Saving for retirement “is only part of the puzzle,” reveals Edward Jones research

Today’s retirees aren’t having an easy time of it like their predecessors, but are dealing with “curveballs, cannon balls and windfalls,” reports a new study carried out by Edward Jones.

The study’s results are covered in a recent article in Wealth Professional.

On the plus side, the findings from the firm’s latest Age Wave study suggest that Canadian retirees are focused on “health, family, purpose and finance,” the article notes.

And, says Edward Jones’ David Gunn, millennials are taking note of how retirees are dealing with post-work life.

“Eighty-five per cent of millennials agree that applying what retirees are learning right now would be helpful to them. So, millennials seem to recognize that retirees are going through a lot right now with respect to retirement plans and they want to learn from them. That’s a really good finding,” he tells Wealth Professional.

However, the study did note that while having goals in retirement is a positive, having a budget is also of critical importance.

“Saving for retirement is only part of the puzzle. The biggest challenge is figuring out a retirement budget,” the article explains.

On the activity/lifestyle front, those surveyed suggested that pre-retirees “test-drive their retirement activities before retiring.”

The survey also suggested that retirees “consider working in retirement,” even if they don’t need the money, the article notes. “It can improve their quality of life… by helping them keep an active mind and maintaining a strong sense of purpose,” the article reports.

The research found that the most successful retirees seem to embrace flexibility in their golden years, the article adds.

“Ninety-two per cent of retirees said that preparation, flexibility, and willingness to adapt were keys to success in retirement,” Gunn tells Wealth Professional. “So, they’re making course corrections in all four pillars of health, family, purpose, and finance.”

Their focus, the article continues, is on “healthier diets, doing regular exercise, and finding mental stimulation. They’re spending more quality time with family and less in unhealthy relationships.”

This is all very insightful.

On the idea of “test-driving” retirement activities, we might add a suggestion — why not test-drive your retirement budget? Before you retire, spend a month or two living on what you think your retirement income is going to be. That way, when you leave the workforce, you won’t be surprised, but prepared.

Friends of ours did this when buying their first home. They were worried what it would be like paying a mortgage, and thus, having less to live on. So, for six months before they started their mortgage, they banked the difference and tried living on the lesser amount. The plan worked perfectly — they had a stress-free transition to home ownership.

More is always good when it comes to retirement income. If you don’t have a pension program at work, and are saving on your own for retirement, why not consider partnering with the Saskatchewan Pension Plan? This do-it-yourself pension plan will invest your retirement savings in a low-cost, pooled fund, grow them, and when the time comes, help you turn those saved dollars into retirement income! Check out SPP today!

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Here comes the bill. What’s a fair amount to tip?

The old rule of thumb used to be 15 per cent, but in many places, you are presented with the options of 20, 22 and even 25 per cent if you pay with a debit or credit card.

So, what’s the best path forward on tipping? Save with SPP took a look around to see what folks are saying on this topic.

According to Global News, tipping, like many other things, is being impacted by inflation.

“People feel like tipping is getting out of control,” Angus Reid’s David Korinski tells the broadcaster. Sixty-two per cent of Canadians surveyed by the pollster said “they’re being asked to tip more,” and “one in five reported leaving a tip of 20 per cent or more the last time they dined out,” the Global article reports.

Inflation, Korinski tells Global, is making the price of everything higher — which means you are tipping for meals and services that cost more than they used to.

“When you get the tipping machine, instead of 12, 15, and 18 per cent for the suggested tip, it now says 18, 24, and 30 per cent. I think for a lot of people, that it’s getting a little overwhelming,” Korinski tells Global.

Fifty-nine per cent of those surveyed said they’d like to see a “service included” model, where tips are not needed, but workers receive higher wages and benefits.

So how much should we tip?

According to the Wealth Awesome blog, “in days past, a 10 per cent to 15 per cent tip was considered average. Today, however, a 15 to 20 per cent tip is considered normal for most services.”

The blog recommends a tip of 25 per cent “or more” for “exceptional service,” 20 per cent for “great service,” a tip of “15 to 20 per cent for average service,” and a tip of “10 to 15 per cent for below average service.”

