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So How Much Do You Really Need For Retirement?


A Special Report from BMO Retirement Institute Report Evaluates Six Popular Retirement Planning Theories and Provides Clarity For Customers

TORONTO – When it comes to financing their retirement, confusion reigns among Canadians. Some think the magic number is at least $550,000, while still others believe they need to save at least $1 million.

Adding to the uncertainty are myriad of retirement savings theories, assumptions, and rules of thumb.

“Determining how much money you will need to save is unique for each individual, and it is often more complex than using a simple theory. There is no one-size-fits-all solution and common retirement savings theories should be carefully reviewed before being adopted,” says Tina Di Vito, Director, Retirement Strategies, BMO Financial Group and author of the BMO Retirement Institute’s Special Report, Saving For Retirement: How Much Is Enough?

In the report, Ms. Di Vito addresses the six most common theories/strategies that require careful consideration. These include:

* The belief that one’s retirement can be adequately funded through government pay-outs and public pension plans such as the Canada Pension Plan
* Reliance on company-sponsored pension plans
* The theory that one needs 70 per cent to 80 per cent of their pre-retirement income
* The “magic” $1 million dollar assumption
* Using four per cent to five per cent of accumulated savings annually during retirement
* Planning to delay retirement in order to afford retirement

So, How Much is Enough?

According to Ms. Di Vito, there are many considerations when it comes to planning one’s retirement. These include:

* The age at which you wish to retire
* The type of lifestyle you want to lead
* Your health
* Whether you have outstanding debts going into retirement
* Your expected retirement expenses, such as, housing, food, etc.

Ms. Di Vito therefore stresses that it is important to know your retirement goals and objectives, identify your sources of retirement income and start planning as early as possible.

“You may find that your retirement goals and lifestyle choices change over time and, consequently, the amount of money you need will change,” says Ms. Di Vito. “Once you know what you are saving for, there are three key components to a successful retirement: save diligently, consult a professional advisor and review your plan on a regular basis.”

BMO Offers Helpful Online Resources:

BMO Retirement Institute’s Special Report: Saving For Retirement: How Much Is Enough? Full Report -

BMO Investor Profile Micro site-

Take Charge of Your Retirement Interactive Tool-

About the BMO Survey

The survey was conducted between January 4 and January 7, 2010 using a national random sample of 1516 respondents from Leger Marketing’s Web panel. This method simulates a probability sample which would yield a maximum margin of error of +\-2.5%, 19 times out of 20.

About The BMO Retirement Institute

The BMO Retirement Institute, launched in April 2008, provides thought-provoking insight and financial strategies for those either planning for or in their retirement years. The Institute was launched to help pre-retirees simplify the complex dynamic between personal finances, personal relationships and retirement lifestyles. Contact the Institute by email at or visit for a copy of the report.


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