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Your Financial Life Map

Everyone's personal financial situation changest throughout their lives. Because of that it can be difficult to know where we stand and what we should focus on through the years. MoneyPages has created its Life Map which can be used as a guide or point of reference when making financial decisions. None of these ideas are cast in stone; instead they are designed to provoke thought before you make any financial decisions.

MoneyPages – Life Map

 

Ages 16 to 21

  • Enroll in post-secondary education and partially fund with student loans if necessary
  • Find summer employment to help fund your education and to help keep student loans at a minimum.
  • If your education schedule permits, find part time work to help offset education costs and to gain workforce experience
  • Add all employment and education to your resume
  • Learn to become financially independent even if your parents are fully funding your education
  • Pay off any credit card balances in full each month

 

Ages 20 to 30

  • Take pride in being responsible with your spending
  • Learn to live within your means and keep a record of where you spend your money
  • Learn to separate wants and needs.
  • Begin paying any debt you have incurred. Consider part time work in addition to your regular job
  • Start an emergency fund with a goal of having a savings account that will cover 3 months expenses
  • Open a tax free savings account (TFSA) and contribute as much as you can afford
  • Begin saving for the down payment on a home. Hint: your TFSA savings can be accessed for this purpose
  • Review your debt levels to ensure they are appropriate
  • Pay off any credit card balances in full each month
  • Keep your resume updated

 

Ages 30 to 40

  • If you don’t have a pension plan at work, have at least 1x your annual salary saved for retirement by age 40
  • Continue to live within your means and take pride in being responsible with your spending.
  • Keep a record of where you spend your money. Continue to identify wants and needs.
  • Increase your emergency fund to cover 6 months in household expenses
  • Pay off all non-mortgage debt including student loans, car loans, home equity lines of credit
  • Begin contributing to an RRSP and maximize contributions if possible. Check your income tax Notice of Assessment from the Canada Revenue Agency to determine your contribution limits
  • Continue contributing to a TFSA or perhaps withdraw from your TFSA to fund the down payment on a home
  • If you are considering a home purchase ensure that you have enough in savings for a 20% down payment plus closing costs. Set your sights lower if necessary or defer your purchase until necessary funds are in place
  • Open an RESP account if you have children
  • Create a will and a power of attorney
  • Purchase life insurance if you are a parent
  • Examine the merits of disability insurance and critical illness insurance
  • Review your debt levels to ensure they are appropriate
  • Pay off any credit card balances in full each month
  • Keep your resume updated

 

Ages 40 to 50

  • If you don’t have a pension plan at work, have at least 4x your annual salary saved for retirement by age 50
  • Continue to live within your means and take pride in being responsible with your spending.
  • Keep a record of where you spend your money. Continue to identify wants and needs.
  • Continue with RRSP contributions – review notice of assessment
  • Continue with TFSA contributions – recontribute previous withdrawals if applicable
  • If you have children, contineue with RESP contributions
  • Prepare a more detailed retirement plan
  • Review your life insurance coverage
  • Review merits of disability insurance and critical illness insurance
  • Review your debt levels to ensure they are appropriate
  • Pay off any credit card balances in full each month
  • Keep your resume updated

 

Ages 50 to 60

  • If you don’t have a pension plan at work, have at least 6x your annual salary saved for retirement by age 60 Continue to live within your means and take pride in being responsible with your spending.
  • Keep a record of where you spend your money. Continue to identify wants and needs.
  • Continue with RRSP contributions – review notice of assessment
  • Continue with TFSA contributions – recontribute previous withdrawals if applicable
  • Pay off your mortgage and ensure that all other debt is paid
  • Review your retirment plans at least annually
  • Review your life insurance coverage – requirements may have been reduced
  • Review merits of disability insurance and critical illness insurance
  • Examine the merits of long term care insurance

 

Ages 60 to 70

  • If you don’t have a pension plan at work, have at least 8x your annual salary saved for retirement by age 65
  • Continue to identify wants and needs.
  • Review your retirement plans to determine the best age at which to retire
  • Review your eligibility for the Canada Pension Plan (CPP) and determine the best age at which to begin drawing benefits
  • Review your eligibility for Old Age Security (OAS) and determine the best age at which to begin drawing benefits
  • Determine the best age at which to convert an RRSP to a RRIF
  • Determine the best age at which to begin drawing pension benefits if you have
  • Review your retirement plans at least annually, even if you are already retired
  • Explore part time employment or volunteer work options
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