Posted By By Mark Seed, myownadvisor
Special to Financial Independence Hub
Unless you go back in time, retirement no longer means stopping all forms of work from the factory job: Retirement means different things to different people.
While there remains a formal definition of retirement (in that there is the action of leaving one’s job or ceasing to work) retirement has many flavours these days. The traditional definition has evolved and no longer fits what people are doing and seeking.
As I approach retirement from my own career at the end of March 2026, I wondered how you intend to retire.
How do you intend to retire?
The rise of standardized work during the 20th century coupled with an abundance of industrialized or corporate jobs gave rise to pension plans as a key employee attraction and retention benefit. So, you worked hard for 30-35 years and then you retired with your pension as part of the long-term total compensation model: a model that remains in place to today.
Defined benefit (DB) pensions give retirees fixed lifelong monthly payments based on salary and a years of service formula. Some DB plans even offer a degree of indexing to fight inflation. But all DB plans represent a premium form of dependable retirement income that is not subject to financial market drama: since the financial risk is on the employer and not on the employee or retiree.
But times are a changing …
The long retreat of DB employee benefits has been well documented, shifts have occurred in the employer-employee dynamic involving unions along with shifts in the job market to industries where a DB pension is simply just not offered.
Canada’s retirement income system is often described as having three pillars, although variations exist.
The first pillar provides benefits based on age and years of residence in Canada: so it includes the Old Age Security (OAS) pension, the Guaranteed Income Supplement ((GIS), if that applies to you for lower-income folks), the Allowance and the Age Credit. This first pillar is funded largely through general tax revenues.
The second pillar consists of mandatory earnings‑related programs so you can put the Canada Pension Plan (CPP) and, in Quebec, the Quebec Pension Plan (QPP) in that bucket. These are public pensions, funded by mandatory contributions from workers and employers, as well as income from investments made with these contributions.
And finally the third pillar is composed of the aforementioned workplace pension or as the workplace employee compensation model continues to shift, it could be a Group RRSP or another form of employee compensation as well. “Private” retirement income planning may also include your own assets: RRSPs, TFSAs, LIRAs and any non-registered investments.
Source: Government of Canada.
I share this information for context when it comes to the following types of retirement you might pursue: how you intend to retire. Your path to retirement could be one or more of these types below.
1. Traditional Retirement
I define this as follows: you work for decades on end uninterrupted and you stop working for good. During this period of time, you might have contributed to a DB or Defined Contribution (DC) pension plan or not at all.
If you had a pension, the automatic savings nature of any workplace pension would be very good for most people — this “forced savings approach” is a huge benefit unto itself – pay yourself first as per The Wealthy Barber.
If you had a pension (the golden handcuffs idea) and depending on the type of pension you have, pension income gets paid out in different ways at retirement. Some plans cannot start before a certain age while others can be accessed earlier. Depending on your retirement-income goals this flexibility (or lack of flexibility) is an important consideration in your financial plan: one I’ve struggled with myself.
There are many benefits to traditional retirement by remaining with one key employer for decades on end (i.e., work stability; the guaranteed pension income for life; don’t have to take too much personal investment risk; could be other workplace retirement benefits like health benefits, travel benefits or life insurance benefits) but traditional retirement also seems to come at a personal cost of trading your life energy for employer time for many decades.
The traditional path to retirement may not work for many people these days. It did not work for me.
2. Semi-Retirement
I define this as follows: you want to pursue some form of life-work balance.
My wife toggled back and forth between full-time and part-time work up until her retirement in October 2025.
I continue to enjoy my part-time role at work (until the end of March 2026): I wanted to remain with my employer for a bit, still contribute, just in a reduced capacity.
After I retire from my current career, I might still work (gasp!) but only a few days per week or a few days per month. We shall see.
I will continue to blog here for another year or so too and this site doesn’t make minimum wage: I enjoy running it.
Semi-retirement is not about income but it may include some small financial compensation for doing something you really enjoy/want to pursue: trading your time or energy for some income.
This path and related definition of retirement has always appealed to me and much more so than just early retirement and not working again.
3. Early Retirement
Some bloggers or FinFluencers might express this is a “better way” to retire but when you really think about it: nobody in their 30s or 40s really retires early and never works again. I haven’t met one of them yet.
They continue to work for some income and many do so on their passion projects. Nothing wrong with that of course, being an entrepreneur, you just need to be honest with folks vs. selling some dream as you hustle a book or a podcast or something else to support your lifestyle.
In Your Money or Your Life, author Vicki Robin equates ample savings (and investments) with freedom. This means you have the freedom “to leave your job if the boss is intolerable or the benefits have just been yanked.” With sufficient savings (and investments) you have the opportunity to transform your life, including achieving Financial Independence if you want to.
Robin likens financially independent thinking to cartography: you need to create your own map. Your map will depict the delta between your life today and the one you want to lead. The results of financially independent thinking will allow you to step back from your assumptions and emotions about money and observe them objectively.
The concepts related to early retirement are not new but certainly lots of modern social media marketing have propelled this thinking into a new discussions and forums.
I’m a big fan of financial independence, just not any Retire-early part of FIRE marketing.
4. Mini-Retirements
Popularized by Tim Ferriss’ 2007 bestseller, The 4-Hour Workweek, Ferriss proposes you redistribute your retirement over many decades. Other books and articles have suggested the same over the years.
In this form of retirement you work in bursts or stints. For example, you might work for a few years and then take a few years off work only to work yet again.
When it comes to mini-retirements, I’ve considered this approach but quickly dismissed it since I was always more focused on my crossover point and becoming financially independent vs. needing to work to fund periodic time off only to work again …
In doing so, that allowed us to start shifting both of our workplace schedules to part-time as part of a transition to retirement sooner than most.
How do you intend to retire?
The answer to this question is very personal and quite subjective.
Which type of retirement is right for you?
“It depends” is the common personal finance answer to pretty much everything but it’s so true.
Traditional retirement never appealed to me nor did any sort of mini-retirement either. So, I guess I’ve opted for the semi-retirement path and if you want to suggest that I’m an early retiree well that’s probably somewhat correct too.
Your financial planning and retirement income planning will depend on many personal factors but the ingredients to any retirement or some form of financial independence are pretty generic:
- Spend less than you make and invest the difference: This obvious expert advice really never goes out of style. A high, consistent savings rate is a get wealthy eventually path to retirement.
- Kill all high-interest debt and remove all debt from you life when you can: Debt management comes in the form of removing ongoing credit card debt, killing off high interest loans, and managing any other consumer debt well. If you are always paying other people first it will be hard to get ahead in life.
- Educate yourself / gain financial literacy over time: Another obvious truth but it’s critical to educate yourself so you develop a better understanding of not only how to manage your finances but also the motivations of others around you. Otherwise, you will pay other people lots of money to do your financial thinking for you.
Leave a comment below. I look forward to your engagement.
Yours in happy planning and celebrations for what lies ahead in 2026.
Happy New Year!
Mark
Source: Carl Richards, Behavior Gap.
Mark Seed is a passionate DIY investor who lives in Ottawa. He invests in Canadian and U.S. dividend paying stocks and low-cost Exchange Traded Funds on his quest to own a $1 million portfolio for an early retirement. You can follow Mark’s insights and perspectives on investing, and much more, by visiting My Own Advisor. This blog originally appeared on his site on Dec. 31, 2025 and is republished on Findependence Hub with his permission.
