How much money would you need to have coming in to have a comfortable retirement?
Each of you will have a different answer for this question.
If OAS and CPP (along with the GIS of course) bring in about $1500/month, some of you are going to say another $1k would be fine, some of you are going to suggest another $10k/month would give you a nice retirement.
I am writing this post not to depress you, but more to get you dreaming BIG! If you don’t like real numbers and think you might get depressed, click HERE.
So, here’s the deal… any money you earn on-line is taxable income. At some point in time, once you start earning a nice amount, you are going to lose your GIS – that’s for low-income seniors – and I know my plan is to NOT qualify for the GIS!
At the time of writing this, tax rates in Canada are as follows:
- 15% on the first $43,561 of taxable income +
- 22% on the next $43,562 of taxable income (on the portion of taxable income over $43,561 up to $87,123), +
- 26% on the next $47,931 of taxable income (on the portion of taxable income over $87,123 up to $135,054), +
- 29% of taxable income over $135,054.
I’m going to crunch some numbers for you now… but take them with a grain of salt as there are too many unknowns… like
- What will your pension income really look like
- What will your taxable income really look like
- You will have a bunch of write-offs with your home-based business and I have no idea what those numbers look like!
So, let’s say you are going for simple. You want to earn an extra $1k per month over your pensions. If you are fairly low income, you remain at the lowest taxation rate of 15% and so you will owe the government only $1800/year. Technically, your take-home earnings are now $850/month. Still pretty nice supplemental cash.
Let’s dream a little bigger! Let’s get you earning an extra $5k/month with your on-line business. That puts you at least into the high 70ks in income and you owe the government in the ballpark of $13-14k at the end of the year. Your take home is still pretty good, just over $60k/year.
That’s why I have decided to blow my income expectations right out of the water!!! My goal is to earn well into the 6-digits each year. The government can have their share because
- I can afford it
- No one will ever be able to accuse me of living off the government
- If younger generations have concerns over what the pension system will have left for them, my conscience is clear!!
How about you? Are you going to dream big? Are you going aim for the stars? I figure that if I aim for the stars and don’t quite make it, I am still in the stratosphere!!! And the view from there is pretty remarkable! Way better than the one from a small senior citizen apartment on the poor side of town.
Right now, lofty goals may seem a little crazy… but believe me, when you have been around this on-line space a while you find out there a whole ton of ways to earn income. When you have “a whole ton of ways” in your stable, that’s called multiple streams of income and it almost assures you that a good stream of income can be maintained!
Well, I got myself all excited just writing this post!! 99.9% of us started small when we came on-line but through focus, determination and some good old-fashioned hard work we moved up the income levels!
Are you in?
I hope so!!
Now, before I go, the video I sent the faint-of-heart off to view is actually quite cute. Click the word “HERE” above and check it out. Before you go, though, leave a comment below as to what sort of supplemental income would make your retirement dreams come true. We’re all different so there are no wrong answers!!!
I’m in!
A great simplified way to demonstrate what is needed. I guess a government demanding less tax is out of the question so the stratosphere it is then…
See you up there Agnes!
Hi Agnes, I resonate with that! Your comments certainly put the whole income thing into perspective. I like the fact that you are happy to pay your taxes because you can afford them! The principle of what you say applies to many countries and certainly here in the UK. Good wishes John
So true, especially the part about “good old-fashioned hard work.” I feel like most people forget about that one 😉
Well, that’s a bit of a reality check, lol. Thats why I’m starting now (in my 40’s).
Love the video, Love the stratosphere. I’m there with you ladies. I think we’ll need it. Thanks for the laugh and the inspiration!
Goals and ambition is important no matter what your age. It’s good to see you’re on the ball with what is likely to happen and have a plan to cope with everything. So important too.
Dreaming big is so important. Dream small and you will probably hit your goal and go no further. Dream really big and even if you don’t quite hit that goal you are still miles ahead of the small dreamer.
Great reality check post Agnes, well done, if only I’d known that….. no don’t go there, things happen for a reason and hey, I’m still looking, but enjoying the challenge. Great piece of Goal Setting in here too… see you at the top! Kind regards
My biz coach constantly mentions a woman who refuses to take Social Security because she’s not going to be on the dole, or something like that. I like your decision to not be eligible for the GIS.
I’m still conflicted about my income goals, but am sensing that that conflict will wane or disappear. My goals are definitely in the 6-figure category for 2014 and high 6 figs to 7 for later.
I never expected number-crunching to be so uplifting as yours is.
The post from my website is from my travel blog, Scribbler’s Travels. I have another website, russellburckcoaching, which is just a landing page and opt-in page, but will have a blog on having a business in retirement as soon as my web designer and I can get in contact again.
Thank you for dropping by, Russ! Your Scribbler’s Travels looks fabulous and of course “New Zealand” caught my eye as my son lives there now and it is a destination of choice.
I feel really strongly that we should never feel conflicted about income when we enjoy the earning of it, pay our toll to our government, and then enjoy the spending of it… whether it is on ourselves, our families, others or causes. I will put great thought into the spending of my income, but I determine to have joy throughout the process!
I look forward to seeing your future site!
Thank you for your kind words, Agnes.
Intellectually, I agree with you, but there’s a bit of me that’s working against prospering. Anyway, I’m not going to empower it by writing about it here.Just keep moving forward.
Now to scope out the rest of your site.
Have a good one