August 29, 2022

Inflation “stoking fears” about retirement among Brits: study

The decades-high level of inflation is driving a wave of “retirement anxiety” in the United Kingdom, a new study has found.

The study is covered in an article in The Independent, posted on the Yahoo! site.  

The study, carried out for arbdn, an asset manager, found that “54 per cent of over 40s already feel anxious about retirement,” and that those aged 40-44 are even more worried about retirement, with 61 per cent experiencing anxiety.

What are they worried about?

The article cites general worries about “rising bills, inflation, and not having enough in their pension pots.” Other concerns about retirement included “being labelled ‘old’ or losing their identity when they stop working.”

“Retirement anxiety is an emotion of concern or worry, experienced by people yet to retire, about the prospect of retirement,” psychologist Dr. Linda Papadopoulos tells The Independent. “This could be a concern about how they will fill their time, financial worries or perhaps feeling a loss of identity.”

The article suggests that inflation – which is higher than in Canada, having crashed through the 10 per cent barrier there – is driving the wave of anxiety.

Next, the article offers up some things that folks in their 40s can do now to help address the new problem of retirement anxiety.

First, The Independent reports, is the need to plan.

“No matter how many years or decades you are from retiring, it’s never too soon to start planning,” the article suggests. In the story, Dr. Papadopoulos suggests people start thinking about the financial health the way they think about their physical health.

“It’s interesting that when it comes to our finances, we don’t take many steps to help protect our future self,” she states in the article. “I’d encourage people to think about their new beginning (in retirement). What do they want to learn, what might they have not focused on due to work that they could now focus on?”

Other steps the article suggests are seeking the help of a professional financial adviser, and also to “focus on the positives” of retirement.

“Often people are afraid about getting old, feeling lonely and struggling to make ends meet, but there are so many positives to retirement too,” states psychotherapist Lindsay George in the article.

“You will have more time to explore new hobbies, try new things and reconnect with old friends. Rather than seeing retirement as cutting off your possibilities, you could look at it as an opportunity for you to make more new opportunities in your life,” she tells The Independent.

The article concludes by suggesting that continuing to work past usual retirement age – or working part time – is a way to address fears about having enough money. Another important step is to talk about your retirement fears, either with friends or family or a mental health professional, to help address any “irrational thinking” your anxiety may have created.

It goes without saying that the financial side of retirement needs to be addressed. If you are among the minority of Canadians with a workplace pension plan, you are ahead of the game on the retirement income front. If you don’t have a plan, and are facing the prospect of saving and investing on your own for retirement, consider the Saskatchewan Pension Plan. SPP will help you grow your savings through low-cost professional investing, and at retirement, you’ll have the option of receiving one of several lifetime annuity options. Check out SPP today!

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Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.

Dr. Seuss tells the tale of “obsolete children” as they get old

August 25, 2022

It came us a great surprise to Save with SPP that prolific children’s writer Dr. Seuss had once taken a shot at a book for seniors about getting old.

You’re Only Old Once: A Book for Obsolete Children was published by Random House in 1986.

It takes a humourous look – a rhyming look, of course – at some of the things we “obsolete children” have to go through on the back nine of life.

It begins with our hero, a rather tired looking white-haired gent with a moustache, wishing he could be in a faraway land he is reading about in National Geographic, rather than being “here in this chair in the Golden Years Clinic on Century Square for Spleen Readjustment and Muffler Repair.”

The hero, not feeling his best, has come in “for an Eyesight and Solvency Test.”

The Quiz-Docs, he learns, will “start questionnairing”. They’ll ask you, point blank, how your parts are all faring…did your cousins have dreadful wild nightmares at night? Did they suffer such ailment’s as Bus Driver’s Blight, Chimney Sweep’s Stupor, or Prune Picker’s Plight?”

Next, we learn, after losing “both your necktie and vest… an Ogler is ogling your stomach and chest.”

Soon there are more Oglers ogling more of you, the book tells us. “The Oglers have blossomed like roses in May. And silently, grimly, they ogle away.”

