Worst-ever bits of financial advice to watch out for

We occasionally, in this space, have listed some of the best bits of financial advice people have ever received.

That got us thinking – what are some of the worst bits of financial advice that have been doled out to people. In the interest of protecting us all from being steered the wrong way, Save with SPP is on the lookout for the worst of the worst, in terms of financial advice.

“Let the bank come get it,” is identified by the A Dime Saved blog is a top bad financial idea.

“When you finance something whether it’s a car or a home, you’re entering a legal agreement to pay for it. If money gets tight, you should be reaching out to your lender to negotiate, not ghosting them. Walking away and letting the bank `come get it’ might sound like a bold move, but it comes with long-term damage to your credit score that could haunt you for years,” the blog explains.

Another one on the blog’s list is “take a loan to pay off a loan.”

“Unless you’re consolidating debt at a lower interest rate, using one loan to cover another just digs a deeper hole. It delays the inevitable and compounds your financial stress. It’s not a solution — it’s a snowball,” the blog warns.

A third one is “put everything on a credit card for points.”

“Chasing credit card rewards without discipline is a trap. The points might look great, but the interest you’ll pay if you don’t clear your balance each month will wipe out every perk. If you’re not careful, your spending will spiral,” the blog explains.

The SoFi Learn blog suggests that “you don’t have to worry about retirement until later” is a particularly unsound bit of advice.

“Friends, family, and acquaintances may tell you to enjoy your youth and not to worry about your old age until later,” the blog explains. “However, the sooner you start to save, the more money you’ll have later on thanks to compounding interest, which builds earnings on your investment and on that investment’s interest. Putting off saving until midlife can put you behind the eightball, causing you stress and anxiety as you try to make up for lost time,” the blog adds.

A second idea in the blog is that “follow your passions” may not be the best financial advice you’ll get. “Although it sounds nice, following your passions professionally rarely pays the bills. And it can also put you into a very competitive and crowded field, if your passion is one of the common ones; say, acting, singing, cooking, or creating art,” the blog warns.

In a Global News article, a number of bad ideas are captured. Common bad financial mistakes, the article notes, include “using a credit card advance to fund a down payment, using student loan money to travel, moving too often and any investment seminar promoting a ‘sure-fire way to beat the market.’”

We can add a few more from our own travels. Thinking it’s OK to only make the minimum payment on a credit card. Taking a vacation “on the card,” without saving anything for it in advance or to pay down the debt afterwards. Unwittingly paying super high fees, front-end and back-end loads on investments. Not really knowing how much you are spending versus how much you are taking in.

Avoid these potential pitfalls, live within your means, and save for the long term. If you have a pension plan through work, be sure you are signed up and contributing to the max – don’t decide you’d rather spend that money versus setting it aside for your post-work future.

If you don’t have a workplace plan, the Saskatchewan Pension Plan may be just what you are looking for in terms of a savings partner. SPP is open to any Canadian with registered retirement savings plan room.

You decide how much you want to contribute – and you can also transfer in any amount from your other non-locked-in RRSPs. You provide the money, and SPP’s investment wing does the rest, growing your money in our low-cost, professionally managed pooled fund.

At retirement, those savings will turn into income to live on. Options include a monthly, lifetime annuity payment, or the more flexible Variable Benefit.

Check out SPP today!

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Top retirement countries for Canadians

The True North is, as we all know, Strong and Free, but can be cold in the winter, and expensive to live in.

So the folks at Money Canada have put together a list of the top countries Canadians might want to move to in retirement.

“When determining the top 12 best places to retire in the world, we considered factors like the cost of living, political stability and infrastructure, healthcare quality, safety, things to do and see and proximity to Canada,” the article begins. “We also looked at the ease and requirements involved in getting a retirement visa/long-stay visa. When doing our research, we consulted a variety of governmental sites, as well as local and international websites.”

At the top of the list is Panama.

“Panama is a wonderful place to retire, thanks to its unique combination of modern amenities, affordable cost of living, fascinating culture and tropical beauty. The country is especially attractive to those who prize an active lifestyle thanks to an abundance of outdoor activities ranging from hiking and birdwatching, to surfing and snorkeling along the coast,” reports Money Canada.