Over at the CBC, flaws are being noted in our nation’s “tipping culture.”

“Card payment machines have made it simple for businesses to prompt a gratuity option, even in industries where tipping previously wasn’t part of the cost or conversation. And data from Canadian trade associations show the average percentage tip for restaurant dining has gone up since the pandemic began,” the broadcaster notes.

The University of Guelph’s Professor Mike von Mossow tells CBC he is even asked to tip if he picks up a couple of cans of beer from a microbrewery.

He tells CBC this is a “double whammy” for consumers, “with more businesses asking for tips while simultaneously raising their prices.”

“You know, I’ve started to wonder if I give a particularly good lecture, should I put a jar at the front of the lecture hall at the end, and as they file out? Maybe they could drop a few bills in there for me, too. I mean, where does it stop,” he asks the CBC.

The Conversation raises questions about why we tip in the first place. Isn’t it for good service?

“This belief presumes that the server receives the tip,” the article explains. “But in most provinces, management often requires servers to share tips with kitchen staff, and sometimes with management itself,” the article continues.

Furthermore, the article explains, there could be tip-sharing (or tipout) at your favourite resto. “Your individual hard-working server may not have any appreciable benefit from your generous tip,” the article tells us.

And if we tip because we feel our server/service supplier is working hard for a low wage, what about everyone else who is working for minimum wage, the article asks.

Tipping, and how much you tip, is at the end of the day up to you.

Viewed through the lens of retirement saving, one might want to think about giving oneself a little tip now and then to boost our retirement savings. Even if you were to pay yourself first, to the order of five per cent per month, you’d see your retirement nest egg begin to grow.

The Saskatchewan Pension Plan allows you to “tip up” your retirement account in several ways. SPP can be set up as a bill in your online banking, so that you can direct dollars there that way. You can make contributions on our website via your credit card. Or, you can fill out this form and have a pre-authorized contribution deducted regularly from your bank.

It’s a good tip that your future you will greatly appreciate. Check out SPP today!

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In an about-face, kids now support parents who didn’t save for retirement

So much for stories about boomerang kids who won’t leave home — it now seems that kids are supporting parents who didn’t save enough for retirement!

Writing in The Globe and Mail, columnist Rob Carrick notes that “the overwhelming reason why adult kids are financially supporting their parents is insufficient retirement savings.”

In a poll conducted via the Carrick on Money newsletter, 52 per cent of those aged 18 and up who provide support for their parents cite a lack of retirement savings as the reason they have to help mom and dad. Ten per cent of those surveyed said their parents had outlived their retirement savings — and therefore needed help from their kids, the newspaper reports.

“A suggestion for anyone in their thirties and older: Have a conversation with your parents about their retirement savings. Ask if they have any. If so, how much and what kind. Though it’s not much talked about, adult kids are clearly playing a backstopping role in this country’s retirement system. Be prepared,” writes Carrick.

Some of the other reasons cited in Carrick’s column as to why adult kids are supporting their parents include illness or disability (nine per cent), debt loads experienced by the parents (4.8 per cent) and divorce (4.3 per cent). The article says other reasons include “cultural expectations, job loss and death of a spouse.”

Interestingly, the survey results indicated that “even people who owned homes and who have pensions require help,” the article reports. Seven in 10 of survey respondents said their parents “currently or previously owned a home,” and one in three said their parents “have a company pension.” But they still needed help, the article explains.

“Take note if you think your house is your retirement plan, or that having a pension means retirement security. Pension payments can be small if you work for an employer for a short period of time. As for houses, they are a financial responsibility as well as an asset. Coping with big repair and maintenance bills can be a handful when you’re retired,” Carrick warns.

Other findings from the survey include the fact that 38.5 per cent of those surveyed help their parents “through periodic cash infusions,” and 29 per cent “make regular cash payments to parents,” the article reports.

Eleven per cent report that mom and dad have had to move in with them, the article adds.

While a large percentage of respondents were helping parents who were in their 90s and above, age 60 seems to be when parents start needing help, Carrick concludes. That help, he notes, can be small — less than $1,000 a year — or large, and over $100,000 annually.