After a nervous wait, our hero is off to get his hearing tested. He is off “to a booth where the World-Renowned Ear Man, Von Crandall, has perfected a test known as Bellows and Candle. If the wind from the bellows can’t blow out the flame, you’ve failed — and you’re going to be sorry you came.”

That’s because failing the test means “you’ll be told that your hearing’s so murky and muddy, your case calls for special intensified study.” After listening to “noises from far and from near,” and getting “a black mark for the ones you can’t hear,” it’s back to the waiting room with the waiting room fish, Norval.

Our hero is ultimately wheeled past “Stethoscope Row” where he will later get “stethed with some fine first-class scoping.” But first, there’s the Allergy Whiz and more tests, and then to the Dietician.

“And when that guy finds out what you like, you can bet it won’t be on your diet – from here on, forget it,” our hero learns. After getting prescribed a plethora of coloured pills, our hero (this being in the U.S., we presume) then is asked that “a few paper forms… be properly filled so that you and your heirs may be properly billed.”

But, there’s a happy ending – after all the tests, ogling, prodding and pills, our hero is “in pretty good shape for the shape you are in.”

For those of us who are indeed frequent flyers at the blood-test clinic, known by first name at the pharmacy, run into aging peers at the gym and peer at tiny-print food labels to double check sugar and sodium levels, this book is a very funny, rhyming look at the reality of seniorhood. It’s well worth a trip to a bookstore or library!

When seniors aren’t talking about their health, they’re talking about how the cost of everything is going through the roof. Us retired boomers remember when gas was 77 cents a gallon, or about 20-odd cents per litre, and it’s now gone up ten times that price. The same’s true for the 10 cent bottle of pop and the 25 cent loaf of bread. Inflation’s been here for years, sometimes high and then low, and where it will lead us, we really don’t know. The best defence against a rising cost of living is having retirement savings. If you are fortunate enough to have a workplace pension, you have a leg up. If you don’t, a fine do-it-yourself option exists via the Saskatchewan Pension Plan. You provide the dollars, and SPP provides the low-cost investment management to grow those dollars into future retirement income. Check them out today!

Join the Wealthcare Revolution – follow SPP on Facebook!

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.


August 22, 2022

U.S. study links health, happiness to sound financial planning

We’ve often heard how things like rising interest rates and market volatility “keep us up at night.”

But, reports Gabrielle Olya, writing for GoBankingRates via Yahoo!, a new study out of the U.S. suggests that there’s actually a link between having a good financial plan and happiness – as well as being able to sleep at night.

The Northwestern Mutual 2022 Planning & Progress Study found that “people with financial plans and those who work with financial advisors are happier and sleep better than those who don’t plan or work with advisors,” she writes.

The numbers she reports on from the study are indeed eye-openers.

“Eighty-seven per cent of Americans surveyed who work with financial advisors reported that they are very or somewhat happy, as did 84 per cent of those who considered themselves disciplined planners,” the article notes. Those numbers drop to 72 per cent for those without financial planners and to 68 per for those who aren’t following a plan.

And then there’s the whole sleep thing.

“Eighty-one per cent of Americans who work with financial advisors said they sleep well or very well, and 76 per cent of disciplined planners said the same. Among people who don’t work with financial advisors, 65 per cent said they sleep well or very well, and that percentage dropped to 62 per cent for informal planners and non-planners,” Olya writes.

“As we dug into the results, we saw that people who have an advisor or identify as a disciplined planner reported being happier and sleeping better. This signalled to us that there is a clear link between financial wellness and overall wellness,” states Northwestern’s Christian Mitchell in the article.

He further states that having a plan and/or working with an advisor “eliminates a lot of the uncertainty surrounding your finances and allows you to feel more confident about your complete financial picture. This clarity can help create peace of mind and even lead to increased happiness and better sleep.”

The article concludes by outlining some steps those of us who aren’t using an advisor, or following a plan, can take – “setting a budget, reducing spending or paying down debt.” As well, focusing on long-term goals – “such as buying a house or saving for retirement” can be a positive step.

