We’ve all seen how expensive housing – either through home ownership or renting – has become in 2023.

Are we going to head back to the good old days, when two, three or more generations lived under the same roof to share the costs of housing? Save with SPP took a look around to see if multi-generational living is a thing.

Turns out, it is!

According to the Vanier Institute, data from the Canadian census show that multi-generational households “have become the fastest-growing census family household type in recent decades.” As of the 2021 census, the article continues, “there were nearly 442,000 multi-generational households in Canada,” and while this accounts for only 2.9 per cent of the total households, it represents “2.4 million people, or 6.4 per cent of the total population.”

As well, the Institute notes, “multigenerational households have increased in number by 50 per cent since 2001.” Additionally, in 2021 “nine per cent of children aged 14 and under (571,000) lived with at least one grandparent, up from 3.3 per cent in 2001.”

The article cites a number of factors for this increase. First, there’s the fact that the population is aging, and life expectancy is rising. “Population aging intersects with other trends such as intergenerational care needs, rising housing costs, and growing population of groups more likely to share a roof with younger generations, contributing to the growth in multigenerational households.”

So what is it like when two or more generations share the same dwelling?

Writing in The Globe and Mail Ben Mussett cites the example of Vancouver’s Stephen Reid.

“Every morning, before his three-year-old granddaughter heads to daycare, Stephen Reid is waiting at the bottom of the stairs to wish her a good day. Unlike many grandparents, Mr. Reid hasn’t had to forgo seeing his only grandchild during the pandemic. In fact, he’s spent time with her nearly every day of her life,” writes Mussett.

“This is possible because Mr. Reid and his wife, Melanie, have lived with their daughter Michelle Cyca and her family for the past three years in Vancouver. Their living arrangement allows the Reids to provide child care in a pinch. Likewise, Ms. Cyca and her husband have been there for her 71-year-old parents, who both deal with chronic health and mobility issues,” he notes.

So, three generations, one house, and they are all looking after each other. Nice!

Over at the National Post we learn about Ottawa’s Yi Jiang.

“About a year after Yi Jiang and her family moved to Ottawa from China, they found themselves sharing a two-bedroom apartment with her parents,” the article notes.

“After living together in Shenzhen, it seemed only natural that once the entire family was in Canada, her parents would live with her, her husband and their young son, she said. The couple has since had another child, and last year all six moved to a house in the suburbs,” the Post reports.

“It’s very important for me to live with them … they are the most important people in my life and I am the only child,” Jiang, a producer for a Mandarin radio show, tells the Post.

The article goes on to note that multi-generational living is a new trend that has roots in long-ago times.

“Right now, the proportion of multigenerational households is high, relative to recent history, but if you go back pre-war, most households were multigenerational; somebody always took in Mom or Dad,” Nora Spinks of the Vanier Institute tells the Post.

“It was only through that weird blip post-war 1950s, 1960s where every generation had their own household, and you moved out at 18 or 19, and you got your own apartment and you never returned home and everybody had their own toaster and everybody had their own everything,” she states in the article.

There is also some hope that multi-generational housing can be part of the solution to the general housing shortage crisis, the CBC reports.

Recently, the article notes, the federal government “introduced a tax credit for families looking to renovate their homes and accommodate more people,” the broadcaster reports.

“It provides a one-time 15 per cent tax refund for renovation costs up to $50,000 for a secondary unit with a private entrance, kitchen, and bathroom,” the CBC reports, adding “to be eligible, the resident of the renovated unit must be a family member who is a senior or an adult with a disability.” The maximum refund amount is $7,500, the article notes.

It will be interesting to see if this trend continues during this odd period of high rents and high mortgage rates.

Whether you retire on your own, or as a couple, or with your folks in one room and the kids in another, you’ll need money to cover expenses, even if they are shared. If you are fortunate enough to have a retirement program at work, be sure to join it and participate to the max. If you don’t have a program, or want to augment the one you have, take a look at the Saskatchewan Pension Plan.

With SPP, you decide how much you want to contribute – your contributions are tax-deductible. SPP then does the heavy lifting of investing your savings in a low-cost, professionally managed, pooled fund. When it’s time to call it a day for good at the office, SPP will help your turn those savings into retirement income, with the option of you receiving a lifetime monthly annuity payment in respect of some or all of your savings.

