The Rural Voice, 1998-02, Page 13"When 1 retire"
and the dreams come forth
IT'S
YOUR
MONEY
By Paul J. Rockel
Chairman, Regal Capital Planners Ltd.
(NC) — "When I retire..." and then we
hear the dreams really come forth.
"I'll travel...and take my spouse with me
to all the places in the world we've
dreamed of. We'll spend our winters in
the warm climates and our summers at a
cottage here in Canada. Boy, am I
looking forward to that day."
Or..."I want to retire when I'm in my
50s, while my wife and I are still young
enough to enjoy travelling and seeing the
world."
We hear statements like that, we read
similar statements, yet we find very few
people who know, or will apply the
formula for financial success. They
"dream" but take no action to fulfill those
dreams.
The formula for financial success is
three -fold: Time + Money + Rate of
Return. You must save to get the
"money" and you should achieve a good
"rate of return". If possible, that rate of
return should bear little taxation (such as
equity mutual funds where you get
dividends, lightly taxed, and capital gains
only 75% taxed.)
And by far the most important element
in that three-part formula is TIME.
Every day that slips by and you don't
save, can never be brought back. It is
almost impossible for you to make it up,
even by tightening your belt and doubling
your savings. We've frequently pointed
out that a person aged 25, saving $100
monthly at a rate of 12 per cent, would
end up with $979,306. Total invested
would be $48,000.
The person aged 45, saving $200
monthly (twice as much) would also have
saved $48,000 by the time they reached
aged 65, and if the same 12 per cent rate
of return was achieved, would have a
value of $183,971. That's over $795,000
less, because time was lost.
The only way you can retire is on what
I call "your second income". Your first
income is "you at work" and your second
income is "money at work". We must
build that second income by saving a part
of the first income.
The only way we can retire is by
building that "second income" We must
retire on our savings, some of them
forced, such as Canada Pension Plan,
Old Age Pension (paid for through
taxation) and possibly a pension plan at
work. But these "forced" savings have
never proven to be : Jfficient to allow us
to (a) retire early, or (b) maintain our
standard of living and do the travelling,
etc. we would like to do.
It all boils down that if you want to
retire in dignity, be it early retirement, or
normal age retirement, we must save to
build that "second income
Every day missed is gone forever
For a FREE brochure on mutual funds,
ask for "21 Reasons" or contact the
advisor pictured here.
illtREGAL
CAPITAL Bus. (519) 291-1353
PLANNERS
LTD. 1-800-291-1353
Res. (519) 347-2569
406 Wallace Ave. N
Listowel, ON N4W 1 L3
Susan Carter
Financial Consultant
SOME OF OUR PRODUCTS AND SERVICES
Top Paying RICs, Tax Saving Strategies, Mutual Funds, Labour
Sponsored Mutual Funds, RRSPs, RRIFs and Annuities
(The above list represents only a few of the many financial services available
through your Regal Financial Centre.)
This is No. 1185 in a series of articles that have been appearing in newspapers and
magazines across Canada for the past 15 years. For Paul J. Rocker's book "WHY I
INVEST IN MUTUAL FUNDS" contact your local bookstore or Regal Capital Planners
Ltd., telephone 291-1353.
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FEBRUARY 19QR 9