Portugal, the article continues, “boasts plenty of sunshine, affordable living costs and incredible cultural assets. The Algarve region, in particular, is popular with retirees for its beautiful beaches, charming towns and laid-back lifestyle.”

In Thailand, “few can resist the destination’s beguiling mix of modern amenities and ancient attractions and traditions.” France, the article enthuses, “has it all: a highly regarded food scene, ancient, atmospheric villages brimming with history, one of the most storied capital cities in the world and a never-ending selection of highly acclaimed museums and galleries to whittle away the hours.”

Mexico offers “proximity to Canada…  (a) temperate climate and (a) lower cost of living. Mexico is a top pick for Canadian citizens of retirement age,” Money Canada reports. Beautiful Malaysia is a country where “the cost of living is very low, healthcare is top notch and housing is affordable.”

Italy “offers an enviable mix of culture, awe-inspiring landscapes and affordability,” and Costa Rica “is well-known for its unparalleled natural beauty that showcases white-sand beaches, verdant rainforests, jaw-dropping volcanoes and acclaimed national parks.”

Rounding out the list are Spain, “with its delightful Mediterranean climate,” Greece, “one of the best places to retire in the world on a budget,” Switzerland, which boasts “one of the highest standards of living in the world,” and Ecuador, which “boasts some of the most singular and breathtaking landscapes in the world, including Galapagos, a world UNESCO site.”

It’s always nice, especially when you are shovelling the walkway in mid-January, to think of tropical weather in faraway lands. But whether you travel in retirement or stay put here at home, you’ll need some savings to live on.

The Saskatchewan Pension Plan is an open, voluntary defined contribution plan that any Canadian with registered retirement savings plan room can join. A feature of SPP is that you can consolidate any other RRSPs you have within SPP. Rather than having bits and pieces of retirement income from multiple sources when you retire, your income will all come from one place.

SPP’s retirement income options include a monthly annuity payment for life or the more flexible Variable Benefit.

Check out SPP today!

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Retirement planning in a novel format: Retire Younger Canada

Russell Roy’s Retire Younger Canada not only offers solid information on how to take control of your finances (and your life), but is a well-told, gritty novelized life story of fictional engineer Sam Jackson. We follow Sam’s life from his very early retirement at 48 until his death, in his 70s.

The author begins by telling us that he is “just a regular working Joe Schmoe who hated his job enough to be motivated to investigate and understand what I needed to do to retire early.”

As Sam prepares to clear out his desk at work, he gives a younger co-worker some important lessons “I learned as a kid,” specifically, “delayed gratification,” or learning to “save and plan,” the “impact of children on personal finances,” the importance of getting a higher education and “you get out what you put in, so work hard.”

Later, in a post-retirement party discussion, his wife Cindy remarks that many people don’t really enjoy their jobs, adding “I think that the people who truly enjoyed their jobs were the ones who chose to work for themselves.” This discussion led to thinking around the value of trying to retire as early as possible so that you can enjoy life after work in good health.

In retirement, Sam tells us, you get “freedom on so many levels. Freedom from work anxiety. You know I already feel freer to speak my mind… it feels like a weight has been lifted from my shoulders.”

Thinking about how he was able to retire at 48, Sam recalls that “as a young, bona fide working citizen, Sam saved a down payment and bought a house. This was the first, and most important and key financial decision he made.”

In a section about living off savings (decumulation) Sam talks about the ideas of spending four per cent (or 3.5 per cent) of your nest egg each year, with the goal of not outliving your money. He discusses the “bucket” plan where your nest egg is divided into “a cash bucket for the short term… a bonds bucket for the intermediate term and maybe stocks bucket for the long term.”

He goes into detail on how to track your income and expenses via a spreadsheet, and factoring in any upcoming big expenses. A second spreadsheet should track the progress of your investments, and a third, the “big picture” or grand total of all savings and investments.

