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You have to be careful not to expose your retirement assets to a new business venture at a stage in your life when you don’t have time to rebuild your nest egg

Time for a second career?



You’ve retired - congratulations! So are you thinking about going back to work? “When seniors go back to work I find that it’s often not for financial reasons,” says Chartered Accountant Gordon Stockman, Vice-President of Efficient Wealth Management in Mississauga. “They’ve already confronted retirement and have given up the paycheque. So they can look in the mirror and know they are working because they want to.”

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Others return to work to supplement their retirement nest egg. “Many decide to start working again because of the economic realities they face,” says Chartered Accountant Brian Clarence of BDO Canada LLP in Mississauga. “Others go back because it is an opportunity to do something new. After all, you can only play so much golf.” If you are retired and considering going back to work, think about whether you want to be your own boss or would prefer a more traditional work setting. “Going back to a more traditional workplace is less stressful,” says Stockman. “Starting your own business is never easy, and you may end up working longer hours than you did before.” Pursuing a second career in a traditional setting also offers more financial stability. “You have to be careful not to expose your retirement assets to a new business venture at a stage in your life when you don’t have time to rebuild your nest egg,” cautions Clarence. If you do return to work after retirement, take steps to minimize your taxes and maximize your savings. “If you have a high income, consider self-employment or returning to work on a contract, because it is more beneficial from a tax perspective,” says Stockman. “If you haven’t had a history of contributing to Registered Retirement Savings Plans, you may also want to re-evaluate that.” If you are eligible to collect a pension, be sure to look into how income from a second career might affect your benefits. “As you make money on top of your pension, there may be clawbacks of your personal exemptions or credits, which means you may not be making as much money as you thought,” says Clarence. You may also wish to defer taking your pension benefits to avoid paying tax on them. Whatever type of second career you choose, be sure to seek advice from a Chartered Accountant. “A CA can discuss the feasibility of a new venture or career,” says Clarence. “If you decide to start your own business, a CA can also help you develop a business plan and structure the new enterprise.” A CA can also help with financial and tax planning. “Your CA will add up your expenses and revenues, look at the tax consequences and help you organize your affairs accordingly,” says Stockman. Brought to you by the Institute of Chartered Accountants of Ontario


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Inst. of Chartered Accountants -- Bio and Archives

The Institute of Chartered Accountants of Ontario is the qualifying and regulatory body of Ontario’s 33,000 Chartered Accountants and 5,000 CA students. Since 1879, the Institute has protected the public interest through the CA profession’s high standards of qualification and the enforcement of its rules of professional conduct. The Institute works in partnership with the other provincial Institutes of Chartered Accountants and the Canadian Institute of Chartered Accountants to provide national standards and programs that are used as examples around the world. </em>


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