Perhaps we can take away from this article – thinking chiefly of retirement savings – that those of us who have either a plan or a strategy for handling this long-term goal may feel happier/healthier than those who don’t have a plan.

As we’ve seen, the majority of Canadians don’t have any sort of workplace pension or retirement arrangement. That means the responsibility for retirement savings falls squarely on their own shoulders. If you want someone to help carry the ball for you, consider the Saskatchewan Pension Plan. Through SPP’s open, voluntary defined contribution model, you contribute the savings, and SPP takes on the tricky part – investing your money, growing it, and getting ready to turn it into future retirement income. Leave the heavy lifting and stress to SPP; get them working on your retirement strategy!

Join the Wealthcare Revolution – follow SPP on Facebook!

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.

A look at things you can do to feel a little younger

August 18, 2022

You feel it on the dog walk, on the dance floor, or on the golf course. That knee is a little stiff, that back is a little achey, you’re feeling a bit low energy… the list goes on. What can those of us of a certain age (advanced) do to combat against the feeling that we’re turning into an old car in dire need of a trip to the auto mechanic’s? Save with SPP took a look around to get some answers.

The Huffington Post basically advises us oldsters to snap out of it, and not give in to aging. Develop, we are told, a positive mental attitude about aging, and look forward to life ahead at 75, 85 and beyond. “Don’t act your age,” the Post advises. “The key to psychological health is how you feel inside, not your chronological age or your physical appearance,” the article notes.

“Feeling old is a self-fulfilling prophecy. For example, if a person genuinely feels too old to do a physical activity, such as hiking a mountain, she is apt to cut back on the activity. Once she does, her muscles will start to shrink from lack of use, and her bones may get smaller, and she may cut back her activities even more,” the article warns.

“Avoid this rut by continually doing things like exercise as you age. You are as young as you feel,” the Post tells us.  The Post also thinks we should keep active, even continuing to work after retirement age. “Work, actual or volunteer, is in part what keeps people living to advanced ages. If your full-time career is too taxing, consider working part-time, switching to a less stressful job, or volunteering,” the Post reports.

A final key point was “seeing aging as an opportunity,” the article states.

“Those who believed aging was no big deal were able to climb stairs, do housework, work full-time, go out socially, and do other activities associated with younger people. And they lived 7.5 years longer than those with less positive ideas about aging,” the article notes.

At the Stay Young Healthy blog there are 10 ideas for youthfulness on offer.

The blog advises us to exercise every day.

“For staying young, you have to leave your comfortable life and get into the habit of working out daily… just go for a morning walk for 30 minutes, do jogging in an open area or run for 20-30 minutes daily,” the blog advises.

Other ideas include a balanced diet, making sure you are a healthy weight, and reducing stress, the blog adds.

The VitaMedica blog offers up 20 tips on how to look and feel younger, including staying out of the sun, drinking plenty of water, avoiding tobacco, alcohol and caffeine, and having a planned “de-stressing” time.

“Staying young means stressing less. Set aside a small chunk of time every day, about 10-20 minutes, to relax, meditate, or just breathe deeply, while letting worries melt away and helping yourself look younger naturally,” the blog advises.

So, what we’ve learned here is that a lot of the downside of aging is having a negative attitude about it. Rather than regretting the passage of time and wishing we were young again, better to enjoy how we are and work on keeping our bodies and minds active and out of the sun. Less is more when it comes to smokes, booze and java.

There’s no stress worse than work-related stress. We found yoga was a great way to give your mind and body a mid-week vacation from meetings, deadlines, project plans, and “deliverables.” The advice of having 30 minutes set aside daily for exercise is also very astute.

Stress about money is probably on the top 5 list of worries as well. You can ease your future mind by putting away some money today for your retirement tomorrow. The Saskatchewan Pension Plan has been busily building retirement nest eggs since 1986. They’ll invest your contributions professionally, at a low cost, and will help turn your savings into future retirement income. Check them out today!

Join the Wealthcare Revolution – follow SPP on Facebook!

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.


August 15, 2022

Is inflation eating up Canadians’ COVID-19 savings?

