# A year into retirement, reflections and financial advice needed



## jman123 (Jan 28, 2015)

Greetings,

Well, it's been a year since I have retired and it was great. It was no worries and anxieties but with this coronavirus situation some anxiety has returned. 
Celebrating my 67th birthday next month I guess I'm in supposedly near this "danger zone" of 70 years old. Living in Montreal region , so far, I think our mayor, premier and prime minister has done a pretty good job handling this crisis. I am not 100% in health, with some mild cold conditions but it does make your mind wander into the what if I have this virus and all it's ramifications (hospital, ICU, ventilators, death). Trying to live in the moment , as they say, but there is always fear of the unknown in the future. Still, pretty lucky in that I have no preconditions and am generally in good health. So worried about my daughter living and working in New Orleans and my son with Crohn's disease here in Montreal.

I'm glad I retired last March versus this March as I think it would have been a harder sell for my wife since now obviously our nest egg is smaller. My attitude then was that we spent over 40 years saving and now it's time to spend a bit. Not go hog wild but I was hoping maybe spend some money on experiences (i.e travel).

My draw down approach was to basically reverse what I did when I saved. Every month I would pay myself with automatic transfers from my bank account into an RRSP and then later into TFSA accounts. So now, I thought, let me get paid on a monthly basis. 

I took a portion of our RRSPs and LIRA and converted them to RRIFs and a LIF. I have a RRIF and LIF, my wife has a RRIF and a spousal RRIF, 
Total it's about $771K as of December 31. We used my wife's age (65) for the withdrawal rate which came to 4%. 
Obviously, this was quite an easy sell to my wife since the market was doing well.

We have a financial advisor and in past posts people advised me that I should be doing this myself because of the cost (1%) but my wife insisted she would need someone to help her in the situation of my death and also because supposedly they are so "wise" in the ways of investing. At the time, when the market was doing well what was another 1%? A luxury we could afford. Now, maybe time to revisit. 

Anyways, we started this 4% drawdown the last 5 months in 2019 and still continuing.

Through him we tried to create a 60/40 portfolio and have the following funds in our portfolio. 

Fidelity Global Balanced Portfolio
Fidelity Global Income Growth
Fidelity Multi Sector Bond
Fidelity Global Growth Portfolio

The withdrawal is approximately $2,500 per month and I have asked that 20% should be withheld for Federal and Quebec taxes so we get $2,000 net. We don't really need the money what with our OAS,QPP and a small pension from my wife's work making up a nice portion of our needs. My wife did get laid off from work so our income will be somewhat reduced. 

Anyways, my advisor and I both agree that maybe we should reduce our withdrawal rate by 25% and now have a 3% rate. Also, he suggests I change the payment frequency from monthly to yearly and withdraw sometime in December. 

These are my thoughts... I'm thinking of changing half the money coming monthly, the other half in December. Who knows if December will be any better than now or the months in meantime? Now, I will get $1,000 per month net ($1,250 gross) and I am thinking of putting that $1,250 money into our TFSAs each month.

So basically , sell low and buy low. Also, get it out of registered (taxable upon our death) and also less for advisor (another topic for the future). 

I was thinking of doing what I did when I was saving... Automatic transfer to the "Tangerine Balanced Portfolio" fund I have already.

Actually, at the end of February, I took the $2,500 I had received and bought VBAL in a TFSA account so now our room for 2020 is $3,500 for me and $6,000 for my wife. I guess I could continue with VBAL versus Tangerine but I would have to do this myself at the beginning of each month through my RBC direct investing account (a $9.95 cost) and I'm not sure how much better I would be off. I guess now I have to concentrate on performance now since the bull market is over.

Your thoughts, opinions...? 

Anyways, hope you are well. "Happy" that I'm "old" now (lol) and getting government pensions and have saved over the years. Sorry to hear about younger people with mortgages, businesses, families to feed, etc... with no work income coming in. Like, a horror movie out there. Unbelievable and so sad. 

Thanks and Regards.


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## prisoner24601 (May 27, 2018)

jman123 said:


> Greetings,
> 
> Well, it's been a year since I have retired and it was great. It was no worries and anxieties but with this coronavirus situation some anxiety has returned.
> Celebrating my 67th birthday next month I guess I'm in supposedly near this "danger zone" of 70 years old. Living in Montreal region , so far, I think our mayor, premier and prime minister has done a pretty good job handling this crisis. I am not 100% in health, with some mild cold conditions but it does make your mind wander into the what if I have this virus and all it's ramifications (hospital, ICU, ventilators, death). Trying to live in the moment , as they say, but there is always fear of the unknown in the future. Still, pretty lucky in that I have no preconditions and am generally in good health. So worried about my daughter living and working in New Orleans and my son with Crohn's disease here in Montreal.
> ...


