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Sources of retirement income

If you've ever tried sitting on an unbalanced stool, you know how uncomfortable it can be. Legs that are uneven or too short can make for a wobbly and unstable foundation. If one of the legs is missing altogether, you're probably in for a fall.

The "3 legged stool" metaphor has long been used to illustrate the traditional sources of retirement income - your employment pension, your government pensions and your personal savings. It's a fitting comparison - an unstable stool cannot provide the necessary support; the same holds true for your retirement income. If one of your income sources is missing or insufficient, you may have trouble sustaining your finances during your retirement.

This series of articles looks at the traditional three "legs" that make up the basis of your retirement income. We'll also be looking at a fourth source - income from post-retirement employment - which can make the foundation even sturdier. This concept is becoming more and more popular as Canadians leave work at a younger age and spend more time in retirement.

Your pension from the CAAT Plan

Your government pensions

RRSPs and your personal savings

Some RRSP income options

Working in retirement

January 2006