Back when COVID-19 restrictions had many of us sitting at home with little to spend our money on, economists and financial observers began talking about how the barriers to spending (no travel, fewer goods and services to buy) would create a monster pandemic savings pot.

And they were right, it did. But now, reports Jason Kirby in The Globe and Mail, that giant horde of unspent cash could be getting devoured by an unexpected new entity – inflation.

“Average household net savings fell 44 per cent to $1,900 in the first quarter from the year before, according to Statistics Canada’s latest release of household economic accounts broken down by income and age,” he writes. While all income groups saw their savings fall, the article notes that those with the lowest incomes saw the biggest decline.

A graph in the article shows that as recently as spring of 2020, the average Canadian household had upwards of $5,500 in savings. That means we’ve experienced a drop of nearly two-thirds in household savings.

The article says that the savings dip is not totally bad news.

“The good news, as far as spending continuing to fuel the recovery, is the average household still has more savings than they did before COVID-19 hit and governments ramped up income support programs,” the article tells us. “Stats Can data show the average household still holds 63 per cent more in net savings than before the pandemic, even though that amount has shrunk by more than two-thirds since the second quarter of 2020,” the piece reveals.

But while the wealthier among us “have a far better ability to absorb the shock of rising prices for goods and services,” lower-income folks are having a far tougher time.

For the lowest income bracket, the article notes, “the average household in that group has negative net savings — meaning they spent more than their disposable income — and are further behind than they were before the pandemic.”

Falling into a situation where you spend more than you earn – and are living on debt – is made even more perilous by those rising interest rates, reports The Financial Post.

“Canadians who took out mortgages for 4.5 times their gross income — a not uncommon practice when housing prices shot up during the pandemic — could see payments increase by $187 to $281 from 2022 to 2024, which would absorb as much as 2.6 per cent to four per of their net income,” the article states, quoting a recent study authored by National Bank of Canada economists Matthieu Arseneau and Daren King.

So the takeaway here is that we all need to try our best – and it isn’t easy when gas hits more than a toonie per litre – to live within our means, and avoid living off credit lines and cards. The days of cheap money thanks to decades of low interest rates have ended, at least for now.

The growing inflation rate also underscores the need for retirement savings. Your future you will need more, not less money should the trend towards higher costs continue on into the future. A great partner for retirement savings – one that is open to all Canadians with registered retirement savings plan room – is the Saskatchewan Pension Plan. Check them out today and see how they can help you build, a grow, a retirement nest egg!

Join the Wealthcare Revolution – follow SPP on Facebook!

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.

Answering the age-old question – what retirement has been like?

August 11, 2022

We are frequently asked by former colleagues and friends still labouring in the workplace what retirement is like. It’s a somewhat difficult question to answer, but Save with SPP will give it a whirl in the hopes it helps others plan things out.

It seems impossible to imagine not working when you are, in fact, working. We think of vacation or long weekends as “time off,” but with all of those there is that last-day little ripple of dread – oh dear, one more afternoon in the sun and it’s back at work. So, retirement is not like that.

We had a lot of adjustments to make to transition from full-time work to receiving a pension and working as a freelancer. First, there was shutting down the rental condo in T.O. that was needed for this guy to work in Toronto during the week and be home in Ottawa for the weekends. We bought in Ottawa and rented in Toronto. So, retiring from the Toronto job meant packing up the little condo, giving notice, disconnecting cable and phone, and ending years of frequent train travel between points. That was a huge savings in our monthly budget – we went from two of everything to one of everything.

That helped, because even a very good pension only provided about half of what we had made at work. Getting less to live on was hugely offset by a drop in living costs; we were lucky in that regard to have had a very good work pension from the Healthcare of Ontario Pension Plan.

The boss retired from working at an Ottawa hospital the next year, but at time of writing is still working at a different hospital.

The Saskatchewan Pension Plan figures into both our retirement plans, and here’s how.

