For those of us who aren’t yet retired, it’s difficult to put ourselves in the shoes of a retiree and imagine what issues they may be facing.

Save with SPP reached out recently to Bill VanGorder, Chief Policy Officer for C.A.R.P., a group that advocates for older adults, to find out what it’s like once you’re no longer working.

For a start, says VanGorder, all older people aren’t set for life with a good pension from their place of work. In fact, he says, “65 to 70 per cent of those reaching retirement age don’t have a (workplace) pension.”

As a result of that, most people are getting by on income from their own retirement savings, along with government benefits like the Canada Pension Plan (CPP), Old Age Security (OAS), and the Guaranteed Income Supplement (GIS).

“Politicians don’t understand what it’s like to live on a fixed income,” VanGorder explains, adding that any unexpected expenses hit those on a fixed income really hard. Right now in Nova Scotia C.A.R.P. is trying to stop plans to end a longstanding cap on property taxes – a move that would hit fixed-income folks the hardest.

In removing the cap, the province has suggested it would “look after” low-income seniors, but VanGorder points out that retirees at all levels of income are on fixed income. “It’s not just low-income earners… everyone would be hit by this,” he says.

It’s an example of how older Canadians seem to be overlooked when the government is writing up new public policies, VanGorder says. When the pandemic struck, all that older Canadians were offered was a one-time $300 payment, plus an extra $200 for the lower income group, he notes. Meanwhile younger Canadians were eligible for Canada Emergency Response Benefit payments of $2,000 per month, there were wage subsidies and rent subsidies for business, and more.

Older Canadians “feel they’ve seen every other part of the country get more economic assistance,” he explains. That’s because there’s a misconception that older Canadians “are already getting stuff… and are being looked after.”

“Their cost of living has gone up exponentially,” VanGorder says, noting that many services for seniors – getting volunteer drivers, or home support visits – have been curtailed for health reasons. These changes lead to increased costs for older Canadians, he explains.

C.A.R.P. is looking for ways to keep more money in the pockets of older people. For example, he notes, C.A.R.P. feels that there should be no minimum withdrawal rule for Registered Retirement Income Funds (RRIFs). “It’s unfair to force people to take their money out once they reach a certain age,” he explains. “A lot of people are retiring later (than age 71).” He notes that since taxes are paid on any amount withdrawn anyway, the government would always get its share eventually if there was no minimum withdrawal rule.

Another argument against the minimum withdrawal rule is the increase in longevity, VanGorder says. Ten per cent of kids born today will live to be over 100, he points out. “We’re adding a year more longevity for every decade,” he says.

C.A.R.P. is also pushing the federal government to move forward with election promises on increasing OAS payments for those over age 75, and to increase survivor benefits. While the feds did improve the CPP, the improvements will not impact today’s retirees; instead they’ll help millennials and younger generations following them.

Another area of concern to C.A.R.P. on the pension front is the rights of plan members when the company offering the pension goes under. “C.A.R.P. would like to see the plan members get super-priority creditor status,” he explains. That way, they’d be first in line to get money moved into their pensions when a Nortel or Sears-type situation occurs.

He notes that Canada is the only country with government-run healthcare that doesn’t also offer government-run pharmacare.

VanGorder agrees that there aren’t enough workplace pensions anymore. “Canada doesn’t mandate employers to offer pensions, making (reliance) on CPP and OAS more critical than it is in other countries,” he explains. The solutions would be forcing companies to offer a pension plan, or greatly increasing the benefits offered by OAS and CPP, he says.

“If we don’t start fixing it now, we are going to end up with a horrible problem when the millennials start to retire,” VanGorder predicts. Now is the time to act on expanding retirement security, he says. “They always say the best time to plant a tree is 20 years ago,” he says. “But the second-best time is today.”

We thank Bill VanGorder for taking the time to speak to Save with SPP.

Don’t have a pension plan at work? Not sure how to save on your own? The experts at the Saskatchewan Pension Plan can help you get your savings on track. SPP offers a well-run, low-cost defined contribution plan that invests the money you contribute, and provides you with the option of a lifetime pension when work’s in the rear-view mirror. An employer pension plan option is also available. See if they’re right for you!

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