FP Answers: What's the best way to draw down our assets in retirement if we don’t want to leave a large inheritance?

financialpost.com:

By Julie Cazzin with Allan Norman

Q: My wife Andrea, 56, and I, 60, have enough resources to retire and be financially secure through any reasonable life expectancy, but we are seeking some advice on asset de-accumulation and which types of investments and assets to melt down — and in what order and when — all with an eye to doing so in a tax-efficient way. We want to model our spending using the retirement philosophy: the Go-Go phase (ages 55 to 69, when people are more physically and mentally active); the Slow-Go phase (ages 70 to 85, when retirees generally slow down); and the No-Go phase (when age plays a big role in slowing down mental and physical activities and some level of care/support is needed). We roughly projected that we would spend $115,000 annually until I am 74 years old, then $90,000 annually until I am 80 and then $70,000 annually after that. We don’t want to leave a big estate.

Our assets include a $950,000 home, which we plan to sell within five years when we move into our second home, worth $400,000. We also have $1.3 million in a non-registered account, $230,000 in tax-free savings accounts (TFSAs), $1.36 million in a registered retirement savings plan (RRSP) and $875,000 in a holding company. As well, my wife has an indexed pension of $66,000 annually, dropping to $52,000 at age 65.

FP Answers: Seeking and receiving financial advice before knowing your future lifetime spending pattern can lead to inappropriate advice. Of course, it’s almost impossible to predict future spending, which makes retirement planning more akin to project management, meaning you are constantly dealing with change.

This is why I am not a big fan of goals-based planning. Goals are hard to identify and often change. A