He talks about the dangers of high investment fees. “You know, here in Canada, mutual funds will take an average of 2.2 per cent of your cash each year just to manage your money,” he explains to a young friend. Even if the indexes double, the annual fees eat up much of your growth, he explains. Instead, Sam reveals, he and his wife switched out of mutual funds into a portfolio of stocks – the Canadian ones eligible for the dividend tax credit – and fixed income, which he describes as “loan(ing) the money you save to others…. (so that) the money (interest) will slowly flow to you. The work of others will go into your pocket.”

He later goes on to explain that you need to be aware of the tax consequences of every type of income you will be receiving in retirement, so that you can plan to opt for a route that offers the least taxation possible.

In looking at his parents’ and in-laws’ finances, Sam noticed the risk of risk aversion had put them in the highest income tax bracket, since nearly all of their income came in the form of interest. Being anxious about investment risk, Sam observes, is a common trait. “It seems fear, more than anything, cripples people as they get older. They are afraid of more and more so they do less and less.”

“That is just another reason to retire early and live life now,” Cindy responds.

“Every day is Sunday in retirement,” the book notes, but without the dread of returning to work Monday.

The book concludes with this bit of advice.

“One parting thought. Few of us can afford the savings it would take to live forever. Retirement isn’t necessarily the end of anything. What it really is, is the freedom to make the best of the last years of your life on your own terms. Get after your bucket list, live your life to the fullest, and have fun.”

This is a very unique, creative, story-telling approach to the topic. It’s a highly recommended addition to anyone’s retirement library.

The Saskatchewan Pension Plan is a voluntary, defined contribution plan that is open to any Canadian with registered retirement savings plan room. If you don’t have a workplace retirement plan, SPP may be just the ticket for you. You decide how much you want to save, and SPP does the rest, investing your hard-saved loonies in a low-cost, professionally managed pooled fund. At retirement, your income options include a lifetime monthly annuity payment or the more flexible Variable Benefit.

Check out SPP today!

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Consider these steps to help you afford retirement – even if you are starting late

Gen Xers, reports GoBankingRates, are a “scrappy” bunch who are raising kids and caring for parents against a backdrop of “inflation and other rising expenses.”

A Lending Tree survey, the publication adds, suggests that 70 per cent of Gen Xers will “need all the help they can get to be able to retire.”

But the article lists eight things this group can do to help them to arrive safely in the Land After Work.

First, the article says, you need to understand “your own cost of living, health and goals” when figuring out how much you’ll need – not some generic “retirement blueprint,” states Tyler Meyer, CFP, and founder of RetireToAbundance.com.

Second, he adds. “don’t think of retirement as an all-or-nothing finish line.”

“For many people, retirement may look like a blend of part-time work or flexible work with investment income instead of a complete stop,” the article notes. “That shift in thinking instantly lowers the savings target and opens up more possibilities,” Meyer tells GoBankingRates.

The article is aimed at an American audience, but the third step applies to Canadians as well – be sure to contribute as much as you can to any workplace pension, or registered retirement savings plan, or Tax-Free Savings Account. If you have unused room, begin to fill it up, the article suggests.

If debt is a barrier to your saving, pay it off, the article tells us. Pay off the debt with the highest interest rate first, the article advises.

Think about side hustles that will bring in money when you are retired, rather than simply the idea of having to live on less, Meyer tells GoBankingRates.

“I have seen clients successfully turn interests such as woodworking, photography, fishing and gardening into steady income streams,” he states in the article.

Don’t judge yourself “for not being prepared for retirement,” states Ashley Stearns of Michigan’s Community Financial Credit Union. “Realize you are not alone,” she tells the publication, noting that on average, Gen Xers in the U.S. carry $9,557 USD in credit card debt, surpassing even boomers.

“The most important thing is to start. With the right support and a clear plan, Gen X can rewrite the narrative on debt,” she states in the article.

Another idea, the article continues, is to get the help of a money coach or financial adviser to help you develop “a workable retirement plan.”

The article concludes with a three-step approach to freeing up money for retirement savings, developed by Stearns:

• “Begin by tracking your expenses for a month to identify potential areas to cut and shift to retirement.”
• “Analyze your spending habits.”
• “Make small changes one at a time.”