Saving for retirement is a great way to avoid being a burden to your kids. If you haven’t started yet, check out the Saskatchewan Pension Plan. Any Canadian with registered retirement savings plan room can join, and once you are a member, you can contribute any amount up to your RRSP contribution limit, or transfer in any amount from other RRSPs.

And if you are worried about running out of money in retirement, SPP offers retiring members the option of a lifetime annuity, which means you’ll get a cash deposit on the first of the month for the rest of your life.

Check out SPP today!

In Healthy No Matter What, authors Dr. Alex Jadad and his daughter Tamen Jadad-Garcia make the fascinating argument that our “natural gift of adaptation” is a form of superpower, one that can help us live a healthy life despite the many challenges we face.

They note that health self-assessment — in which you are asked if your health is excellent, very good, good, fair or poor — has led to some “groundbreaking” findings.

Those who are positive about their health tend to be healthy, the book explains. But those who negatively self-assess their health “have twice the risk of premature death than someone who rates their health as positive,” and tend to live at least 23 years less than those who say their health is excellent, the book notes, citing U.S. research.

The book takes a detailed look on why some of us live longer than others, and much of the focus is on our ability (or lack of ability) to handle stress.

A chapter on “Toxic Stress Load” or TSL explains that stress plays a key role “in how long and healthy your life could be.” TSL refers to “the physical and psychological reaction of a person to long-term threatening situations or events, especially those that start in early childhood… the wear and tear your experience from grinding through life.”

Wealthier people tend to have less stress and lead longer lives, the book notes.

“In 2021, the female citizens of Monaco had a life expectancy of 93.4 years. At the time, their home country had a Gross Domestic Product of more than $190,000 per capita (U.S. dollars), with the fourth lowest infant mortality rate, the 10^th most powerful passport in the world, and zero homicides per year from 2007 to 2018,” the book says.

Another long-lived group are those who live in “Blue Zones,” such as Okinawa, Japan; Sardinia, Italy, Icaria, Greece and other locations. “Apart from being isolated places, with communities that draw from a somewhat related genetic pool, the Blue Zones are all places that encourage physical activity in natural settings.” Those living there “put their family ahead of other priorities, have a clear life purpose, have low rates of smoking, drink alcohol in moderation,” and eat healthy diets and engage in stress-reducing activities, the authors note.

Research on those living to 100 and beyond found “a tendency to react with low anxiety to stressful situations” and eating smaller portions of food, the book notes.

In the chapter “You Are What You Think,” we learn that money is “the main source of psychological stress for people in the richest country in the history of the world,” the U.S.

Research from south of the border found that “financial concerns have trumped health, family and work as the main source… of stress for Americans since 2007.” Having “insufficient savings for retirement (51 per cent) and excessive debt (30 per cent) are listed as the top two money concerns, the book explains.

A startling stat from the book is that 52 per cent of Americans under 40 are “more afraid of retirement than death,” even though they have two decades ahead of them to save for retirement.

The book lays out ways to overcome stress and fear about life events. The “BASK” acronym refers to Behavioural tasks, Attitude Changes, Skill Development, and Knowledge Acquisition.

Exercise, the book explains, is an antidote to anxiety. Yoga is another.

Optimism is also cited as a natural way to defend against anxiety. “Optimists tend to engage more often than pessimists in healthy behaviours such as exercising and eating nutritious diets, and they are less likely to smoke or drink alcohol in excess. Optimism is also associated with proactive strategies that can improve adaptability, including problem-focused coping and seeking social support…as well as with better psychological and physical function later in life.”

A later chapter looks at the value of friendship, “the single most important factor influencing our health, well-being, and happiness.”

We need to watch out for negative behaviours, the book warns, since “negatives attract.” A U.S. study found that “72 per cent of adults report having at least one unhealthy behaviour or avoidable risk factor, including insufficient sleep, obesity, physical inactivity, smoking or excessive drinking” had double the risk for premature death than those without such behaviours. Compulsive buying and binge eating were said to be the top two negatives to watch out for.

