How to Change the Retirement Age Setting
When you create a new scenario, one of the settings is the retirement age of the client. This initial retirement age is used to indicate the years for which employment income is displayed in the projections and to determine the start age for government benefits. There are two main steps when updating the retirement age.
Note: Before changing the retirement age, consider if you want to first copy the scenario so you don't override your current plan.
Change the Retirement Age
You can change the Client or Spouse's retirement age on the General Settings page. Select Scenario Setup -> General.
If you change the retirement age, you'll be presented with a checklist with the option to also update other figures in your plan that are typically associated with retirement.
You can check each box to update CPP start age, OAS start age, and DBPP start age. If you check any of these values, they'll be updated to the new retirement age only if they were previously the same value as the retirement age. To illustrate, if your client has a retirement age of 65, with CPP to start at 65 and OAS to start at 65, then when you change your client's retirement age to 67 and check the boxes for CPP and OAS, the start age for both of these government benefits will be changed to 67 automatically. If the retirement age were 65 and CPP and OAS were any age other than 65, then the government benefits would not be updated when you change the retirement age (even if you've checked their respective box).
You can also update the CFM start age automatically using this new feature. In this case, the new CFM start age will be set to the year of the first retirement, only if it was previously set to start the year of the first retirement. To illustrate, if your client and spouse are the same age and have a retirement age of 65 and 67 respectively, then if the CFM start age is currently 65 and you change the client's retirement age to 69, then the CFM start age will be set to 67 (the retirement age of the spouse and the earlier of the two).
You can also check the box to update RRIF withdrawals start age and LIF withdrawals start age. In this case, if the RRIF or LIF are set to pay their first payment as of the year of retirement, then when you change the retirement age and check the box for RRIF or LIF withdrawals start age, then the software will update the settings so the first year of payment occurs at retirement.In all cases, additional logic is checked to avoid unintended outcomes (e.g., OAS won't be set before 65, CPP and OAS won't be set higher than 70, RRIF and LIF withdrawals won't be set any later than 72).
Review your projections and make any additional updates that are required
Once you've adjusted the retirement age and any associated values through the above steps, you'll want to review the Planning pages to ensure everything looks good. This review should consider:
Check to ensure the Employment Income lines up with the retirement age and it finishes the year before the intended retirement.
If you previously adjusted the Employment Income other than a simple indexation for inflation (e.g., reducing a year for parental leave or semi-retirement) you'll need to adjust the Employment Income for the new retirement age manually.
Ensure any contributions or withdrawals that were manually added to capital assets are cleared if they're no longer relevant. This may involve stopping savings contributions earlier or extending them longer.
If the CFM Start Age has changed, you may need to update the After-Tax Spending target for the client.