When we bought the house in Ottawa, we were engaged but not yet married, and that allowed us to take part in the Home Buyers’ Program. While looking around for a place to repay the money we had withdrawn for the house, we discovered an article by our friend Sheryl Smolkin, and loved the idea of a plan that resembled a registered retirement savings plan (RRSP) but had the additional extra feature of an annuity. The fact that it was not-for-profit and had far lower fees than a retail mutual fund was another sell. So, this guy was in.

Our own SPP account now represents more than twice what we took out for the house, and we add to it annually. Once we are fully retired – maybe in five years – we’ll start collecting it!

The boss soon found that working three or four days a week AND drawing a pension created a big of an income tax headache – the paying kind. So, we got her to sign up for SPP, and began contributing annually while also transferring money in from her various RRSPs. The tax-deductible SPP contributions fixed a tax problem and helped turn balances owing into refunds.

When she retires in February, part of her retirement earnings will be a monthly SPP annuity of about $500. That’s going to be a big help for her, as it will add to her retirement earnings and narrow the gap between what she made before she retired and what she is making after.

We have learned a few important things in this process.

  1. When comparing your before-retirement income to your after-retirement income, be sure to do a net-to-net comparison, not gross to gross. Why? If your income goes down, so do your taxes – so the perceived “gap” may be less than you think. As well, you may not be paying for the Canada Pension Plan anymore, or other payroll deductions like union dues, parking, and so on. Net to net.
  2. You’re likely only going to get a pension payment once per month. If you are used to getting paid monthly, you’ll be fine. It takes some getting used to if you were paid twice a month or every two weeks. Adjust your thinking accordingly.
  3. Your stresses will change, but probably won’t disappear. Instead of worrying about meetings, promotions, career changes, traffic and so on you’ll find you are more focused on family, taking care of the old ones and helping the young ones. No meetings, sure, but still things to worry about.
  4. You have time to learn new things. We’re line dancing, and this guy is golfing more and actually getting better on guitar. The line dancing has led us to meeting new people and we’re going on a trip to Nashville in the fall. So, make sure you are still doing something that allows you to have new social contacts in your life.

We conclude by noting that retirement almost seemed scary when we were working. No more structured workweek with meetings, assignments, annual reviews, and the like. Those things definitely required attention in the past, but now there are new and more interesting things to focus on. So, don’t be afraid of life after work.

Join the Wealthcare Revolution – follow SPP on Facebook!

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.


August 8, 2022

Do old boomer money rules make sense for the young?

Some of the old tried and true money rules us boomers have long lived by may not hold up for younger generations.

An interesting article by Alison MacAlpine in the Globe and Mail casts doubt on the relevance, for today’s young people, of some of the old boomer money beliefs.

“Save 10 per cent of what you earn, invest 70 per cent in stocks and 30 per cent in bonds and keep six months of expenses in an emergency fund. Rules like these worked well for many baby boomers, but don’t necessarily apply to younger generations,” she writes.

Her article quotes Julie Pereira, of Edward Jones, as noting the old boomer “how-to” axioms followed the belief that life would unveil itself in a very specific, predictable order.

“Older generations would have an order of operations on how they wanted to do things – get married, buy a house, have children, save for retirement. Now we’re seeing that be more fluid,” Pereira states in the article.

Home ownership, the article continues, may be less of a priority for younger folks given the “eye-watering prices, rising interest rates and high levels of student debt.” Saving for retirement, the article warns, may also have “dropped down the list” for younger folks, replaced by “saving for a series of sabbaticals or travel breaks from work.”

The article suggests that another old boomer retirement target – having 70 per cent of your pre-retirement income as retirement income once you are 65 – may no longer work, given that many people plan to work longer or have more expensive plans for when they retire.

The article casts doubt on what our Uncle Joe used to say – bank 10 per cent of what you make and live on the rest.

“As for saving 10 per cent from every paycheque, that may not work for people with fluctuating salaries. Sometimes they’ll need to use everything they earn, and at other times they’ll be able to save more than 10 per cent,” the article states.