The book concludes with a chapter on how to get the most out of doctor visits by being a “good patient” and making sure you get answers to all your questions.

There is a lot of ground covered in this interesting read, but the message that comes through is that there is a lot of non-medical things we can do to stay healthier, better connected, and more focused — and together, a better attitude and handling life’s stresses will help us live longer and better lives.

Are you stressed about retirement? If you haven’t started saving for your post-work life, the Saskatchewan Pension Plan may be just what you’ve been looking for. SPP takes on the hard part of retirement saving, which is investing your contributions in today’s tricky markets, and growing them for your future. When it’s time to collect those dollars, SPP offers a full range of options including the possibility of a lifetime annuity. Don’t stress about retirement — check out SPP today!

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Close to half of non-retired Canadians have just $5K in savings: HOOPP study

Canadians within sight of the retirement finish line may have to put off their golden years, thanks to a lack of savings.

That’s one of the findings from new research by the Healthcare of Ontario Pension Plan (HOOPP) and Abacus Data, reported on by Global News.

“With a prolonged period of rising inflation and interest rates, Canadians of all ages are finding it much harder to save for retirement, and specifically the older age group that really should be looking forward to retirement,” said HOOPP’s Ivana Zanardo states in the Global News article.

Inflation is still more than twice as high as the Bank of Canada’s target of two per cent, the article adds.

A sobering finding from the research, Global reports, is that “44 per cent of non-retired Canadians aged 55 to 64 have less than $5,000 in savings, with one in five from that group saying they have not set anything aside for retirement.”

“The picture is bleak for those older Canadians,” states Zanardo in the article.

The lack of personal savings and persistent inflation, the article notes, have some older Canadians rethinking the whole retirement thing.

“More than half of those surveyed aged 55 to 64 said if inflation keeps rising, they will have to push back their intended retirement date,” the article notes.

“What really stood out for us this year and what was concerning is the older age group, and the fact that they’re just not as prepared for retirement as one would hope they would be,” Zanardo tells Global News.

“At a period in their life when they should be getting excited about retirement, because of inflation and rising interest rates they’re now considering whether they can retire when they had planned on and whether they should be pushing that day out,” she tells the broadcaster.

Abacus Data CEO David Coletto, who has been aiding HOOPP’s research efforts for five years, notes that “70 per cent of respondents have consistently agreed that Canada is heading for a retirement crisis.”

Coletto spoke a while ago to Save with SPP about millennials and their attitudes to retirement saving — you can see that interview here.

Even though experts like Zanardo recommend saving for retirement “early… and often,” the research found that 44 per cent of respondents had not set aside any retirement savings in the previous year. The research found that 70 per cent of those surveyed “would take lower pay in exchange for a better pension.”

If you are fortunate enough to have any sort of retirement savings program at work, be sure you are contributing to the max. If you don’t have a workplace plan and haven’t really got going yet on retirement savings, the Saskatchewan Pension Plan may be just what you’re looking for. You decide how much you want to contribute each year — any amount up to the available registered retirement savings plan room you have. You can make your contributions automatic, like a workplace plan, by arranging for pre-authorized contributions direct from your bank account. Or, you can set up SPP as an online bill and pay yourself monthly, along with your heat, light and credit cards. You can even pay by credit card.

No matter how the contributions get to SPP, our team will professionally invest them in a pooled fund for a low cost. They’ll grow your savings, and when it’s finally time to escape from work, SPP will offer you a variety of retirement income options, including the chance at a lifetime monthly annuity payment. Check out SPP today!

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In a recent research paper published by the Canada Mortgage and Housing Corporation (CMHC), economist Aled ab Iorwerth found that Canada’s “very high levels of household debt — the highest in the G7 — makes the economy vulnerable to any global economic crisis.”

Save with SPP spoke to ab Iorwerth, who is CMHC’s Deputy Chief Economist, by telephone recently.

His paper notes that household debt in Canada “stood at about 80 per cent of the size of the economy” in 2008, rose to 95 per cent by 2010, and as of 2021 stands at 107 per cent of the nation’s gross domestic product.

