Canadians over 50 fear outliving their savings

not so happy woman

These days, traditional defined benefit pension plans that paid an adequate lifetime pension benefit are being replaced with lesser vehicles that don’t – defined contribution plans that may provide less than 16 per cent replacement income, personal savings (the average Canadian has just $60,000 in RRSPs at retirement) or no plan at all.

This article was published by Ariapensions.ca on September 17th, 2013.  To see this article and other related articles on their website, please Ariapensions.ca

Government retirement benefits are modest. Thus, it is not surprising that an article by Postmedia’s Misty Harris, citing figures from CARP, notes that “outliving their money is the biggest fear of Canadians over 50 today.”

Harris also cites a finding from the recently released Statistics Canada National Household Survey – “retirement doesn’t mean what it used to,” she writes. “At age 60, fully 68.8 per cent of Canadians in 2010 were still earning employment income; by age 66, 43.1 per cent were doing so; and at 75, nearly one in five seniors – 18.2 per cent – continued to collect a paycheque,” she reports.

In other words, the report notes, more and more Canadians are unable to afford retirement.

Her article goes on to reference recent research by the Canadian Payroll Association that found that a lack of savings is behind the reason that some older workers are delaying their retirement plans.

“Among those with a target retirement date, 35 per cent said they’ll have to work longer – five additional years, on average – than they planned in 2008,” the article notes.
“And of those workers 50 and older, nearly half (47 per cent) had saved less than a quarter of their retirement goal,” a stat that CPA’s Patrick Culhane said was “staggering to us.”
For the full story, click here.

ARIA provides a forum for an informed discussion on retirement income adequacy, and other related issues, including pension and retirement coverage, and defined benefit pension plans.

 

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