In this post, we walk through a real case of a couple who came to us with that exact question. They were both 60, ready to retire, and wanted to make sure their money would last while still enjoying life. We’ll show you:
- How much they were originally on track to spend
- The risks in their existing plan
- The three changes we made to improve their retirement success
- And how they could spend more without running out of money
This is a great example of how the right planning can help you retire with confidence, while making the most of the money you’ve worked so hard to save.
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Their Situation
Mr. and Mrs. Smith were both 60 years old and ready to retire by the end of the year. Together, they had saved $1 million across their RRSPs, TFSAs, and a non-registered account. They owned a home worth $650,000 and were hoping to enjoy their retirement without worrying about money.
They wanted to spend:
- $5,700 per month on regular expenses
- $1,500 per month on travel for the first 15 years
This works out to an average monthly need of about $6,450 when the travel is smoothed out over their full retirement.
Both planned to start CPP at 61 and OAS at 65. Their goal was to live comfortably, maintain their lifestyle, and still leave something behind for their children.
The Original Plan
Their current financial advisor had recommended a withdrawal order that focused on minimizing taxes early:
- Start with TFSAs
- Then move to non-registered accounts
- Leave RRSPs until later
On paper, this kept their taxes low at the beginning of retirement. But when we ran the numbers, their plan was only 89% funded. They were on track to run out of money by age 84, six years too early. Even though their home would continue to grow in value, they would eventually need to tap into home equity to maintain their lifestyle.
A Smarter Strategy
We made three changes that helped close the gap and improve both their retirement confidence and long-term outcomes.
1. Delay CPP to Age 67
Delaying CPP from 61 to 67 gave them a larger monthly benefit. While they had to draw more from their portfolio early on, the higher CPP income meant they needed to withdraw less later.
The result:
- Retirement plan improved from 89% to 96% funded
- Estate value increased by $224,000
They considered pushing CPP to age 70, which would have given them an even better result, but decided that age 67 was a better balance between higher income and minimizing survivor benefit risks.
2. Change the Withdrawal Order
Instead of starting with TFSAs, we recommended they withdraw from their RRSPs first, then use non-registered funds, and keep TFSAs for last.
This reduced their long-term tax burden and helped smooth their income over time.
The result:
- Retirement plan reached 100% funded
- Estate value increased by $130,000
3. Align Investments with the Plan
We adjusted their investment strategy to match their withdrawal plan:
- RRSPs (used first) were made more conservative
- TFSAs (used last) were made more growth-oriented
This made their portfolio more efficient, lowered their risk of early losses, and maximized long-term growth.
The result:
- Retirement plan remained fully funded
- Estate value increased even further
The Results
With all three strategies in place, Mr. and Mrs. Smith:
- Reached 100% retirement funding
- Built in a 6-month cushion
- Increased their estate by a total of $370,000
They now had the peace of mind to retire confidently, knowing their plan would last to age 90 and still leave a meaningful legacy.
What If They Wanted to Spend More?
Their kids were doing well financially, and Mr. and Mrs. Smith didn’t feel the need to leave a large estate. They asked what would happen if they increased their spending by 10% an extra $570 per month.
The result:
- They would face a shortfall earlier in retirement
- If they sold their home at that point and rented for $4,000/month, their plan would still carry them to age 90
- Their final estate would be just under $98,000
This gave them the option to enjoy their money more now, without putting their future at risk.
Final Thoughts
If you and your spouse are entering retirement with $1 million saved, your spending power depends on more than just your portfolio value. The timing of your CPP, the order of withdrawals, and how your investments are structured all make a major difference.
The right plan balances lifestyle, taxes, and estate goals and it’s not something you want to guess on.
For more retirement strategies and guidance go visit our website and book an appointment with us.