That high level of debt, his paper notes, will “do most damage when a significantly negative external economic event happens — such as a global economic crisis – which leads to widespread job losses, as discussed above. It becomes difficult, if not impossible, for many mortgage holders to service their debt.”

Should we see any sort of economic turndown that leads to job losses, carrying high levels of debt into a time when unemployment is higher will “make any recession more severe,” his paper predicts.

We asked him if housing costs were one of the leading factors in the high levels of household debt here.

“I think so,” he replied, noting that mortgages represent “three quarters of that debt.” The rest, he explained, comes from credit cards and other forms of debt. This high level of indebtedness, he says, is nothing new — it is a “long-term trend” in Canada.

He added that high housing prices (which lead to large mortgages) are a particular problem “in big cities like Vancouver, Toronto, Montreal, and even Ottawa. It is a real issue in big cities.”

We asked if high levels of household debt restrict, or limit, the ability of people to save for long-term goals like retirement.

ab Iorwerth says that while he generally agrees with that statement, it gets complicated when you consider that housing is a type of debt (through a mortgage) but “also a form of savings,” since when the mortgage is discharged, you have an asset that is worth something.

“There are risks involved in saving through housing,” he adds, pointing to what happened in 2008-09 with the collapse of world’s credit markets. And he says households “tie up so much money in housing” that it does have a restrictive impact on other forms of saving.

We then asked for his thoughts on inflation’s impacts on lower-income Canadians.

There are a lot of impacts, he says, and again, some subtleties. For lower-income families, he explains, we are usually talking about rental payments rather than mortgage payments. But rental rates tend to go up in times of inflation. “If someone was living in a rent-controlled apartment, if they are looking to move, they will be facing a sharp jump in rental rates,” he says.

At the grocery store, inflation’s impacts “are felt more keenly.”

Overall, however, ab Iorwerth says “the situation is not good in the rental system — you are going to see a really big jump in rents.”

Asked if there is any sort of step governments could take to help with the country’s housing situation, ab Iorwerth says it has long been CMHC’s position that Canada needs “a dramatic increase in housing supply, right across the board.” More housing is needed not only for lower-income Canadians, but for the middle class as well, he explained.

“We need more apartments, more rental properties — more supply right across the board,” he adds.

Longer term, his research paper notes, “re-establishing housing affordability in Canada will be key to reducing household debt if (more Canadians) want to become homeowners.”

Asked what he found most surprising in his latest research, ab Iorwerth says it was really looking at “the international picture” and noting that Canada’s household debt was second only to Australia’s.

By contrast, his paper notes, the U.S. level of household debt was at 100 per cent of GDP in 2008 but has since dropped to 75 per cent as of 2021. Over the same time period, the paper notes, the U.K.’s level of debt versus GDP went from 96 per cent to 86 per cent.

We thank Aled ab Iorwerth for taking the time to speak with us.

Thinking about saving for retirement? If you don’t have a workplace retirement program of any kind, the Saskatchewan Pension Plan may be the plan for you. Any Canadian with registered retirement savings plan room can join. Check out SPP today, and find out how it has been helping Canadians save for retirement for more than 35 years.

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Making a case for government-run long term care insurance: NIA

It’s not something we are ever prepared for. But many Canadians find out the cost of long-term care can range into the thousands per month when something happens to a loved partner or parent. It’s a cost that few expect or plan for.

Those are some of the reasons why the National Institute on Ageing (NIA) is calling for a national long-term care insurance plan, reports The Toronto Star.

NIA’s Dr. Samir Sinha calls such a program “a necessary `social contract’ that will especially help GenXers, the eldest of whom are marching towards 60, and the massive cohort of millennials, who will start turning 50 in the early 2030s,” the newspaper reports.

“More people are living paycheque to paycheque and so they aren’t really doing a great job saving for their retirement,” Sinha, who is also director of geriatrics at Sinai Health and University Health Network, tells The Star.

“And the biggest thing that can really threaten anyone’s retirement or how they live in retirement will be if they all of a sudden have long-term-care needs,” he adds.