Great news! SPP’s flexible Variable Benefit option is no longer limited to those members living within the borders of Saskatchewan. Now all retiring SPP members across the country can take advantage of this provision, which puts you in control of how much income you want to withdraw, and when you want to withdraw it. You can also transfer in additional savings from other unlocked registered sources. For full details see SaskPension.com.

Check out SPP today!

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When you think of retirement from a woman’s point of view, you see an array of challenges.

Writing in the National Post Christine Ibbotson observes that women “tend to live longer than men, and many divorced women or widows are simply choosing to remain single in retirement.”

This creates a “unique challenge” for them, she continues. “Many retired women receive much less than their male counterparts. Often, women have not worked the same amount of years as men, or have earned less income during their working careers, and therefore do not receive the same pension benefits.”

As well, Ibbotson continues, women may tend to be more “risk averse” with investing. Recent research from BMO found that “men were more likely to hold stocks and mutual funds in their investments whereas women were more likely to hold guaranteed investment certificates (GICs).”

An infographic from Eckler Partners provides more details on these factors.

In 2017, a woman could expect to live to age 83 on average — for men, the number is 79, the article notes. Sixty-two per cent of women were likely to take a break from work to care for their kids, compared to only 22 per cent of men, the Eckler research continues.

Scariest of all — 51 per cent of Canadian woman “haven’t even started to save for retirement or know how much they plan to save,” the article notes. A whopping 92 per cent of women surveyed say they have “minimal or no knowledge of investment.”

So, to sum it up, women — who live the longest — earn, on average, just 69 cents for every dollar men earn in Canada, Eckler reports. That means they have less money to save for a retirement that is almost bound to last longer than a man’s.

An article from the Wealthtender blog expands on the idea about women earning less than men, and its impact on retirement saving.

The article cites Merrill Lynch research in the U.S. as noting that “when a woman reaches retirement age, she may have earned a cumulative $1.05 million less than a man who has stayed continuously in the workforce.”

This necessarily means there is substantially less money to save for retirement by women, the article adds.

An article from Kiplinger suggests that women take a good look at annuities when they retire.

Noting that women earn less, and thus get lower government retirement benefits, the article underlines the idea that “women live longer, so their savings have to last longer.”

While the article is written for a U.S. audience, it makes the point that through an annuity, savings can be turned into “a guaranteed stream of lifetime income, paid monthly, no matter how long that is… in other words, a woman can use it to create a private pension.”

The article quotes University of Pennsylvania economist David Babbel as recommending that lifetime annuities should “comprise 40 to 80 per cent of their retirement assets.”

What can women do to close the retirement savings gap — apart from considering annuities?

Ibbotson recommends they “start by educating” themselves… “when we know more, we make better decisions and feel more empowered to improve our situation.”

“Start to know what your financial picture looks like. Buy a notebook and create a budget — your new financial plan,” she writes. Financial advisers and accountants are recommended, she writes, and your retirement savings portfolio needs to be designed “to grow with products that that offset inflation and taxes.”

The Wealthtender article adds a couple of other good points.

Focus on increasing financial literacy, the article suggests, by reading financial blogs, listening to related podcasts, and watching online videos on the topic of personal finance.

As well, the article concludes, women should focus on the future.

“Acknowledge early on that you may spend a big part of your life on your own, so always make saving one of your biggest priorities. Even if it’s just saving an extra $50 extra per month or increasing… your contribution by one to two per cent, the money can really add up over time.”

If you have a pension plan at work, be sure to join up, and participate to the max. Many plans will allow you to do “buybacks,” and make contributions after you are back at work for periods when you were away. This can really help fatten up your future pension cheque.

If you don’t have a pension plan at work, a great program to know about is the Saskatchewan Pension Plan. It’s open to any Canadian with registered retirement savings plan (RRSP) room. Your contributions are invested in a pooled fund, featuring low-cost expert management. When it’s time to retire, SPP will help you turn your savings into retirement income, including the possibility of a lifetime annuity.

And now, there are no limits from SPP on how much you can contribute each year, or transfer in from an RRSP. You can contribute any amount (up to your available RRSP room) and transfer in any amount from your RRSP. The possibilities are limitless!

