Notwithstanding the various retirement income planning guides and models referenced in the previous article in this series – their applicability will vary according to the personal circumstances of each retiree or retiring couple.
As reported in Rob Carrick’s Globe & Mail article of FEB 5th, 2017 entitled: “The new way to tell if you’ve saved enough for retirement“, a more accurate model has been developed by an actuary and academic researcher at Dalhousie University, Dr. Bonnie-Jeanne MacDonald and colleagues Lars Osberg and Kevin Moore, called the: Living Standard Replacement Ratio or LSRR.
Essentially it is based upon a personalized calculation of your own savings; obligations; assets; liabilities; expenses; income and retirement objectives.
It demonstrates what, after paying for major costs you and your spouse have for each other while working and whether you will have more, less or the same in retirement.
The LSRR is the ratio of leftover money to spend on you and your spouse in retirement divided by leftover money to spend on you and your spouse while working.
If your LSRR is less than 100 you need either to increase your retirement income planning or reduce your expenses.
The LSRR will vary for every family, but is meant to provide a more accurate reflection of everyone’s specific situation.
Add that arrow that to your retirement planning quiver and start as early as you can; remembering that : ” You cannot plough a field by turning it over in your mind” (Anonymous).