TORONTO -- Don't derail your retirement plans just yet.

You can never know for certain if you have enough money to retire. There will always be wild cards that have the potential to derail you financially. Inflation could tick higher, you could live too darn long and fear you will run out of money, your portfolio could suffer if the markets crash and long-term care costs could escalate.

I assure you no one has ever factored in the risk of a pandemic when planning for their retirement. However, we now need to add this to the list.

In a recent survey, CIBC found that COVID-19 has impacted savings and anticipated lifestyle in retirement. In fact, four out of 10 worry about the effect the pandemic has had on their savings and retirement plans.

I've often asked people: "What do you hope to do in retirement?" Almost universally the first response was they planned to travel. Not any more. Almost a third are not optimistic about travel opportunities. While many feel they will have to work longer (30%) due to a COVID-19-related loss of household income. And while downsizing their home may have been a consideration in the past, 40% are unsure this is the right time to make a move.

The reality is we could spend a third of our life in retirement. And while there is little doubt we have been thrown a curveball, I would argue that before we panic, we should treat the pandemic like any other wild card we may encounter in life.

A few things to consider if you are thinking of retiring:

  1. Now is a pivotal time to reassess your numbers: know much money you have saved, where your money is coming from in retirement and what it is you will be spending your money on. Lessons learned during the pandemic suggest we can live on less and can cut our discretionary spending. In others words we do have some financial flexibility here.
  2. Our portfolios may be out of balance and in the past we may have taken on more risk then we can tolerate. Now is an ideal time to rebalance your portfolio and ask yourself not only how much money are you willing to lose but how much can you afford to lose. We have also come to realize sometimes doing nothing during periods of market volatility is the right course of action when we have a portfolio that is aligned to who we are as an investor.
  3. The decision to sell your home is often driven by lifestyle decisions and financial needs. Before you rule it out, explore how your life has changed and whether your desire to live in a certain location has changed as well.

Before you make any big retirement decisions begin by re-assessing where you are today, create new assumptions about what your retirement will look like tomorrow and then look for ways to bridge the gap.