Join the Wealthcare Revolution – follow SPP on Facebook!

Carrying debt into retirement can “tarnish your golden years”

When our parents and grandparents happily rolled into full retirement years ago, it was a rare thing indeed for them to hit the golden years with mortgage or other debt.

It’s much more common today, and a recent article from the National Post warns that it’s non-mortgage debt that’s the thing you should avoid taking into retirement.

“Millions of Canadians spend their working days dreaming about retirement. Yet millions of Canadians also may not take into consideration the crucial financial steps they should take to become a retiree,” the article begins.

And while most of us get that retirement – a time when nearly all of us will have less income – is a bad time to have debt, we don’t always concentrate on paying down the right debts before we retire, the article continues.

“While many understand it’s important to pay down loans, they’re often focusing on the wrong ones — prioritizing their mortgages, which have lower interest rates, rather than expensive high-interest accounts,” the Post reports.

Your first goal should be paying off “personal loans and credit cards,” which carry the highest interest rates of all, the article advises. Credit cards currently carrying interest rates ranging from 19.9 to 22.99 per cent in Canada, the Post notes.

A lot of times, the article warns, we tend to put major expenses on credit cards – moving, wedding or funeral costs are cited – which can lead to large unpaid balances.

The article suggests “lowering your mortgage payments to use those funds to pay down other high-interest loans.”

“Mortgages,” the Post reports, “have lower interest, which will allow you to hold onto your savings and pay down debt. From there, start putting cash aside in an emergency fund with about three months of wages. That way, if unexpected expenses come your way, you’ll be ready.”

The other form of debt the Post urges us all not to take into retirement is loans for vehicle purchases.

“Auto loans are another area to pay off before retirement. As of July 2022, the average interest rate for a car loan was 6.62 per cent, according to Statistics Canada,” the article notes.

“But if you have bad credit, that soars up to 19 per cent. That’s about as much as the interest rate on a credit card,” the Post warns.

The article suggests that you might want to hold off on your retirement plans and address these types of debt first.

“If you hold off on retirement to pay off these loans, putting aside wages to pay them down, you could be saving yourself thousands in interest and creating a cushion to retire on,” the article concludes.

This is good advice. When you retire, you will almost always receive less income per month than you did from work. Lots of work-related expenses fall by the way – no Canada Pension Plan, company pension, or Employment Insurance premiums are deducted from pension or retirement savings income, and you may save on union dues (retiree dues are less), workplace parking, and so on. If your income is less than it was at work, your government income taxes will be lower also.

If, as the article says, you can also eliminate (or lower) monthly payments for a mortgage, car loan, credit cards or lines of credit, it will help your retirement cash flow immensely.

While paying down debt is always good advice, it’s also wise to direct at least some of your income towards retirement savings. If you don’t have a pension plan at work, and don’t really want to wade into the volatile waters of investing, consider the Saskatchewan Pension Plan. Any Canadian with registered retirement savings plan room can join, and you can contribute any amount to your account, up to $7,000 per year. SPP will grow those savings into future retirement income.

Join the Wealthcare Revolution – follow SPP on Facebook!

If there can be a silver lining in this dark cloud that is the pandemic, it might be the fact that so-called “domestic tourism,” or seeing Canada first, is on the upswing. According to the National Post, domestic bookings jumped 30 per cent in 2020 over 2019.

“What we are seeing in Canada is similar to what we have seen in North America and globally. People can’t travel abroad, so they are finding spaces within their own states or counties or countries to visit,” Chris Lehane of Airbnb told the Post last year. “We have seen a real increase in domestic travel.”

One reason for that, the CBC reports, may be the cost of an out-of-country vacation.

First off, the prices of air travel and car rentals “are on the rise,” the broadcaster reports, and as well, you may be made to take COVID-19 tests to get back home.

“Depending on where you’re travelling to, you may have to shell out for two COVID-19 tests, which can add hundreds of dollars to your travel costs,” the CBC reports. As this blog is being written the requirement for a test to go on a short trip to the U.S. has been dropped, but rules are still in place for longer trips.

