, getting married, or a grandchild on the way? What do we see on the horizon? How do we prepare for it?

Step Two: Long Term, Big Picture Planning

We started with optimism. Now, we need to consider the stuff that isn’t so great. Not because we want the not-so-great stuff to happen, but because we know some not-so-great stuff will happen. We want to be prepared.

What are the things that might happen… which we hope won’t happen… but we don’t want to be surprised by?

Yes, we’re living longer. We’re not aging backwards, though, unfortunately. Whether we are preventing future illness and injury, or managing an existing condition, the costs of health care increase as our bodies move through the decades. It might be easy to imagine the first 5 to 10 years of retirement, where we might be traveling and resting and socializing, and generally enjoying ourselves the most. It’s much harder to imagine, and especially hard to plan for, those times when we might not be able to manage our own home and garden repair or our household tasks. Even harder is imagining debilitating long-term illness, incapacity, and nursing costs.

We need to plan for all of them.

Canada’s health care system is generous in many ways, but it doesn’t cover everything, especially in retirement. Prescription drugs for seniors often require additional private or provincial coverage, and services like physiotherapy, dental care, and hearing aids typically come out of pocket.

When it comes to home care or long-term care, the options and quality can vary widely, and the costs can add up quickly. Planning ahead for these potential expenses is an essential part of building a resilient and realistic retirement plan.

If you are planning as a couple, we unfortunately also need to plan for a time when one person has passed and the other is living a life without them. What does that mean?

Losing a spouse is one of the most stressful experiences an adult can go through. It’s hovering around #1 in long-term studies. That stress is enormous. It takes years to adjust.

At the same time, the surviving spouse has significant decisions to make. Even if there is more than enough money to manage if the two of you both lived to well over 100 years old, in the same way you live right now, the reality is that the surviving spouse will not live the same way.

They will travel differently. They may choose to stay in their home, or sell it. They may experience significant health setbacks, which are not unusual when someone loses their life partner.

They will also lose their partner’s Old Age Security, some of their Canada Pension Plan, and having more than one tax return on which to allocate income. The tax cost – while still not our first concern – is a very real one for widowed people.

Step Three: Big Picture Feasibility & Tax Planning

See, we got here eventually.

Once we have a sense of what kind of life we might be living, and we’ve thought about all the extraneous stuff that might happen, whether it’s fun, really not fun, or a total surprise, we can start to build a lifelong strategy.

We start by looking at the entire period, from the start of your retirement to the end of your life (or, our best guess at when the end of your life may occur). We look at the rules, regulations, and tax implications of each source of income. We then build starting points.

Maybe your corporate draws will start first, with some RRIF income. Maybe your Defined Benefit Pension Plan starts first, and government pensions are delayed. Or they start earlier than one might expect. Maybe you sell your investment real estate earlier… or maybe later. Maybe you maximize contributions to TFSAs throughout your lifetime without spending from them, with the goal of leaving a large, tax-free estate gift or giving tax-free lifetime gifts – provided we can afford them after testing the potential not-so-fun stuff from step two.

The strategy that works for you is going to be entirely dependent on what we’ve learned in steps one and two. There isn’t one “right” answer that works for everyone – but there are a lot of wrong answers that won’t work for you. Let’s spend time here, so we know that what we’re building is structured around what is most meaningful for you and your family.

Step Four: Annual Review & Annual Tax Planning

As one of the investment managers we work with has said: This is where the rubber hits the road.

All of the above is about working in theory, our favourite place to be at Spring. Now it’s time to test the realities, review, adjust, and implement.

Each year, it’s really valuable to review actual spending versus expectations, actual investment, dividend, pension, and RRIF income versus expectations. Then, adjustments can be made to manage unforeseen changes, and get a sense of what actions we might be able to take before year end.

From there, we want to look forward to next year. Knowing what we know about how we spent over the past year, what might we change going forward? Knowing that we have plans to purchase a vehicle, replace that hot water tank, and travel to Italy, how will that impact our income next year? What changes might we make in the amount we draw from different parts of our income plan?

How do those changes impact the long-term projections and expectations? Are there further adjustments we might need to make?

The Bottom Line

Retirement isn’t just about stopping work, it’s about starting something new, and planning for it with care, confidence, and clarity. With the right strategies, habits, and reviews, your nest egg can support not just your lifestyle, but your health and independence, too.

And if you want a co-pilot for that journey, we’re always here to help you navigate every twist in the road.

Your Spring Planning Team

Practice Notes:

Our offices will be closed for Victoria Day on May 19th.

Julia will be travelling a lot throughout May and June for both personal and business reasons. Her travel adventures include being MC for the third year in row at the Family Enterprise Canada Symposium, this time in Halifax, speaking about succession planning at an independent insurance advisors’ conference, and traveling to Toronto for the annual Society of Trust & Estate Practitioners (STEP) annual conference.

Spring in the News:

Julia spoke with CBC Kids about stock markets, tariffs, and more. We didn’t know that there was a kids’ focused news format before and it was fun! Check out the article here.

Julia had a great time talking about families, succession, estate and all those feelings in the Your Estate Matters podcast with Nicole Garton. Listen to the full podcast here.

Please check out our media page here for videos, podcasts, interviews and more.

Planning News Digest:

• Intricacies of cross-border estate planning: Our friend Cheyenne Reese appeared on the Your Estate Matters podcast to talk about Estate Planning for Canadians with U.S. Assets. Listen to the podcast here.
• Where are Canadians traveling to this year, instead of the US? Readers of Rob Carrick’s newsletter in the Globe & Mail chose some very interesting spots, both within Canada and internationally. Check out the full article.
• If you’ve done values work, are your values nouns or verbs? This Simon Sinek podcast (shared by Julia’s brother!) talks about what a difference a verb makes. Watch it here.

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