Many members of the Saskatchewan Pension Plan take advantage of SPP’s automatic contribution feature. SPP permits you to make pre-authorized contributions from your bank account or credit card. By going this route, you are saving money before you have the chance to spend it. SPP will take those contributions and grow them in our low-cost, professionally managed pooled investment fund.

When it’s time to turn savings into income, your options include receiving a monthly annuity payment for life, or the more flexible Variable Benefit option.

Check out SPP today!

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Tips to get clutter packed up and on its way

Most of us have a room, or corner, where our clutter collection is tucked away. It’s often still boxed up from two moves ago. Or it’s a once-prized possession that no longer does anything but take up space.

It’s daunting to think of de-cluttering, particularly if the problem has grown out of hand. Save with SPP decided to see what the experts say about getting that junk gone in an easy, manageable way.

The Custodia Home Management site offers some ideas on de-cluttering strategy.

“Have you ever walked into a cluttered room and felt overwhelmed? Now, imagine how a senior feels when their home is filled with piles of unused items, making it harder to move around safely,” the article begins.

The goal of decluttering, the piece continues, is to create “a comfortable, stress-free place where seniors can move freely and feel at ease.” But how to get cracking on it? Let’s read on.

To “ensure a smooth and stress-free process,” the article suggests a strategic approach to clutter-outplacing.

“Start small – declutter one room at a time,” the article advises. “Begin with a small space, such as a closet or drawer, to build momentum.”

Next, the article suggests a “keep, donate, discard” approach.

“Simplify decision-making by sorting items into three categories: keep, donate, and discard. This method streamlines the process and reduces indecision,” the article explains. Many organizations welcome “gently used items, offering a meaningful second life to possessions.”

Your “keep” list, the article notes, should “prioritize essential and sentimental items.” Consider digital options for things like photo albums, the authors add.

Make it a fun and family focused activity, the article suggests, by hosting a “decluttering party” where guests are encouraged to take home things they want or need. Finally, you can consider hiring a professional company to assist you in the operation, the article concludes.

The Sort and Simple Canada blog provides a few more ideas.

Visualization, the article suggests, is a great first step. “Picture how you want your space to look, feel, and function, and be as specific as possible. With a clear vision, you’ll be able to decide with confidence what belongs in your space—and in your life,” the article tells us.

Another good idea – “stop clutter before it starts – decrease the incoming stuff,” the article explains. “Let’s be more intentional about what you bring into your home: think twice before making purchases, unsubscribe from mailing lists, and avoid freebies or hand-me-downs you don’t really need,” the article continues.

Some questions to ask yourself while decluttering include “`does this item support my organizing vision?’ or `Would I buy this again today?’ These questions help you shift from a mindset of scarcity (`I might need this someday’) to one of abundance (`I’m choosing what to keep in my life’).”

Another nice thought in the article – “pull everything out of the area you’re working on, and only return items that fit your vision and are genuinely useful or loved.”

A final thought – if you have a donation pile or box, “make sure those items don’t linger…. This will help avoid second-guessing your decisions,” while keeping things “clutter free,” the article concludes.

The publication House Digest adds a few final ideas to get your decluttering going.

Many of us fail to get going on sorting things out because “we feel intimidated and overwhelmed just thinking about trying to declutter everything. We picture spending hours — or even days — on end going through pile after pile and drawer after drawer just to make a small dent,” the article begins. So, start by setting a specific time period you will spend decluttering – start with five minutes a day and ramp it up as you go, the article advises.

Employ, the article continues, the Marie Kondo method. “Kondo recommends evaluating each item in your home and only holding on to those that `spark joy.’ That means that if you have something, but don’t use or enjoy it, you should let it go,” the article advises.

Another way to make the process fun is to turn it into a challenge, the article notes.

“Try the 30-day minimalism game. With this `game,’ you and your friend would each have to get rid of (trash, sell, or donate) a number of items to match the day of the month. So, on the fifth day of the month, you’d clear out five items, and on the 28th, you’d get rid of 28 things. When all is said and done, that means you will have gotten rid of an impressive 465 different items,” the article continues.

