Aug. 24: BEST OF THE BLOGOSPHERE

August 24, 2026

Experts warn: don’t bank on the value of your house to fund your retirement

If you are banking on the value of your house being a way to fund retirement, be careful, warns Brett Surbey, writing for Money Canada.

He begins by saying that home ownership is a legitimate sign of “financial success for many Canadians.” And, he adds, “across many prosperous nations, Canada included, owning your own home is a sign of wealth accumulation and a concrete marker of financial security.”

The rising value of homes, he continues, may be translating to a rise in individual net worth in Canada. “According to Statistics Canada’s Financial Security Survey, the net worth of individuals aged 55 to 64 between 1999 and 2023 nearly doubled on average — it increased by 91 per cent. And most of that wealth is locked in a home with plans for retirement, experts Colin Busby and John Stapleton noted in a Globe and Mail opinion piece,” he writes.

Next, Surbey points to recent research from the Healthcare of Ontario Pension Plan (HOOPP) that found “that 62 per cent of respondents viewed their home as a `key part of their retirement plan.’ And 44 per cent of those surveyed said they were relying on the sale of their home to fund their golden years.”

But this `key part of their retirement plan’ comes with a few ifs and buts, Surbey notes.

“Unlike funds in a registered retirement savings plan (RRSP) or a pension plan, selling a home comes with additional title, legal and realtor fees alongside other costs that can erode your equity. Additionally, moving is a major point of disruption — you’ll need to make new friends, find a new doctor and fit into a new community,” he writes, citing Busby and Stapleton’s Globe article.

Another concern is that given the rising costs of housing, finding someone from a younger generation to buy your home may prove more difficult than in the past, Surbey reports.

“A study from the Fraser Institute reviewing housing affordability over the years found that the typical home in every major Canadian city was out of reach for families making the local median income. Meanwhile, the latest homeownership data on millennials in Canada from StatCan reveals that this demographic was twice as likely to be living with their parents compared to baby boomers at the same age in 1991,” he writes.

“If younger Canadians can’t afford homes, future demand could weaken, making it harder for today’s soon-to-be-retirees to cash out at the prices they’re expecting and accomplish their retirement goals,” he points out.

OK – if selling your home to fund retirement is a no-go, what about borrowing against it? Let’s read on.

“From another angle, it may be tempting to access home equity with a home equity line of credit (HELOC) or reverse mortgage rather than selling. However, experts have pointed out that this avenue comes with its own share of risks. For example, reverse mortgages often come with higher interest rates and there can be limited offerings to make use of,” he tells us.

For those thinking of leveraging their homes to fund retirement, Surbey concludes by suggesting they consider other funding avenues – registered retirement savings plans (RRSPs), Tax-Free Savings Accounts, employer pensions, and government retirement benefits.

Whatever route you take, he adds, have a plan mapped out, start small, make your money work for you via investments (and not just simple interest), and be sure to take advantage of any retirement program you can sign up for, especially if it includes employer matching of contributions.

The Saskatchewan Pension Plan has been helping Canadians save for retirement for over 35 years. Any Canadian with available RRSP room can take part, and you can contribute any amount up to your annual RRSP limit. If you have other non-locked-in RRSPs, you can transfer them into SPP to consolidate your nest egg.

SPP then invests your contributions in our low-cost, professionally managed, diversified pooled fund. At retirement, options include the security of a lifetime monthly annuity payment or the flexibility of the Variable Benefit.

Check out SPP today!

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