Long-term care is defined by the NIA “not as the traditional nursing home depiction, but as a mix of supports or health care services from public or private care providers across a range of settings, including institutions, the community and individual homes.”

“Many will one day need extra help, with bathing or getting dressed; or from physiotherapists or occupational therapists. It’s not just the potential vulnerability of old age, many will be living with disabilities. Some coverage is provided currently by a patchwork of provincial systems across Canada, the paper said, but often expenses are paid by the individual, if they can afford it,” the article notes.

Often, the article reports, people think they can look after an elder family member on their own. This is harder than it may sound, states York University’s Pat Armstrong in the article.

“The assumption that care will be provided by family, especially women, often leads to an unhappy awakening, given that many caregivers are not qualified to provide the support needed,” the article notes.

“It takes medical training that many don’t have, whether it’s looking after a partner with dementia or a chronic disease,” the article continues.

“It’s especially the case now when you have people with catheters and kidney failure and all kinds of other equipment they go home with,” Armstrong tells The Star. “That requires an incredible amount of training and skill. And the recognition that those skills mean you have to pay for them.”

The article notes that Germany, Japan, the Netherlands, Taiwan and the US state of Washington all provide state-run long-term care insurance programs for citizens.

Without any state insurance program, we face some rather dizzying costs, the article reports.

“In nursing homes… co-payment fees cost more than $33,000 a year for a private room and $28,000 for a semi-private room. In-home services, the paper said, can range from $1,000 to $3,500 dollars per month while the cost of complex home care in Ontario can cost as much as $25,000 a month.”

It will be interesting to see if any levels of government in Canada explore this idea, particularly given the fact that the NIA predicts that one quarter of Canadians will be over 65 by 2030 and by 2048, the eldest GenXers will be in their 80s.

Did you know that the Saskatchewan Pension Plan is portable? Since SPP is a program that is independent of any employer, if you change jobs, you can continue to grow your SPP pension. Check out SPP today!

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Story after story talks about how X per cent of Canadians don’t have enough savings to pay an unexpected $2,000 bill — or how they live paycheque to paycheque.

So, fine. Maybe we don’t save as much as we’d like. But are there any nations that can make that boast? And if so, why — what’s making them save so well? Save with SPP had a look around to find out.

According to the Statista website, the Swiss are the world’s leading savers, socking away an impressive 23.1 per cent of household income as of 2020. They are followed closely by the Irish (21.6 per cent), the French (21 per cent) and the citizens of tiny Luxembourg (18.1 per cent).

Canada was 12^th on this list.

Our grandfather was born in Basel, Switzerland and was a formidable saver.

Let’s focus, then on the top two, the Swiss and the French.

The Swiss, reports the BBC, are a bit unique in that they still like to use cash.

“In Switzerland, cash remains the dominant payment method. Here, there’s an assumption everyone carries cash, even in an increasingly digital economy. Most don’t get caught out buying a sandwich or paying for a haircut when the card payment machine is out of order,” the article notes. In fact, the broadcaster goes on, 70 per cent of Swiss financial transactions are in cash — 22 per cent are through debit cards, and just five per cent are via credit cards.

The relative lack of credit card use in Switzerland is quite instructive, particularly when contrasted with the record-high levels of credit card debt here in Canada. Less debt to pay down means more money to put in savings, perhaps?

A CNBC report found that in addition to having a cultural tradition of saving, the Swiss franc is a very valuable, stable currency. The average income in Switzerland is quite high, so people spend a smaller proportion of their overall earnings on “food and accommodation” versus folks in other countries, the article adds. Inflation, though high for Switzerland, was much lower than in other European countries, the article adds.

OK — the Swiss spend cash, even commonly using 1,000-franc banknotes, they are fairly wealthy, and so spend less of their overall income on necessities like food and shelter. That leaves more money for savings.

What about the French? In France, reports the Tilly Money blog, citizens enjoy “one of Europe’s most generous state welfare systems,” including “substantial unemployment benefits, a world-class healthcare system” and “one of the youngest retirement ages in Europe.” As we’ve read, there are still protests going on about changing the state retirement age to 64 from 62.