We’ll add one more – finding a loving home for your old stuff. A nearly new cat carrier used gently by our late kitty was greatly appreciated by the local cat rescue shelter. A perfectly good golf club we couldn’t hit is now in a friend’s golf bag, another friend is happily playing a 12-string guitar we got bored of playing after getting a new electric guitar.

If you are able to get a few dollars for any of your unwanted items, you can add to the thrill of your decluttered living space by contributing to your future self’s retirement income. Consider joining the Saskatchewan Pension Plan, open to any Canadian with registered retirement savings plan room. SPP will invest the dollars you save in our professionally managed, pooled, low-cost investment fund, and when it’s time to leave the clutter of the workplace behind, you can turn savings into income via such options as our monthly annuity payments or the more flexible Variable Benefit.

Check out SPP today!

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In the U.K., Gen Z confident about retirement, despite not saving or having pensions

Despite “the high cost of living, stagnating wage growth and lower job security,” a surprising 38 per cent of British Gen Zers say they are “confident in their financial future,” reports This is Money.

The data, compiled by U.K. pension firm M&G, found that only 17 per cent of those aged 45 to 54 shared that confidence, the publication adds.

“Although almost half of Gen Z don’t currently have a workplace pension, a fifth still expect to be able to retire when they are in their 50s,” the article reports, adding “this is despite the fact their pension age is likely to be at least 68.”

This suggests, the publication continues, a disconnect among younger folks about how much money they’ll need when they are retired, and when to start saving.

“It suggests young people’s optimism might be down to a lack of information about how much they need to save for retirement — and how much of a difference it can make if they begin saving earlier in life,” This is Money adds.

Alarmingly, only 30 per cent of Gen Zers asked fear running out of money in retirement, compared to 44 per cent of those “in their late 20s and early 30s” and 52 per cent of those aged 35 to 54, the publication continues.

 “It’s refreshing to see such positive attitudes from Gen Z towards their financial futures, but optimism alone isn’t enough to guarantee a comfortable retirement,” M&G’s Anusha Mittal tells This is Money.

There should be more focus on long-term retirement savings, even for the young, the article adds.

“As few as eight per cent of 18 to 24-year-olds say that building a pension pot is one of their financial priorities. Some 49 per cent said a priority was to spend money on things they enjoy,” the article explains.

Indeed, retirement saving may not be much of a priority for younger Britons, the article notes.

“Most of my savings go towards life experiences, especially travel, which I see as a valuable way to spend money while I am still young,” assistant psychologist Cynthia Wong, 27, tells This is Money. “I believe that wealth is defined by meaningful experiences, and I prioritize them over saving for things that feel distant like retirement,” she states in the article.

Wong goes on to say that saving for retirement may become more of a priority for her later on.

M&G’s Mittal contends that now is the time to start retirement saving.

“Unless Gen Z’s enthusiasm is matched by action — including better understanding of where their money is going, how much they’re saving, and whether it’s enough — they could be sleepwalking into a ‘too little, too late’ scenario when it comes to retirement readiness,” she states.

Workplace pensions are a great thing, but are becoming scarcer, forcing many to save on their own for their retirement. If you’re in this category, the Saskatchewan Pension Plan may be the savings partner you’ve been looking for. Open to any Canadian with registered retirement savings plan room, SPP does the heavy lifting for you, investing your savings in a professionally managed, low-cost pooled fund. At retirement, your income options include getting a monthly annuity payment for life, or the more flexible Variable Benefit.

Check out SPP today!

Join the Wealthcare Revolution – follow SPP on Facebook!

Is the “buy Canadian” movement having a positive impact?

The whole issue of the trade war with the U.S. has prompted many of us to focus on buying made in Canada goods and services wherever possible.

Save with SPP checked to see how this idea is going, and what benefits it may be bringing.

Writing in Retail Insider, Mario Toneguzzi cites a recent report from NielsenIQ that stated “retailers and brands, take note—this is more than a moment. It’s a mindset. And it’s reshaping what loyalty, value, and national identity look like in the Canadian aisle.”

