Paying for this cruise

Well it is a wet day here in Vancouver so perhaps now would be a good time to post about how I might pay for this once in a lifetime cruise.

I retired at the end of 2006 - well it was a severance as the building was closing for a re-build but with 35 pensionable years and approaching my 60th birthday and a fairly healthy pension entitlement I was set.

Well no need to dwell to much on what has happened to my pension - it has been hurt by the market turmoil and while the income from it and my Canada Pension Plan - similar to Social Security in the US provides enough for the daily pleasures of life - it also has forced me to draw down my reserve funds to pay for my travels the last five years and those have now been depleted.

I still do have funds available in my RRSP - Canadian equivalent to IRA`s but that income is taxable starting at 10% off the top.

I do have a financial planner and will be consulting with him next week as I try to draw up a 3 -5 year plan to include trips, condo assessments for improvement to the building and updating my own condo which has seen nothing since I moved in 6 years ago.

Like Americans we have reverse mortgages and equity line of credits and this is likely where my future finances will come from.

I am fortunate that I am mortgage free and own a small studio apartment in downtown Vancouver - while there has been some softening in the market prices here - it is less than 5% and because of tighter ownership rules and banking regulation we have not been faced with the ugliness of the American housing markets.

Vancouver is also a desired place to live and values are likely to continue to increase into the foreseeable future.

So my apartment is the source of future lending possibilities - being single and no heirs it is easier for me to draw on the value of that asset and it is tax free as well.

The real choice is between taking a reverse mortgage and a higher interest rate and make no payments until the property is sold or a bank home equity line of credit which is currently offered at Prime - 3% in Canada + 0.50% and you make interest payments each month but can also repay the principle if you wish.

This is likely the route I will go - I am only charged interest on the amount actually used not the amount authorized.

Depending on how much I want to use this will allow me to cruise a couple of times a year and will also allow me to start thinking about that next big one EUROPE in 2015.

Next up - how my fear of flying led to a love affair with Amtrak

Cheers

D