The Right 'Tools' Crucial in Planning for Retirement

The Toronto Star

By Ellen Roseman

Review by Journalist Ellen Roseman Published in The Toronto Star

"RetireWare's Web site is worth a trip even if you don't buy the software."

RetireWare is building its reputation as the best retirement planning software in Canada.

Your life after retirement may last as long as your working career. Careful planning will ensure your money doesn't run out before you do.

To be your own retirement planner, you need good tools. You have to gather the right information about your finances, then plug it into a worksheet or computer program and do some calculations.

The Canadian Bankers Association's free booklet, Planning For Retirement, offers a good overview of the topic. Call 1-800-263-0231 or check the Web site (www.cba.ca) under publications. Along with a retirement planner, the 36-page booklet has information on winding down your registered retirement savings plans and comparing retirement income options such as registered retirement income funds and annuities. (Watch for similar tips in upcoming Money 101 columns.)

A good book on retirement planning is Gordon Pape's Retiring Wealthy In The 21st Century (Prentice Hall, $32.95), to be reissued as a $21.95 paperback next month. I also recommend Make The Most Of What You've Got: The Canadian Guide To Managing Retirement Income (John Wiley & Sons, $24.95) by Sandra Foster.

The two authors disagree about the need for professional advice. Foster, a financial planner, says everyone should get it. Pape, a journalist, is not sure it's necessary.

"An important rule relating to professional advice," says Pape, "is not to obtain more than you require. None of it comes free; if you don't pay for it directly, you'll pay for it indirectly through commissions."

RetireWare is a low-cost program that lets you do some planning and income projections. The developer says it does more calculations using Canadian tax and pension rules than other popular financial software. The program can be downloaded electronically for $29.95 (plus goods and services tax and provincial sales tax) at www.retireware.com, or ordered on CD-ROM ($39.95 plus tax and $5.50 for shipping and handling) from Apeiron Software Limited, P.O. Box 7293, Station A, Toronto ON M5W 1X9.

RetireWare's Web site is worth a trip even if you don't buy the software.

You'll find interesting articles ("Will the Canada Pension Plan be around when you retire?") and links to other Internet resources.

When starting to plan for retirement, your first stop should be Human Resources Development Canada's Web site (www.hrdc-drhc.gc.ca).

That's where you get the nitty-gritty on Old Age Security and the Canada Pension Plan.

The department has revamped the home page for income-security programs to make it easier to find what you need.

Your next stop: RetireWeb (www.retireweb.com), created by actuary Scott Parkinson of Hutchison Avenue Software Corp. in Montreal.

While not updated in recent years, RetireWeb has some useful calculators for life expectancy, mortgage vs. RRSP payments, annuities and RRIFs. Best of all is one calculator that tells you how much to save each year to receive the income you target at retirement.

A more current site is www.rrsp.org, which has information and links but no calculators. Financial planner Doug Hudson, who created the site, urges people to get professional advice.

Next week, we'll look at the pros and cons of hiring a financial planner.

Ellen Roseman's Money 101 column appears Sundays. You can reach her by writing Your Business c/o The Toronto Star, 1 Yonge St., Toronto M5E 1E6 or at (416) 865-3630 by fax or erosema@thestar.ca by e-mail.