The article points out that “nearly half of Canadians are taking a stand” on buying Canadian or avoiding American brands. “From boycotting U.S.-made goods to choosing Canadian products even when they’re not the easiest or cheapest option, shoppers are putting their wallets where their values are,” the article adds, again citing NielsenIQ information.

There are economic benefits to the movement, reports Money Canada.

“A report by BMO economist Robert Kavcic suggests that the `Buy Canadian’ trend could add as much as $10 billion annually to Canada’s economy. This shift in consumer behavior is not just patriotic — it’s becoming a meaningful source of stimulus for the Canadian economy. Kavcic estimates that a modest shift in spending toward Canadian goods could generate $6 billion in value. With more than half of Canadians saying they intend to buy Canadian-made products in response to the trade conflict with the U.S., the movement has become a potent economic force,” the article notes.

In the grocery aisle, the article continues, “the `Buy Canadian’ movement represents both a business opportunity and a chance to support local farmers and producers.” As well, the article adds, “with more Canadians choosing to buy local, it seems that the movement is not only reshaping how Canadians shop but also how they think about their role in the economy.”

The Toronto Star reports that Canadian chocolatier Purdys has made its products available in a Canadian grocery store for the first time in its 118-year history, all thanks to increased buy Canadian demand.

“Since about January, we really noticed … people either remembered that we are a Canadian brand and always have been or were interested in learning more about Canadian brands and how they could support Canadian companies through that uncertain time,” said Kriston Dean, vice-president of marketing and sales at Purdys, tells the Star.

“Their interest manifested in a more than 200 per cent increase in traffic to Purdys website and a whopping 300 per cent spike in searches about whether the brand is Canadian,” the article adds.

The CBC reports on a small farm business in Quebec has seen “a spike in sales” thanks to the movement.

The Agricola Co-operative Farm in Petite Nation, Que. “grows vegetables, herbs and cut flowers.” Sales were up more than 20 per cent over last year, the broadcaster reports.

“It’s a way of getting your groceries, but I think it’s also that idea of [how] community supported agriculture is also a way of participating a bit more directly in the local food system,” the farm’s Natalie Childs tells the CBC.

Did you know that the Saskatchewan Pension Plan is a voluntary retirement savings program that is open exclusively to Canadians with registered retirement savings plan room?

With SPP, you decide how much you want to save, and we do the rest, investing your hard-saved loonies in a professionally managed, low-cost pooled fund. At retirement, your income options include receiving a monthly annuity payment for life, or the more flexible Variable Benefit Option.

Check out SPP today!

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There’s no question we are living in uncertain times – how will the trade war and its tariffs impact investing and Canada’s job markets?

We may not yet know exactly where things will land, but – according to a Money Canada piece by Nicholas Sokic – Canadians “are staying diligent in saving for retirement.”

In fact, he writes, citing a report from Sun Life, retirement savings contributions are, on average, at $9,500, “a six per cent increase from 2022.”

“The ‘buy Canadian’ sentiment that gained popularity earlier this year may also be having an impact on how people are investing their money. While some are adjusting their finances, it’s encouraging to see that they aren’t reactively pulling their money out of the market,” Sun Life’s Dave Jones, senior vice-president, group retirement services, states in the article.

“In the first quarter of 2025, members moved their money out of U.S. equity funds at the highest rate witnessed since the beginning of the COVID-19 pandemic. While more people are reducing their risk exposure, they are not withdrawing their money from their plans. Withdrawal rates remain stable when compared to past years,” the article continues.

Other findings outlined in the article:

• 70 per cent of plan members “who engaged with an advisor” were seen as being more likely to take action with their finances than those without such help.
• 42 per cent of plan member balances are in “target date funds,” a type of investment that becomes more conservative (and less exposed to equities) as the member ages.
• Workplace pension plan members are, on average, retiring “two years earlier than the average Canadian.”
• Average workplace pension plan balances in the Sun Life survey were at $94,220.

The idea that Canadians are saving more these days is also captured in an article on the Statistics Canada website.

“Recent analysis from Statistics Canada on the `third pillar’ of the retirement income system — in addition to government pension plans — hows that there has been an increasing share of families’ contributions to one or more of the three registered savings accounts: Registered Pension Plan (RPP), Registered Retirement Savings Plan (RRSP), and the tax-free savings account (TFSA),” the article begins.