The CBC story looks at the case of the Wilson-Paradis family of Peterborough, Ont., who planned a trip to Vegas earlier this year. At that time, however, it would have cost $1,000 for five PCR tests so they could fly back to Canada.  “It was very disappointing,” Ian Wilson told the CBC. “I’m not opposed to getting the test … but it’s the cost. It was just adding too much onto the trip for our family to afford.”

So, why not see Canada instead?

According to CP24, the Ontario government has announced a tax credit for Ontarians who plan a “staycation” within the province.  Ontarians planning an in-province vacation in 2022 could get a tax credit of $1,000 for an individual, and $2,000 for a family, if they “stay for less than a month at… a hotel, motel, resort, lodge, bed and breakfast or campground,” CP24 reports. The province, the broadcaster says, hopes the credit “will help the tourism and hospitality sectors recover and encourage Ontarians to explore the province.”

Our huge country, bounded by three oceans, has a lot to see – the beautiful B.C. coast and the Rockies, shared with Alberta. The vast blue skies and flowing wheat fields of the prairie provinces. Big city fun in Vancouver, Toronto and Montreal. The east coast, with its sweeping seacoast vistas and amazing history and tradition. We have a lot to see right here at home.

And if you’re planning a little travelling once work is in the rear-view mirror, consider the Saskatchewan Pension Plan as a go-to resource. The SPP will take your contributions, invest them in a pooled, professionally managed investment fund featuring a low management expense, and grow them for you. When the day comes to turn savings into retirement spending, you have many options from SPP, including that of a lifetime pension.

Be sure to check out SPP!

Join the Wealthcare Revolution – follow SPP on Facebook!

Those of us of a certain age can remember when cash was king. Back in the day, few had credit cards, “tap” purchases were decades away in the future, and – minus a mobile phone, which was still being invented – you needed change to make a phone call when away from your landline.

Bills were paid by cheque, or directly at your bank branch, where there was a massive lineup out to the street on pay day.

The pandemic seems to have speeded up an already “in progress” move away from cash. Save with SPP took a look around to see what people are making of this development.

Writing in the Globe and Mail, Casey Plett notes that the idea that we are becoming “a cashless society” has turned into “a common belief… as if currency were simply one of so many Old World analog relics circling the drain before they gurgle into oblivion.”

Her article notes that during the early days of COVID-19, the use of cash “was phased out entirely” by many institutions over fears that money might actually help the pandemic spread more quickly. Even though such concerns have now been addressed, the use of cash has not resumed at pre-COVID levels, she notes.

“But a cashless society is not a foregone conclusion,” Plett writes in the Globe. “And while it may seem like a fuddy-duddy Luddite concern – the equivalent of clinging to one’s touch-tone phone, perhaps, or making a plea for beepers – a complete societal changeover to non-cash payment would not, in fact, be a good thing.”

She says a fully cashless society would be “inequitable” for those – such as the vulnerable and the homeless – who don’t have access to the banking system. Her article cites figures from the Canadian Centre for Policy Alternatives showing that an astounding one million Canadians (as of 2016) were “bankless,” and five million more “underbanked.” This latter group may have a bank account, but no credit or other banking services.

She also points out that cash can be indispensable when the Internet goes out, your credit card is locked for mysterious reasons, or if there’s a power outage (remember 2003). Cash, she writes, “is a refuge of privacy,” in that your purchases with it aren’t tracked or marketed. She concludes by saying it would be unwise for governments to move away from it altogether.

Even before the pandemic was an idea, the National Post was predicting the end of cash would arrive five years ago in 2016.

The Post cited research from 2016 showing that 77 per cent of respondents “preferred to pay for purchases by debit or credit card,” and that 65 per cent said “they rarely buy anything with cash anymore.”

In that article, Rob Cameron of Moneris is quoted as saying ““I do think people will continue to use cash because it’s been around so long…. But this growth in contactless (payments using credit cards or mobile apps) I think is going to lead towards that end of cash.”

Figures from the Bank of Canada show that there is a trend away from cash. As recently as 2009, the bank reports, 54 per cent of transactions were made using cash. By 2013 that number dipped to 42 per cent and by 2017, 33 per cent.

