With nearly $2 million in assets, 64-year-old Tatiana is facing a financial crossroads. She's been collecting disability benefits and her late husband's pension, but these will stop when she turns 65. Her short-term goals include financial freedom, more travel, and helping her family. She also wants to give an advance inheritance to her two children. Her retirement spending goal is $72,000 a year after tax, compared to her current $39,500. An independent financial planner, Warren MacKenzie, has analyzed her situation. He suggests that Tatiana has more than enough savings and investments to achieve her goals, but her concerns about running out of money persist. Tatiana's monthly after-tax income, including investment income, is $6,315 at 65. Her assets include savings accounts ($400,000), cash ($176,000), RRSP ($252,000), tax-free savings account ($224,000), residence ($500,000), and cottage ($325,000), totaling $1,877,000. The estimated present value of her two DB pensions is $1,100,000. Her monthly outlays total $3,285, leaving a surplus of $3,030. She has no liabilities. Tatiana's financial situation will evolve, and she needs to update her plan to ensure she stays on track. The planner recommends using funds from her high-interest savings account to contribute to her TFSA and suggests delaying CPP until age 70 for higher benefits. She also considers selling her home and moving to a retirement home, which would provide sufficient funds for a comfortable retirement. The planner advises Tatiana to reassess the value of her cottage and pass it on to her children fairly, considering their individual valuations. Tatiana's investments are diversified, but she lacks confidence in her financial knowledge and wants to avoid market downturns. She should request performance reports from her financial advisor to ensure they are delivering value. Regularly updating her financial plan will be crucial for her peace of mind in retirement.
