May 5: BEST FROM THE BLOGOSPHERE

May 5, 2025

Report recommends we work until 67 before retiring

It’s not necessarily the news we all want to hear, but a new report from the C.D. Howe Institute is suggesting that – for retirement, at least – 67 should be the new 65.

The report’s findings were the subject of an article in the Saint John Telegraph-Journal.

“One of the review’s co-authors admitted that one of their key recommendations would be unpopular – changing pension rules so that older Canadians would have to slog it out longer,” the Telegraph-Journal reports.

C.D. Howe Institute’s Parisa Mahboubi tells the newspaper that “the government needs to inform the public about the benefits of increasing the retirement age.”

“Research shows that people are living longer and are healthier than previous generations, allowing them to contribute more. And if you compare the financial situation of older individuals today, compared to 20 years ago, in terms of the assets and debts that they have, many, many older workers today may need to work longer,” Mahboubi tells the Telegraph-Journal.

Other countries, the article continues, are moving their retirement dates to a later age to address factors like increased longevity. France, the article notes, moved their retirement age to 64 from 62, and Italy from 62 to 63 “before backing down and introducing other incentives to make people work longer.”

In Russia, women are retiring at 60 instead of the previous 55, and men at 65 instead of the previous 55, the article reports.

On the overall scorecard of the 38 most developed nations, the article notes that Canada is in the middle on retirement age and the start of government retirement benefits.

The C.D. Howe report cited early retirement incentives as a reason older workers are leaving their jobs at a time when the employment rate is in decline, the article notes.

“Consider this: Canada had half a million job vacancies in the latter part of 2024, most of them full-time (432,810 positions),” the article notes. “Nearly one-third of those postings were persistent and still available after 90 days.”

“At the same time, the employment rate declined to 61.3 per cent in 2024, down from 62.2 per cent the previous year,” the Telegraph-Journal adds.

Encouraging older people to work longer would address these issues, the study’s authors suggest. The article lists these C.D. Howe Institute recommendations:

• Raising “the normal retirement age” to 67 and delaying pensions until then.
• “Supporting older workers with flexible work, part-time options, and self-employment, especially in the Atlantic provinces.”
• More job training, especially in technology.
• “Streamlining credential recognition and licensure” for skilled immigrants.
• Enhancing settlement strategies for immigrants, including “workplace-focused language training.”

The article concludes with a final thought from Mahboubi – “I’m talking about jobs for some individuals that can change. Part-time jobs or jobs that don’t require significant physical activity, yes, why not? We need to be realistic about the challenges our economies will face with aging and make sure we don’t fall behind other countries.”

On a personal note, we were excited to start our Saskatchewan Pension Plan (SPP) annuity effective May 1, 2025. Our decision to go ahead and select the annuity at this time was based on a number of factors, such as the fact we won’t have a lot of RRSP room in 2025 and beyond, and that markets have been uncertain. We wanted the income certainty of the annuity option, with 100 per cent benefit of the payment continuing to our surviving spouse, because her mom just celebrated her 93^rd birthday. So the little boss will be around for a long, long time.

Check out SPP to learn more about their annuity options and the other choices you can make at retirement, including the more flexible Variable Benefit.

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Saint John Telegraph-Journal

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