Can Abby live comfortably while saving for retirement if she has no work pension and her spousal support payments end when she’s 65?

The Globe and Mail – By Dianne Maley

At the age of 50 and recently divorced, Abby is making independent financial decisions for the first time in her life. She knows what she has to do.

“I’m trying to learn about finances and investing, and I need to come up with a stepped plan that will help me live a balanced life now while saving and investing for retirement,” Abby writes in an e-mail. She has no work pension. Her spousal support payments will end when she is 65.

She has two children in their 20s, the younger of whom is living at home and going to university. When her son graduates in a couple of years, the family house will be sold and the proceeds divided between Abby and her former husband.

In addition to the family home, Abby and her ex-husband jointly own a company. Under the settlement, he will buy out her share over 15 years. Abby herself has a small business teaching pottery classes, which brings in about $10,000 a year.

“I would like to retire with modest income and be able to travel and enjoy the simple life and live within my means,” Abby writes. Soon, though, she will need to find a place to live.

We asked Ian Black, a fee-only financial planner at Macdonald, Shymko & Co. Ltd. in Vancouver, to look at Abby’s situation.

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