Retirement planning at age 50
At fifty, you are probably at the peak of your career and own your own home. The priority should be not to retire with debt. But does that mean you should spend your money paying off debt? Not exactly. Maintain those monthly installments and increase your investments in growth and high-yield stocks.
Yes, you’re not getting any younger. But you do have the financial ability to take risks, because you are no longer dependent on your investment income as you would be after retirement.
Maximizing a Registered Retirement Savings Plan (RRSP) may seem like the best option. However, only contribute what you need for tax savings. Make the most of your Tax-Free Savings Account (TFSA), as this is the account that will help you preserve your government pensions and save you from the taxman. TFSA withdrawals are not included in your taxable income and are therefore excluded from means-tested government benefits such as Old Age Security (OAS).
Here’s how much 50-year-old Canadians need to retire at age 65
There is no one-size-fits-all figure for how much money you need to retire comfortably. However, there are some popular rules you can use as a benchmark to set a goal:
- Replace 70% of your pre-retirement income with investment income to maintain your current standard of living. If a large portion of your current expenses involve mortgage and other debts, make sure you pay them off before retirement.
- The 4% withdrawal rule says you should withdraw 4% of your savings in the first year and adjust for inflation for about 25 years.
So if you currently earn $100,000/year, you need an annual investment income of $70,000/year, which requires a retirement portfolio of $1.75 million, of which 4% is $70,000.
Now Canada Pension Plan (CPP), OAS and Guaranteed Income Supplement (GIS) will give you almost $17,196 in annual income in 2025 if you take into account the maximum CPP.
In 2023, people aged 45 to 54 had an average RRSP and TFSA balance of $58,374 ($48,374 + $10,048), according to Statistics Canada data. Assuming this balance increases to $75,000, you would need to invest $4,500 per month to have a portfolio of $1.75 million. This assumes that your portfolio grows by an average of 8% annually.
So to answer the question, you need $75,000 in RRSP and TFSA and a monthly investment of $4,500 at age 50 to retire comfortably at age 65.
Which shares you should invest in which account
You have no control over the CPP and OAS payout, but you do have control over the RRSP and TFSA payout. Consider investing in it Kinross Gold (TSX:K) and Constellation software through your TFSA. Gold prices are rising amid war and geopolitical tensions. Gold prices will continue to rise throughout the year as geopolitical tensions escalate, and Kinross Gold will benefit.
It has an all-in sustaining cost (AISC) of $1,622 per gold equivalent ounce, and gold is trading at $4,583 at the time of writing this article. The miner has used this cyclical rally to pay down debt and reach a net cash position of $485 million. Earnings per ounce in the third quarter of 2025 rose 54% year over year, faster than the 40% increase in the average realized gold price. The fourth quarter was stronger than the third, meaning higher free cash flow, dividends and a rising share price.
However, Kinross Gold is a cyclical stock and not something you can hold for fifteen years. That means you may have to book profits and reinvest the money elsewhere when the economy stabilizes. Until then, stocks can grow your money by more than 8% and accelerate your retirement portfolio.
For your RRSP, you can consider investing in dividend stocks with a yield of, for example, 8% or higher Telus. Consider reinvesting this dividend to take advantage of the power of compounding.
Takeaway for investors
Low-yield RRSP dividend stocks can be balanced against high-growth TFSA stocks, ensuring an average 8% return on your portfolio.
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