In 2009, just over half of Canadian families contributed to one or more of these savings vehicles – a rate of 52.3 per cent,” the article continues. By 2022, that percentage had jumped to “nearly three in five families (58.1 per cent),” the article adds.

TFSAs increased in popularity in the 2009 to 2002 period, while contributions to RPPs and RRSPs “stayed flat, or declined over the same period,” the article notes.

These articles show, it would seem, that Canadians see that saving for retirement is important, even if the times are challenging.

If you have a retirement savings program through your workplace, be sure you are signed up and contributing – often there can be an employer match.

If you don’t have a workplace plan and aren’t sure how to go about investing for retirement on your own, the Saskatchewan Pension Plan may be just the ticket. With SPP, you decide how much you want to save, and SPP’s team does the rest. Your savings dollars will be invested in a low-cost, professionally managed pooled fund.

When it’s time to depart from the workforce, your options for turning your savings into income include getting a lifetime monthly annuity payment from SPP, or the more flexible Variable Benefit.

Check out SPP today!

Join the Wealthcare Revolution – follow SPP on Facebook!

Jim Green’s Retirement Reimagined makes the important point that while traditional retirement at 65 may not work (or be available) for everyone, there are other options, such as “intermittent retirement” or the FIRE approach, to consider.

In discussing the traditional “retire at 65” approach, Green writes that “more and more Canadians are discovering that having all the time in the world doesn’t necessarily make you happy. In fact, too much free time – without purpose, challenge or community – can leave you feeling lonely, bored and even depressed.”

But there are alternatives to traditional retirement, such as “the FIRE movement – Financial Independence, Retire Early” or the Travis McGee plan, “retiring in chunks. Picture this: work hard for a few years, save up, then take a full break.”

In the section on traditional retirement, Green notes that 65 “became the standard” for government retirement programs and company pensions because, years ago, “life expectancy wasn’t much higher…. In post-World War II Canada, a male teacher retiring at 65 had a life expectancy of just 66. One quiet year of rest – and that was it.”

While some people – notably those in public service jobs with defined benefit pensions – do fine with the traditional “retire at 65” plans, many others don’t. Green notes that the average registered retirement savings plan (RRSP) balance by age 65 is just $129,000. The Canada Pension Plan pays “roughly $9,600 a year” on average, he continues, with Old Age Security adding, on average, another $8,400 annually. Only 37 per cent of Canadians have a workplace pension, he notes. These modest amounts then must stand up to the “unwanted houseguest” of inflation.

The old model isn’t broken, but it has cracks, Green writes. If you are on the path to a traditional retirement, you need to ask yourself “what will I do with my time? How will I stay engaged, healthy and connected? Can I afford the lifestyle I picture – or is it based on assumptions from my parents’ generation?”

Planning helps. You need to know, in advance, your retirement income from all Canadian sources, Green writes. Max out retirement savings vehicles where you can and create a “purpose plan” to make the most of your free time.

Another approach is the FIRE plan, Green writes.

For this to work, you need to “earn a lot (or at least more than average.” You then “live on very little… FIRE fans are masters of minimalist living.” You need to “save aggressively – like 50 per cent of your income…. Your bank account grows while your social life… doesn’t,” he warns. This money must then be invested wisely. “No crypto. No lottery tickets. Just good old index funds, ETFs, and compound interest doing its thing over time.”

FIRE can work. The book cites the example of Priya in Mississauga, who was able to “retire” at 39, mortgage-free. “Freedom. No bosses, no commutes,” writes Green, adding that many FIRE devotees will still do part-time work they like to cover expenses, but are retired from full-time work they didn’t like.

On the negative side, FIRE “can also turn into a pressure cooker of frugality and spreadsheet obsession.” You will, writes Green, be saying no to things now “so you can say `yes’ later,” and driving a more modest car, but “the magic lives” in the moment where your investments cover your expenses. “That’s when you can start living differently, and you can do it decades before 65,” he adds.

