Al & I are just over 4 years from retirement. Our basic plan is to sell the house and travel. At this point, we’re thinking that either a motorhome or a truck with a 5th wheel trailer will become our new home. Things could change but that’s been the idea for a while now.
If it was solely up to me, we would fly off in the winters to a warmer climate. Al’s ideal would be living in the RV full-time. Our compromise is a plan to fly away every second winter and spend the others in the RV in either the southern USA or Mexico. Again, things could change but that’s been the idea for a while now.
Of course, finances are a huge consideration. So, we headed off to see a financial advisor who had been recommended by several people I work with. We didn’t intend to get into the minutiae of our finances but rather to discuss our travel plan, our retirement incomes and see if she found any holes in our plans.
The goods news is that she didn’t tell us we were crazy; nor did she tell us we had forgotten anything major in our plan. But she did explain a few things to us that we weren’t as informed about as we should be.
- A Canadian Power of Attorney (POA) is only good in Canada. Once we’re outside of Canada, the rules of the country/state we are in will vary. For instance, in the USA, the rules vary by state. If one of us was not capable of making medical decisions while we are outside of Canada, the other one might not be able to make those decisions either and there may be a cost to have a government-appointed person make the decision.
- There are some interesting rules about taking your pension in a lump sum. I’m not a pension expert so I’m not going to try to explain them here, but I do suggest that you get professional assistance with your pension planning. Suffice it to say that you don’t have complete control over how the lump sum is dispersed to you. If you’re counting on that money to fund your travels, make sure you understand the rules.
- Count on travel insurance to be expensive. If you have an option of having travel insurance from your work, it may be the best deal you can get. Also, there are different insurance plans available for where you plan to travel. For instance, she mentioned that if we were to buy travel insurance that would include Mexico but not the USA that it would be cheaper than insurance that included both countries.
These are a few of the items that she told us about as Ontario residents. I’m sure it varies by province within Canada and by country outside of Canada.
My intent here is not to give you any advice other than to say talk to a professional about your plans. They can give you some great advice and maybe advise you of some things you didn’t know. Best case is they validate your plan and you can set off on your travels with peace of mind.