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When working becomes the new saving
The boomers are often blamed for having had an easy time of things versus the younger generations – lower costs for education and housing, better employment opportunities, and so on.
Despite this apparent rosy and opportunity-ridden life path, however, new research shows that boomers – even the youngest tier – haven’t been savers.
According to a study by Franklin Templeton Investments Canada, reported on via Benefits Canada, a stunning 21 per cent of “younger baby boomers” haven’t saved anything for retirement.
Young boomers, “defined as those between the age of 55 and 64,” have a simple solution to their lack of saving, the article notes. Forty-six per cent of them, the report states, “said they would consider postponing retirement.” In plainer terms, they are extending their careers.
How long will the extension be? “Fifteen per cent of Canadians said they expect to work until the end of their life and 22 per cent said they don’t ever plan to retire,” the article states. However, paradoxically, about half of the young boomer group (54 per cent) “retired earlier than expected,” the article explains.
It’s sort of hard to imagine people working on into their 70s and 80s. Even if there is work to be had, will people’s health be good enough for them to keep at it? At best it seems like an iffy option.
“With life expectancy increasing and retirement savings becoming ever more challenging, due to the high costs of living, we are seeing increased concern over having enough money for retirement across all generations,” states Franklin Templeton’s Matthew Williams in the Benefits Canada article. “Although it’s never too late to start saving, the best time to start contributing to retirement savings vehicles is when a person starts out in their career and may not have big financial commitments like a mortgage or childcare costs, and to find a way to maintain healthy savings habits as they age.”
Saving for retirement gives you options. You may be able to work less, and ultimately, not at all if your own savings augment your government retirement benefits. Your savings will also provide extra income, over and above that of any workplace pension you may be able to join.
If you haven’t started down the saving path, the Saskatchewan Pension Plan is worth a hard look. It’s open to any Canadian citizen, it’s been professionally run since the 1980s, has a strong record of good investment returns (at a low management expense) and has many options to turn your savings into an income stream when you retire.
Don’t let working be your savings plan – sign up for SPP today.
|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, classic rock, and darts. You can follow him on Twitter – his handle is @AveryKerr22|