Retirement Planning in London, Ontario: What You Need to Know

Retirement is one of the most complex financial transitions most Canadians will ever make. You spend decades in accumulation mode — saving, investing, paying down debt — and then suddenly you need to shift into distribution mode, drawing down what you've built in a way that's sustainable, tax-efficient, and aligned with your actual goals.

For residents of London, Ontario, there are real advantages to working with a local financial planner who understands the regional landscape. But more than geography, what matters is working with someone who builds retirement plans with genuine depth and precision. Here's a practical overview of what that looks like.

Understanding Your Retirement Income Sources

Canadians typically retire on income from a combination of sources. Understanding how each one works — and how they interact — is the starting point for any retirement plan.

Canada Pension Plan (CPP) is available as early as age 60 and as late as age 70. Every year you defer past 65 increases your monthly benefit by 8.4%, and every year you take it before 65 reduces it by 7.2%. The right timing depends on your health, other income sources, and your tax situation — there's no single right answer for everyone.

Old Age Security (OAS) begins at 65 (or 70 if deferred for a larger amount). Unlike CPP, OAS is not based on contributions — it's a universal government benefit. However, it becomes subject to a clawback (repayment tax) if your net income exceeds a certain threshold, which means high-income retirees need to plan carefully.

RRSP/RRIF withdrawals represent the bulk of self-directed retirement savings for many Canadians. Your RRSP must be converted to a RRIF by December 31 of the year you turn 71, at which point mandatory minimum withdrawals begin. The tax impact of those withdrawals — and their interaction with CPP and OAS — is one of the most important retirement planning levers available.

TFSA withdrawals are tax-free and don't count as income for the purposes of benefit clawbacks or income-tested tax credits. This makes the TFSA a highly valuable tool for managing retirement income in a tax-efficient way.

The Sequencing Problem

One of the most underappreciated aspects of retirement planning is the order in which you draw from your various income sources. Different sequences lead to dramatically different tax outcomes over a 20-to-30-year retirement.

For example: drawing heavily from your RRSP in your early retirement years — before CPP and OAS kick in — can reduce your RRSP balance (and future mandatory withdrawals) while keeping your overall taxable income manageable. If done well, this can minimize lifetime taxes significantly.

Conversely, leaving your RRSP untouched while drawing primarily from non-registered accounts and triggering large RRIF withdrawals later alongside full CPP and OAS payments can push you into higher tax brackets unnecessarily.

There's no universally correct sequence. It depends on your specific numbers. But getting it right can be worth more than any single investment decision.

Healthcare, Longevity, and the Planning Horizon

Retirement planning in Canada often underweights longevity risk — the risk of outliving your money. With life expectancy continuing to increase, a couple retiring at 65 in London, Ontario today should plan for at least one spouse potentially living into their late 80s or early 90s.

This has several implications:

• Inflation matters more than people expect. Even modest inflation erodes purchasing power significantly over 25+ years. A retirement income plan needs to account for rising costs, not just initial needs.
• Healthcare expenses increase with age. While Canada's public healthcare system covers most major costs, dental care, vision, hearing aids, home care, and prescription drugs can add up substantially in later years.
• A sustainable withdrawal rate matters. Drawing too aggressively from your savings in early retirement — even in a strong market — can leave you exposed later.

A retirement plan that only projects five or ten years isn't really a retirement plan.

Working With a Retirement-Focused Financial Planner in London

London, Ontario is home to a range of financial planning professionals, but not all of them specialize in or prioritize retirement income planning. When looking for a planner, ask specifically about their experience building retirement income strategies — not just managing investment portfolios.

A good retirement-focused financial planner will model multiple scenarios for you, help you understand the trade-offs between different approaches, and review your plan regularly as tax laws, market conditions, and your own circumstances evolve.

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Marc Pineault is a financial planner with Pineault Wealth Management, based in London, Ontario. He specializes in helping clients in their 40s, 50s, and 60s build retirement plans that are detailed, tax-efficient, and built to last. To book an introductory conversation, visit pineaultwealthmanagement.com.

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This article is for educational purposes only and does not constitute personalized financial advice. Please consult a qualified financial planner before making any financial decisions.