A Fantastic Calculator to Help You Decide How Much to Spend In Retirement
If you are close to retirement, I recommend you try out this retirement spending calculator created by Morneau Shepell, a large Canadian human resource company. It’s the most involved and accurate calculator I’ve discovered for Canadians.
The man behind the calculator is the recently retired chief actuary at Morneau Shepell, Fred Vettese, (author of The Real Retirement, a fantastic book I highly recommend to everyone who wants to retire one day).
Like any calculator, the results are only as good as the data you type into it. You will need to know how much you have in your TFSAs, RRSPs, work pensions, and other savings to get useful recommendations. Once you’ve finished inputting your numbers, the calculator figures out how much you are able to spend each year of retirement under a couple of scenarios. It’s also easy for you to change some of your answers (Eg. retirement age) to see how that changes your allowable spending.
I’ve run through the calculations several times under different scenarios and I think the results are spot on.
Many retirees are afraid of running out of money before they die. For that reason, I hope Morneau Shepell keeps the calculator live on their website for a long time. The results provide data to help people make better spending decisions after retirement.
I’m a department head for a high school in Toronto. I graduated from the Ivey School of Business at Western University and have been a DIY investor for over 20 years.