Seeing a financial planner
Find out what kind of retirement you’re looking at based on your current savings and assets. You’ll find out if you need to contribute more towards your superannuation fund or if you’re on track for a comfortable retirement. To find out more, read the article “Working with a financial planner.”
Evaluating your income
Keep up-to-date with the market rates for your job, and make sure you’re being paid in line with your skills and experience. Make sure you plan to ask for raises and promotions every few years, and be open to moving to a new job if it will offer better pay.
Housing upgrades
You may want to renovate or expand your home, especially if you have a family. This can be an expensive undertaking, although if you have enough equity in your mortgage it may be possible to release some of it to pay for the renovation. Just ensure you understand all the pros, cons, and ramifications of using home equity.
Alternatively, if your family is growing, you might be looking to move to a larger home, whether you’re buying a new place or renting a larger one. Remember to factor in the costs of buying and selling a house and moving, plus extras like new furniture.
Enjoying life
At this stage, you’ve likely spent 20 or more years in the workforce. If you’ve got an emergency fund, some savings, and have paid off any consumer debt, don’t forget to set aside some of your budget to things you enjoy, like travel, entertainment, culture, and hobbies.
Building wealth
If you haven’t put plans in place already, now is the time to get serious about growing your wealth for retirement or any of your other financial goals, whether that’s contributing more to your Registered Retirement Savings Plan (RRSP) or investing in stocks and shares or real estate.
Protecting your income
If something happens to you and you cannot work, you want yourself and your family to be protected. Research options for health, disability, income protection, and life insurance to see what’s right for you. It’s a good idea to do this in your 40s while you’re in relatively good health.
Educating your kids about money
Depending on your kids and their age, they may not be earning their own income, so all their disposable income needs to come from you. However, as they get older it’s likely their tastes will become more expensive as they choose their own clothes, entertainment, and hobbies. Speak to your kids about budgeting, their allowance, and what you’ll pay for versus what they have to save up for. Establishing this kind of conversation about money can also help them establish good financial habits that will carry them into their future.