“The majority of the population put their savings into a financial investment ‘Livret A’ account, where the interest rate is low and fixed by the State but is also guaranteed by the State and tax free. Their second love is, of course, ‘investir dans la pierre’ – or what we would call investing in bricks and mortar,” the article continues.

According to the bank BNP Paribas, “middle-aged households (30 to 59 year olds) save more than younger and older generations.”

So for France, then, you not only have generous state benefits for retirement, unemployment and health, but a government-backed savings account and a focus on investing in real estate.

So, some interesting traits emerge her for our friends in Switzerland and France who are high savers. They like to use cash and not credit cards. They tend to have higher incomes and thus are less impacted by rising food and shelter prices. Government benefits are generous, and in France at least, you can save in a fund where your rate of return in guaranteed by the government. Both the French and Swiss seem to have a cultural tradition of saving.

It’s interesting to see how the other half lives — and saves!

Here in Canada, government retirement benefits are pretty basic. If you want a little more money to help fund your retirement lifestyle, personal savings is the way to go. A great tool to help you boost your retirement savings is the Saskatchewan Pension Plan. SPP will take your contributions and invest them in a pooled, professionally managed fund, run at a very low cost. When it’s time to start your retired life, SPP will present you with a variety of income options for your savings, including the possibility of a lifetime monthly annuity! Check out SPP today!

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Canadians are in middle of the pack when it comes to retirement age: Lovemoney

In a slideshow created for the Lovemoney blog, writer Charlotte Irwin finds that Canadians retire quite a bit later in life than folks in many other countries.

The average Canadian hits the silk at age 64.75, and departs from work.

But, reports Irwin, who did an analysis of all the OECD countries, many other folks around the world log out for the last time long before that age.

In South Africa, there’s no official retirement age, reports Irwin, but on average people are retired by age 60.

In France, where plans to age the official retirement age to 64 have been met with riots and protests, the average person retires at age 60.8. The official retirement age — for now — is 62, the article reports.

The Greeks, reports Irwin, are next, retiring on average at age 60.85. That number is trending upward as the official retirement age was raised to 67 in 2017, the article notes.

Belgians retire at 61.1, even though the official retirement age is 65.

“Most people actually retire several years before through early retirement schemes, and the average effective age for men is 61.6 years old, while women tend to leave work just at 60.5. The country’s historically generous state pension scheme was shaken up in 2011, when the early retirement age was increased to 62 and workers were forced to contribute for 40 years. The official pension age will rise to 66 from 2025 and 67 from 2030, measures which have proved highly unpopular, with strikes and protests across the country,” explains Irwin.

Poles begin their golden years at 61.35, and Spaniards at 61.7. In both countries, the official retirement age is gradually being shifted to age 67.

In the USA, the official retirement age is 62. Those born after 1960, the article reports, can start receiving government retirement benefits at age 67.

In Austria, women can get their government benefits at age 60, and men (currently) at 65, making the country have “an average effective retirement date of 62.15.” There are plans to raise the age for women to receive their benefits to 65.

Italians retire, on average, at age 62.4. There have been plans to raise the retirement age there to 67, but opposition has been strong and swift, and no changes have yet been agreed to.

Germans go, on average, at age 63.5.

In Denmark, it is 63.8. The Dutch leave just a little later, aged 63.85, as do the Finns.

Our UK cousins are on the job, on average, until 64.15 years of age. Then comes Canada, where plans to move the Old Age Security start date to 67 were started but then reversed.

So who retires at a later age than Canadians?

Australians (64.8), the Irish (64.85), Norwegians (65.1), Latvians (65.2), the Turks (65.6), the Swiss (65.7) and the Swedes (65.9) all retire later, on average, than we Canadians.

Next comes the Portuguese (66.95), Icelanders (66.95), Israelis (67.7), New Zealanders (68.1), Chileans (68.35) and Mexicans (68.9).

Finally, the longest-working citizens in the world are the Japanese (69.95) and South Koreans (72.3).

The article makes the point that all OECD governments are mindful of the fact that people are continuing to live longer and work longer — so government retirement benefits are changing in many of these countries, or have changed.

