July 15: BEST FROM THE BLOGOSPHERE
July 15, 2024
Canadians “losing sleep” over retirement fears?
Retirement is usually considered to be the reward that follows a long hard slog at the office – the pot of gold at the end of the rainbow of work.
But, writes Pia Araneta for Yahoo! Canada, anxiety about retirement “can have serious impacts on Canadians’ mental and physical health.”
She provides the example of Sandi Allen of Shoal Lake, Man., who “wants to retire… after almost 27 years of working long shifts with increasing demands.” The 57-year-old wants to spend more time with the grandkids and travel with her partner, writes Araneta, but “thanks to the increased cost of living, she feels more anxiety about the thought of retirement than excitement.”
“With hydro rates going up, the cost of fuel, taxes and groceries…I don’t know if we can afford to retire,” Allen states in the article. “I’ve been losing sleep over it.”
The article cites a 2021 study by the Healthcare of Ontario Pension Plan that found that “respondents were more concerned about the affordability of retirement than their own health.”
Even though she has a government pension, Allen says she worries if her pension plus Old Age Security “will be enough,” the article notes. “I wonder if my husband and I will actually be able to retire and live comfortably without worrying. Are we going to be able to enjoy our time,” she asks in the article.
Toronto’s Jannett Ionnides tells Yahoo! Canada that, at 64, she feels unable to retire, a fact she finds “depressing.”
“If I do retire, we would lose our house and have no place to live,” she tells Yahoo Canada. As well, the article notes, “Ioannides has had different professions throughout her life, trying to keep up with payments and `make ends meet.’ Her husband, who is 67, is retired but has since picked up two part-time jobs to help make payments.”
Worrying about money can have some serious health consequences, the article notes.
“According to the Financial Consumer Agency of Canada, if someone is dealing with financial stress, they are four times as likely to suffer from sleep problems, headaches and other illnesses such as high blood pressure and heart disease. Additionally, they are more likely to experience strain in their personal relationships,” the article notes.
Worse, the article adds, those of retirement age who have financial problems tend to keep that fact to themselves, worried they will cause problems for their children and family. “Financial stress at an older age can be isolating because some might not choose to share their situation with others, so they’re not seen as a burden,” the article explains.
The article, citing research from the National Institute on Ageing (NIA), says “retirement affordability” is becoming a real challenge.
“According to a 2023 ‘Aging in Canada Survey’ conducted by the NIA, only about one-third of working Canadians aged 50 and above who intend to retire said they can afford to do so at the desired time. Almost 40 per cent of respondents said they are not in the financial position to do so and 26 per cent said they are unsure of whether they can afford to retire at the time they want.”
The article concludes that the lack of retirement readiness is a growing issue that may “get even worse in years to come.”
The story underlines the importance of retirement savings – when you can no longer work, you will need to fall back on something, and the benefits provided by the Canada Pension Plan, OAS and so on are pretty modest. If you have a retirement savings plan through work, be sure to sign up and contribute to the max. If not, have a look at the Saskatchewan Pension Plan.
Open to all Canadians, SPP is a voluntary defined contribution plan. You decide how much you want to contribute each year – you can chip in any or all of your available registered retirement savings plan room. You can also transfer money in from other non-locked-in RRSPs.
SPP will take the money you provide and invest it in a professionally managed, low-fee pooled investment fund, growing it for your golden years. When it’s time to give up the parking spot at work, SPP provides you with several options for drawing retirement income, include the possibility of a lifetime monthly annuity payment or the flexible Variable Benefit option.
Check out SPP today!
Join the Wealthcare Revolution – follow SPP on Facebook!
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 and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.
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