CLIENT SITUATION

The People: Rowan, age 78, and Willow, 58.

The Problem: Can they afford for Willow to retire now and to travel extensively while still leaving some money for their grandchildren? Should they invest more conservatively?

The Plan: When she retires fully, Willow taps into her RRSP. They split Rowan’s RRIF income to keep their income roughly equal and below the OAS clawback range. They take steps to diversify their investment portfolio both globally and by asset class.

Open RESPs for the grandchildren and contribute the maximum.

The Payoff: All their financial goals achieved.

Monthly net income: $8,100.

Assets: Cash $4,000; his nonregistered $707,600; her nonregistered $459,000; his TFSA $214,000; her TFSA $75,000; his RRIF $877,300; her RRSP $305,300, residence $1,500,000. Total: $4.2-million.

Monthly outlays: Property tax

$400; water, sewer, garbage $30; home insurance $275; electricity $155; heating $135; maintenance, security, garden $235; transportation $350; groceries $750; clothing $90; line of credit $415; gifts, charity $225; vacation, travel $2,500; travel insurance $90; dining, drinks, entertainment $375; personal care $50; club memberships $130; golf $75; sports, hobbies $100; subscriptions $50; health care $115; communications $370; TFSAs $1,085. Total: $8,000.

Liabilities: Line of credit $82,500 at 6.5 per cent.