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What to budget for in retirement

June 26, 2025

Planning for retirement can seem like a daunting task. Often times, people don’t know where to begin so they put it off, or they make a start but soon find they have more questions than answers. What age should I retire? How much will I need over those years?

The first step towards answering those questions involves creating a budget for your retirement years to ensure you are financially prepared. Using your current budget as a reference, and factoring in the effects of inflation, is a sound starting point. 

However, it’s important to bear in mind that your expenses in retirement will look different than they do now. While you may not have certain expenses — such as childcare related costs, or mortgage payments — you will need to account for other expenses that you have likely not considered. 

Housing and housekeeping

Many retirees bank on downsizing to simplify their home maintenance and free up capital, however, not all retirement condos or “lock-up-and-go” houses are lower-cost options. Certain fees associated with such properties — such as monthly fees related to security, maintenance and amenities — can drive up costs. Be sure to research the kinds of properties you’d like to move into so as to be well-versed in all associated expenses. As you age, you will likely also need assistance with certain tasks you don’t currently outsource. Consider budgeting for such services as house cleaning, garden maintenance and pet grooming so as to not overburden yourself.

Activities and entertainment

In retirement, you will have considerably more free time than you are accustomed to. And where work may have given you a sense of pride, purpose and community, you will need to look elsewhere to meet these needs. Consider what hobbies, club memberships, or volunteering activities you’d like to take up. This could be anything from gym membership or career mentorship to taking a creative class or volunteering at your local hospital or food bank. It is important to fill your time with pursuits that bring you joy and foster sound mental, emotional and physical health, and to budget accordingly. 

Capital outlays

Beyond your day-to-day expenses, it is important to plan for those larger capital outlays that inevitably occur every year or so. Whether this be a surprise overseas trip for an important family occasion, the purchase of a new vehicle or laptop, or providing family support in the occasion of a child’s wedding or home purchase, planning for these larger capital outlays will ensure you don’t “break” your budget.

Healthcare and elderly care

Healthcare expenses typically increase with age. If applicable, ensure you have adequate private medical insurance for your needs, and that you’re comfortably able to meet those higher premiums. Consider, too, additional medical costs to cover your preferred choice of glasses, and hearing and mobility aids, as well as home modifications should accessibility become a challenge for you or your partner. It is also critical to consider potential long-term care needs, such as nursing or assisted living. Such services are expensive, and to ensure you avoid burdening your loved ones, it is best to plan for the possibility of such an eventuality.

Estate planning and power of attorney

An estate plan outlines how your assets are to be distributed in the event of your death. Typically, this involves a will (stipulating who will inherit your money and property) and a power of attorney (granting a trusted person the authority to make decisions on your behalf should you be unable to do so). Keeping important legal documents such as these up-to-date as your circumstances change is important. For this reason, it is advisable to budget for certain ad-hoc legal and advisory fees, too.

People with wealth beyond their spending needs may consider giving to family or charity early (instead of leaving their estate transfer until death). If this applies to you, consider how and when you would like to share your wealth. For some, experiencing the firsthand benefits of sharing your wealth can be meaningful.

Seek expert advice

Planning for retirement is one of the most critical — and one of the most complex —undertakings you will make in your career. Creating a budget for retirement, covering everything from housing to healthcare, is a great first step in crafting a retirement plan. Seeking expert advice from independent professionals such as tax, accounting or legal experts will help you to adequately prepare for your retirement.

Once you have determined your needs and aspirations for those years, you will need to revisit your current savings plan and asset mix to ensure you’re able to make your retirement plan a reality. Much like an estate plan, an investment plan requires expert advice and monitoring to ensure you have peace of mind leading up to retirement and beyond. Our wealth advisors offer the specialized wealth management advice our high-net-worth clients need to meet their particular, complex needs: the need to balance wealth preservation and intergenerational wealth management with realizing their lifestyle goals and leaving a legacy.

Our investment planning tool helps clients pre-experience their future wealth by modeling different retirement scenarios (i.e. spending rates, retirement dates, income levels etc.) against a wide range of market outcomes. Our goal is to help you make informed decisions about your wealth and ensure you are well-positioned to approach your retirement years with confidence. To start a conversation with one of our expert wealth advisors, or to stay connected with CC&L Private Capital, complete our get in touch form on this page.





 

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This material, including any attachments, is provided for informational purposes only. This material is intended for the use of the recipient only and no matter contained herein may be separately used, disseminated, distributed, reproduced or copied by any means, in whole or in part without express prior written consent of Connor, Clark & Lunn Private Capital Ltd. (“CC&L Private Capital”). Certain information contained herein is based on information obtained from third-party sources that CC&L Private Capital considers to be reliable. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of capital may occur. All opinions, estimates and projections contained in this material constitute CC&L Private Capital’s judgment as of the date of this material, and are subject to change without notice. This material has been prepared without regard to the particular individual financial circumstances and objectives of persons who receive it and nothing in this material constitutes legal, accounting, tax or individually tailored investment advice. Readers should consult with independent professionals regarding their individual circumstances, as applicable. This information is not an offer to sell or a solicitation of an offer to buy any securities and is not to be used as a sales communication.

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Catherine Dorazio
Managing Director
Business Development

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