As for the investing rules of thumb, states Rod Mahrt of Victoria’s Wellington-Altus Private Wealth in the article, “we reached the conclusion that the traditional 70/30 (equity/fixed income) asset allocation that worked so well for past generations is not going to work for today’s generation. It’s not going to work for the next 30 years. It’s not even going to work for the next 10 [years].”

Mahrt tells the Globe that bonds have had a rough patch of late, and that there may be safer investment havens with real estate, infrastructure and “low volatility hedge funds.” Today’s young investors may also be interested in “purpose-driven” investments that benefit society or the environment.

The article concludes by saying that while some elements of the boomer plan – like having an emergency fund – still make sense, it’s important for boomers to share their money experiences with their kids (good and bad) so they can develop their own plans based on their own needs and today’s market and economic conditions.

The key takeaway, at least from a boomer perspective, is that having an individualized plan is better than going by rules of thumb. The article stresses the importance of getting professional help with money management, which is also good advice.

If mom and dad’s money rules don’t work, the article suggests, develop some of your own rules that do.

Putting off retirement saving until later can work, but you’ll have to put away a lot more in the run-up to retirement than you will when it is three or four decades down the road.

If you can’t afford an Uncle Joe 10 per cent rule, try five per cent, or two per cent. Start small and ratchet up when you can. Investing for retirement is a long-term proposition so the earlier you start, the better, even if it is with a relatively small monthly contribution.

Managing the investment of your retirement savings is something that the Saskatchewan Pension Plan can do for you. SPP’s Balanced Fund’s asset mix is frequently adjusted to keep your savings growing regardless of market ups and downs. Check out this made-in-Saskatchewan retirement savings solution today!

Join the Wealthcare Revolution – follow SPP on Facebook!

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.

Some common RRSP mistakes we all need to avoid

August 4, 2022

Those of us who don’t have a workplace pension – or want to augment it – are pretty familiar with what a registered retirement savings plan (RRSP) is. However, there can be tricky things to watch out for when investing your RRSP savings. Save with SPP had a look around the Interweb to highlight some RRSP pitfalls.

The folks at Sun Life identify five RRSP no-nos. First, they tell us, is the mistake of putting cash in your RRSP to meet the deadline, and then not putting it into an investment of some kind. Be sure you invest the money in something – “stocks, guaranteed investment certificates, mutual funds, bonds and more” so that your RRSP contributions grow. Your money grows tax-free until you take it out, so you need to have growth assets, the article says.

Another problem identified by Sun Life is raiding your RRSP cookie jar.

“Making RRSP withdrawals before retirement to, say, cover bills or make big purchases can have lasting consequences. For one, you’re giving up the years of tax-deferred growth your money would have generated inside your plan.” As well, the article continues, you’ll face a double tax hit – a withholding tax is charged when you take money out of an RRSP, and then the income from the withdrawal is added to your overall income at tax time. Double ouch.

Other things to watch out for, Sun Life advises, are overcontributing (be sure you know exactly what your limit is), spending your tax refund instead of re-investing it, and not being aware of RRSP/RRIF tax rules on death.

The Modern Advisor blog cautions folks against making their RRSP contributions “at the last minute.” If you spread your contributions out throughout the year, you will get more growth and income from them, the article advises.

Other tips include making sure your beneficiary selection is up to date, and knowing that contributions don’t have to be made in cash, but can be made “in kind,” such as by transferring stocks from a cash account to an RRSP account.

The RatesDotCa blog adds a few more.

On fees, RatesDotCa points out that many RRSP products, typically retail mutual funds, charge fairly hefty fees. “Canadians pay some of the highest fees in the world,” the article notes. “Over many years, these fees can add up, further reducing your retirement plan. Be sure to ask for a thorough explanation of the fees you can expect, and how they will affect your retirement plan,” the article advises.

Other ideas from RatesDotCa include not repaying your RRSP if you do borrow from it, not taking “full advantage” of any company pension plan (meaning, contribute as much as you can to it), and retiring too early (the article notes that both the Canada Pension Plan and Old Age Security pay out significantly more if you wait until age 70 to collect them.

Save with SPP can add a few more, gleaned from our own “welts of experience” over 45 years of RRSP investing.

