How much to retire?

Q & A

How much to retire?

How much do you need to retire? My husband and I currently have about $300,000 in investments and about another $300,000 in equity in our house. We will most likely not have a corporate pension (my husband is self employed and I am a stay at home mom - for now). Do we really need to keep saving other than RESP's for our - soon to be - 2 kids??

Name withheld

This is a very BIG question.

First off, I don't know how old you are and how long you have until you retire. The further you are from retirement, the more time your $300K has to grow, and the less need there is for you to supplement it with hefty contributions. The closer you are to retirement, the sooner you'll need the money and the more likely it is you should still be socking money away. Go to www.fiscalagents.com and use their Retirement Income and Savings Calculator to help project what your retirement income/savings needs will be.

It also sounds as if you're about to start a family - a very expensive time of life. If it turns out that you must suspend retirement savings for a while as you cope with the changes in your cash flow, that's part of life. It's silly to think your life will change so dramatically with no impact on your budget. Just don't fall into the trap of never getting back to savings. Even if you're setting aside a small amount each month, it'll add up and make a big difference when it comes time to retire.

Remember, too, that there will be two of you counting on your retirement savings and, as a woman, you can expect to live till your late 80's. Be old is bad enough. Being old and POOR is horrible. Don't go there girl.