Working in Retirement

Well my vacation is now over so it’s back to work here. Sorry for the last few days off, but I was a bit busier than I planned.

So I found an interesting article on working in retirement that basically said that 58% of working Canadians plan to keep doing some paid work into their retirement years. In fact, the baby boomers are very keen on the idea with a huge 65% who want to keep working. So the obvious question is: what’s changed?

I think some fears about having enough money are driving this trend, but a bigger motivation is looking for some meaning to their lives in retirement. People spend most of their lives working, so when that is gone there is a sudden void in their lives that they don’t know how to fill without work. Is this wrong? In my mind, not really. Some work in retirement can be fun and useful beyond money concerns to provide social contact, mental stimulation and meaning to people’s lives. The trick is to not let become too large a part of your retirement, otherwise your really haven’t retired at all.

Retirement Trip Wire aka: The Mortgage

While looking at my mortgage balance recently, I realized that I have a small problem with my retirement plans. I want to retire when I’m 45, which is about 16 years away. The problem is my mortgage amortization is currently at 19 years, so I have to either accelerate the mortgage pay down by three years or live with the payments for three years in retirement.

I’ve never liked paying interest, so I think I’m going to try to find a way to accelerate the pay down by three years. Currently I have maxed out my semi-monthly payments with my current mortgage, so I have to wait until three years to pick a shorter amortization or start applying lump sum payments to it. I’m not sure which way I’m going to do it.

So like all good plans, I’m finding some holes in my plan to retire at 45. So far I don’t think I’m past the point of saving the plan, but this has proven to be a bit more of a challenge that I first thought.

Year End Check Up: Net Worth Update

With the end of the year approaching I think it is time to take a snap shot of my net worth and find out how I’m doing. In general practice, even if you do nothing else for the entire year of tracking your net worth it is useful to get an end/start of year snap shot of your financial health so you can track your progress at least yearly.

Assests
House $198,000 (I recently did a survey of house listings in the area, apparently my last estimate of $195, 000 is a bit low since a house with 500 sq ft less that mine is selling for $198,000.)
RRSP $11,600
Wife’s RRSP $4800
Old Work Pension $10,500 (I’m almost embrassed to say I forgot about this in my first net worth calculation)
Wife’s Investment Account $4200
ING Savings Account $1000

Debt
Mortgage $149,900
Line of Credit $0 (As I mentioned before, I keep this as part of my emergancy fund.)

Therefore my net worth now stands at: $80,200.

Even with my ‘lost’ pension money that is still a nice little increase from my first net worth check back in Nov. See you in the New Year.

A blog about early retirement and happiness