Don’t frequently move your RRSP from one provider to another. This is called “churn,” and can result in hefty transfer fees and generally reduces the long-term growth needed for retirement-related investing.

If you borrow to make an RRSP contribution, do the math, and make sure the loan amount is affordable. Sometimes the bank or financial institution will want the money repaid within a year.

Be sure your investments are diversified, and include both equities and fixed income, plus maybe alternative investments like real estate or mortgage lending. Typically, if one sector is down, others may be up.

If you don’t want to think this hard as this about RRSP investments, consider the Saskatchewan Pension Plan. Contributions to SPP are treated exactly like RRSP contributions for tax purposes. You can’t run into tax trouble by raiding your SPP account because contributions are locked in until you reach retirement age. SPP offers a very diversified portfolio in its Balanced Fund, and fees charged by SPP are low, typically less than one per cent. Since its inception in 1986, SPP has averaged eight per cent returns annually – and although past results don’t guarantee future performance, it is a noteworthy track record. Check out SPP today!

Join the Wealthcare Revolution – follow SPP on Facebook!

Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.


August 1, 2022

More had pension coverage in 2020, but six in 10 don’t: Statistics Canada

New research from Statistics Canada shows that 57,000 more Canadians had registered pension plans in 2020 than in 2019, reports Investment Executive.

However, the article notes, 2020 – the first year of the pandemic – saw fewer workers overall due to COVID-19. So while a greater percentage of workers had pensions, the overall worker pool actually shrunk that year, the article notes.

Let’s dig into the other findings.

“Nearly 6.6 million Canadians had a registered pension plan in 2020, up by 57,000 (0.9 per cent) from 2019,” Investment Executive reports, citing Stats Canada data.

“The increases came in Quebec (33,000), Ontario (25,200) and British Columbia (16,800), while fewer workers in Alberta (-23,400) and in Newfoundland and Labrador (-3,500) had pensions,” the article continues.

Defined benefit pensions – the type where the payout is pre-determined, and is typically a lifetime pension that may offer inflation protection – represented “the lion’s share of pensions in Canada,” the publication notes. 4.4 million Canadians were covered by this type of plan in 2020, the article adds.

Defined contribution pensions – basically capital accumulation plans, where savings are invested and whatever is in the kitty at retirement is turned into income – accounted for 18.4 per cent of all registered pension plan members. The Saskatchewan Pension (SPP) is this type of plan.

Overall, the article reports, “almost four in 10 (39.7 per cent) workers in Canada were covered by a registered pension plan in 2020, up from 37.1 per cent in 2019.”

“The increase in the coverage ratio was due to a decrease in labour force numbers, attributable to the pandemic, rather than an increase in the membership in the registered pension plans,” StatsCan stresses in the article.

Participation in workplace registered pension plans has been in decline generally this century, Investment Executive reports. “This level of coverage was last seen in 2001 (40.2 per cent), then trended downward before having a peak year in 2009 (39.4 per cent), after which point it resumed its downward trend.”

There are a couple of takeaways from this article. First, it suggests that over six in 10 workers in Canada weren’t covered by a registered pension plan in 2020. That’s going to be a problem as more folks without pension coverage at work converge on their retirement years.

On the positive side, these days in the sorta-kinda post-COVID world, employers are finding it harder to attract and retain employees. Many are improving the benefits they offer their teams, including adding or upgrading pension programs. Let’s hope this more positive trend continues.

If you don’t have any kind of pension arrangement at work, fear not. There’s a great do-it-yourself option out there through the Saskatchewan Pension Plan. Any Canadian with registered retirement savings plan (RRSP) room can sign up for SPP, and you can then contribute up to $7,000 annually to the plan. If you have an RRSP, you can move those funds to your SPP account – transfers of up to $10,000 a year are permitted. Your savings are professionally invested at a low cost in a pooled pension fund, and when it’s time to stop the whole work thing, you can arrange to receive some or all of your savings as a lifetime monthly pension via SPP’s annuity program.

Be sure to take a look at what SPP has to offer!

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Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.