The final idea presented in the book is the “retirement in chunks” or Travis McGee approach.

“Take on a risky but well-paying job. Earn enough for a comfortable break. Sail off, read, relax, restore. Repeat when funds (or purpose) ran low.”

“It’s a little like sabbaticals, seasonal work, or freelance life – but with better tans and more tequila,” Green adds.

Green describes “retirement in chunks” as a “middle way” between traditional retirement at 65 and FIRE.

“You work, when it suits your finances and your passions. You pause, to reset, travel, raise kids, study or just breathe. You return, not out of desperation, but because you’ve still got gas in the tank – and curiosity that needs satisfying.”

Interesting side benefits of this strategy include doing your travelling while you are young, rather than waiting until you are older and less healthy, Green writes. “When you live intermittently retired, you stay in the world. You meet people. You try new things and keep adding colour to your life canvas.”

This is a great book, particularly if you are younger and still planning your future life. The idea that there is more than one way to approach life after work is a strong one, and Green lays out the strategies clearly, with lots of references to Canadian resources, handy checklists, and a very good sense of humour. An excellent read!

No matter how you approach the inevitable end of full-time work, money will be very handy to the future you. As the book mentions, a mere 37 per cent of us have access to workplace pension plans. If you are among the 63 per cent who don’t have a workplace plan, the Saskatchewan Pension Plan may be just what you have been looking for.

You save the money in your SPP account, and we invest it, professionally, in a low-cost pooled fund. At retirement, you can choose from such options as a lifetime annuity payment or our flexible Variable Benefit.

Check out SPP today!

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Can visualization help you save for retirement?

The golf pro visualizes the flight of his ball, imagines it landing on the green near the cup. Then, the pro steps up and executes the visualized shot.

Certainly visualization is a proven approach. But could it also work for retirement savings? A recent article in Forbes magazine by Wes Moss suggests that it could.

The Harvard Business school, the article begins, recently wrapped up “a decade-long longitudinal study on retirement behavior—tracking 14 individuals closely over ten years and surveying 106 more—revealing comparative insights into different retirement transition approaches.”

The study, Forbes reports, had a notable key takeaway – that “retirees often struggle when their vision of (retirement) happiness is unclear or lacks purpose.”

“Charting a course for retirement is difficult without a clear destination. The study illustrates this by contrasting two knowledge workers’ post-career lives—one who proactively envisioned a fulfilling retirement found happiness quickly, while the other became isolated and unhappy. Think of two people embarking on separate open-road adventures; the one with a map will likely enjoy a more efficient trajectory.”

We are reminded of the old George Harrison lyric – “if you don’t know where you’re going, any road will take you there.” So OK, having a positive vision of retirement is beneficial to your overall happiness. Where does saving come into it? Let’s read on.

Research carried out by Indiana University asked “whether feeling a stronger connection to one’s future self would encourage more retirement saving. After 20 experiments, the answer was a clear yes,” Forbes reports.

The Indiana University research, led by Professor Katherine Christensen, asked participants “where they wanted to end up instead of where they were or how they would get there,” Forbes reports. This question got respondents thinking more positively about helping, via savings, their future selves, the article explains.

“In one experiment analyzing over 6,700 customers of a Swedish fintech company, individuals with low-balance savings accounts were 14 per cent more likely to invest in a long-term savings product when prompted to think about their future selves first,” the article adds.

“Retirement isn’t just about growing a bank account. It’s about buying the opportunity for peace of mind. The sooner a current or future retiree envisions their ideal life, the easier it becomes to take the first step toward building it. When practiced with consistency and intention, this exercise may help convert today’s modest savings into tomorrow’s purpose-filled retirement,” the article concludes.

If you haven’t started saving for retirement, it’s never too late – and your future self will thank you, gratefully, for any work you put in today.

The Saskatchewan Pension Plan is a great choice for those of us saving on our own for retirement. SPP will do the heavy lifting, professionally investing your hard-saved dollars in a low-cost, pooled fund. The fund is heavily diversified, and includes Canadian and international bonds and equities, mortgages, real estate, and other categories. You won’t be putting your precious savings eggs in one basket.

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