JMAN, thanks for your post and congratulations on your successful retirement. Your comment about the advisors fee resonated with me. I made the call to go it alone about 10 years ago after being with a full-service advisor for 10 years. My reasoning was that it wasn't a huge problem when I was saving but during retirement the service provided could cost me 25% of my 'take home pay'. Your example illustrates perfectly, do it yourself and keep 4% withdrawal rate rather than you take 25% haircut and advisor stays on 100% pay. Indeed it could be a higher percentage assuming that you have other assets under management beyond the RIF.

My wife is not comfortable managing our investments so at some point we will be in this situation. I would consider an advisor when that time comes.

Take care and stay safe.


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## jman123 (Jan 28, 2015)

Hello prisoner24601,

Right now, I'm thinking of just reducing the mandatory 4% withdrawal rate to 3% rate as allowed now by the government (25% reduction). I have another RRIF set up personally outside my advisor (about 200K) that I have "seeded" with cash from last year in order to pay myself monthly without selling any funds. These funds are either dividend or interest producing ones yielding somewhere in the 3-4% range. I'll re-evaluate and maybe drop the withdrawal rate to 3% on this one as well. 
For now, advisor stays but shall see. 
Thanks for your reply. Keep well and safe as well


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## jimbob.seeker (Sep 12, 2013)

jman123 said:


> Greetings,
> 
> Well, it's been a year since I have retired and it was great. It was no worries and anxieties but with this coronavirus situation some anxiety has returned.
> Celebrating my 67th birthday next month I guess I'm in supposedly near this "danger zone" of 70 years old. Living in Montreal region , so far, I think our mayor, premier and prime minister has done a pretty good job handling this crisis. I am not 100% in health, with some mild cold conditions but it does make your mind wander into the what if I have this virus and all it's ramifications (hospital, ICU, ventilators, death). Trying to live in the moment , as they say, but there is always fear of the unknown in the future. Still, pretty lucky in that I have no preconditions and am generally in good health. So worried about my daughter living and working in New Orleans and my son with Crohn's disease here in Montreal.
> ...


Jman123, I enjoyed reading your post, thank you.
I have been retired for about 4 years now. Roughly 11 years ago, I ended my relationship with my financial advisor and took total responsibility for my financial affairs. I took the time to develop an investment and retirement/drawdown strategy that I am comfortable with and I have absolutely no regrets. There are still many things that I do not understand about investing and financial matters but I am hoping to improve my knowledge and understanding with time. If you decide to dispense with your advisor entirely, just be prepared to spend the time and energy to learn and manage your own portfolio.

This is a great forum for ideas, questions and shared experiences.


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## jman123 (Jan 28, 2015)

jimbob.seeker said:


> Jman123, I enjoyed reading your post, thank you.
> I have been retired for about 4 years now. Roughly 11 years ago, I ended my relationship with my financial advisor and took total responsibility for my financial affairs. I took the time to develop an investment and retirement/drawdown strategy that I am comfortable with and I have absolutely no regrets. There are still many things that I do not understand about investing and financial matters but I am hoping to improve my knowledge and understanding with time. If you decide to dispense with your advisor entirely, just be prepared to spend the time and energy to learn and manage your own portfolio.
> 
> This is a great forum for ideas, questions and shared experiences.


Hello Jimbob seeker,

Thanks for your input. For the moment will leave as is. 

My question to the forum is also what to do with any excess income I have for 2020? Last year, when I just started our RRIFs and my LIF we just socked away the money in a HISA to be used for a vacation this year. 
I don't think that vacation will happen in 2020 and will plan for next year. 
Since I am withdrawing from these accounts on a monthly basis some units are being sold. 
About $2,500 per month. For February and March, I bought VBAL for my own TFSA. I have about $1K left and my wife $6K.. I have asked that for the next months only $1,250 be sold (Actually, $1,000 if that 25% reduction will take place). The rest will come in December. 
I am figuring of making weekly automatic contributions to add to our Tangerine Balanced Portfolio in our TFSAs for the rest of 2020. 
My financial advisor once in passing mentioned that buying Air Canada would be a good bet since they probably will survive this pandemic and bounce back. 
Of course, I do receive e-mails about good stocks to buy. 
I was trying to be 60/40 and although my portfolio has dropped I think the damage would have been greater if I hadn't made the move. 

Am I wrong still selling units and re-investing back into VBAL and Tangerine in our TFSAs?


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## Gruff403 (Jan 30, 2019)

So your selling from a taxable account to put into your TFSA? Sounds good to me. Do you run tests to see what your anticipated taxes might be? I like the idea of getting money out of RRSP/RRIF earlier then later. Stay healthy.


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