In Canada, government retirement benefits are very modest — so if you don’t have a retirement program through your work, you will be the one who shoulders the responsibility of saving for retirement. If you’re in that boat, the Saskatchewan Pension Plan may be just what the doctor ordered. Any Canadian with registered retirement savings plan room can join. You can contribute as much as you want each year (up to your available RRSP room) and can transfer any amount in from another RRSP. SPP invests that money for you, professionally and at a low cost, in a pooled fund. At retirement time — whenever that is — SPP gives you an array of retirement income options, including the possibility of a monthly lifetime annuity! Check out SPP today!

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When it all comes down to it, security means having a roof over your head and food in the fridge.

Let’s focus on food. For a shockingly high 5.8 million Canadians (as of 2021), food insecurity is a real problem. That many people, including 1.4 million kids, experienced “some form of food insecurity” two years ago, reports the CBC.

The article cites a recent study by the University of Toronto that found “15.9 per cent of households across all 10 provinces” experienced some level of food insecurity, which has got worse with the higher inflation rate of the last couple of years.

Provincial levels of food insecurity — meaning, a household has difficulty affording and obtaining food — range from a low of 13.1 per cent in Quebec to a high of 20.3 per cent in Alberta, the story notes.

The report concluded, the CBC adds, by calling on all governments “to address the vulnerability of households that are reliant on employment incomes but still unable to make ends meet, and ensure that working-aged adults not in the workforce also have sufficient incomes to meet basic needs.”

At the University of Regina, a research team is looking at ways that rural Saskatchewan can help address food insecurity, Global News reports.

The U of R’s Ebube Ogie tells Global News that concerns about food affordability are being raised thanks to inflation. But, she said, people can look to the Saskatchewan communities of Muskeg Lake and Val Marie for solutions, the report notes.

She tells Global News that “Muskeg Lake residents are becoming more self-sufficient through their local food forest, a self-sustaining, nature-inspired agricultural system that provides fruits, vegetables and other edibles, as well as medicines and cultural resources. Val Marie residents can access fresh foods from a nearby Hutterite Colony, a self-sustaining colony that produces its own food, and also rely on their personal gardens.”

There should be more effort placed on growing food locally, and purchasing it from local farmer’s markets, than on buying expensive processed goods, she notes.

“Saskatchewan is Canada’s bread basket and we want to see that manifested in how we live, how we produce food and how we consume food. Our goal is to end food insecurity and promote food security for everyone,” says Ogie.

In Barrie, Ontario, a company called Eat Impact is using another approach — rescuing fruit and vegetable that is close to, but not at, its expiry date and distributing it via food banks.

The company, reports the Barrie Advance, “works with local farmers to find out what’s available and at risk of going to waste.”

“Typically about 1.4 billion pounds (of food), every year in Canada, does not get eaten; it just gets thrown out. And it’s a huge problem,” Anna Stegink, founder of Eat Impact, tells the Advance.

Another possible way to reduce food insecurity would be to introduce some sort of Canadian version of food stamps, a program that has been running for many years in the U.S., reports the CBC.

Elyssa Schmier of MomsRising, a U.S. advocacy group, expresses surprise that Canada does not have a program equivalent to food stamps.

“It’s… one of the largest tools we have to combat poverty and hunger in the country,” she states in the article, speaking about food stamps.

“I know that families in Canada are struggling. It was very surprising to hear that [Canada doesn’t] have any sort of dedicated nutrition programs in place, especially to help families with children,” she adds.

The University of Victoria’s Matthew Little says programs like food stamps “shouldn’t be considered a long-term strategy” in the battle against food insecurity. Canada’s programs have tended to focus on poverty alleviation rather than directly on food supply, he explains.

Let’s hope that efforts continue to be made on making more food available to those who need it.

We can’t predict the future with any clarity, but it is a reasonably safe bet that everything — including food — will cost more in the future when we are retired than what it does today. That’s why it is always a good idea to save for retirement. The Saskatchewan Pension Plan has been helping Canadians build retirement security for more than 35 years. Check out SPP today, and find out how it can help you secure your future.

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