“So, does this mean that Canadians are giving up on cash?,” asks the Bank of Canada. “The short answer is no. Canadians still rate cash as easy to use, low in cost, secure and nearly universally accepted, and it’s the preferred payment option for small-value purchases like a cup of coffee or a muffin.”

Well, maybe. Last word on the topic goes to economist Eswar Prasad, who tells CNBC that “the combination of cryptocurrency, stablecoins, central bank digital currencies (CBDCs) and other digital payment systems will lead to the demise of [physical] cash.”

The takeaway here is that all of us need to try and stay current with new trends. Cash is being joined by many other ways to pay. Even when we were out distributing poppies for the Legion in October we found that many people did not have any cash, or had to run to their cars and dig around for change. So, the Legion has begun to roll out “tap” poppy boxes.

Personally, we think cash will never entirely fade away. Think of big trends in music – punk, disco, progressive rock. Sure, you don’t see chart-topping music in those categories any more, but it is still being played, and in some corners of the globe, being developed.

No matter how you choose to spend it, you will appreciate having some form of currency when you retire. If you are saving on your own for retirement, consider the help of the Saskatchewan Pension Plan. The plan offers an end-to-end pension service; and once you are a member, you can contribute to your savings by cheque, through online bill payment, with automatic deposits, or even with a credit card. Be sure to check out SPP today!

Join the Wealthcare Revolution – follow SPP on Facebook!

Will some Canadians stay frugal and keep saving – even after the pandemic?

An interesting report from BNN Bloomberg suggests that a significant chunk of us Canadians plan to carry on being savers – and trimming back on spending – once the pandemic is over.

The report cites recent Scotiabank research, which found that 36 per cent of those surveyed “are planning to eliminate unnecessary spending from their lifestyle,” and a further 28 per cent “will continue to build their emergency fund.”

Scotiabank’s D’Arcy McDonald is quoted in the article as saying there is a “record number of deposits in Canadians’ bank accounts.” He further states that this stash of cash “presents a huge opportunity, especially for the sectors hardest hit by the pandemic, like travel and hospitality.”

In plainer terms, he’s expecting Canadians will spend that cache of cash on things they haven’t been able to do, like jumping on a jet plane, or even taking friends out for dinner. And the research seems to bear that out – but with more than a third of respondents promising NOT to spend money like they did before, and nearly 30 per cent more putting money in long-term savings, one wonders if it will play out like bankers and politicians expect.

A higher savings rate is never a bad thing. As recently as 2017, according to the CBC, the national household savings rate was about 4.6 per cent, and 65 per cent of Canadians said they were saving for retirement.

Jump ahead to 2020, and – according to the National Post – we have a national savings rate of 28.2 per cent, and an estimate cash stockpile of $90 billion. And that number solely looks at savings accounts, the article notes – if invested dollars were counted, the number would be even higher.

Are any of the excess dollars being earmarked for retirement?

It would appear so. According to the Canada Buzz blog, the average registered retirement savings plan (RRSP) balance in Canada is around the $100,000 mark – it averages $92,000 and change in the Prairies and hits $116,000 in Alberta. B.C. weighs in at $96,000-plus and Ontario leads at $128,000.

The pandemic has been a nightmare for some of us, who have seen jobs and paycheques dry up, or who have been forced to close businesses. Retirement savings is of course not a priority for this group. But if you are someone who has managed to keep working throughout the crisis, and have built up some extra savings, don’t forget about your retirement savings account. Those dollars will be handy for the retired, future you.

The Saskatchewan Pension Plan, celebrating its 35^th year of operations, is of course a logical destination for any excess cash you may want to earmark for the future. SPP invests the contributions on your behalf, and at retirement, can convert your invested dollars to a retirement income stream. Check them out today!

Join the Wealthcare Revolution – follow SPP on Facebook!

We’ve all been told, repeatedly, about the various public health and safety measures we can follow to try and reduce the risk of catching COVID-19. Up to now, it has been physical distancing – staying two metres apart – plus masks, hand sanitizing, and staying at home as often as possible.

Some folks say these steps are causing other problems, particularly the idea of isolation.

Writing in the Toronto Sun, columnist Sue-Ann Levy asks “if Ontario residents are distressed and frustrated by the latest lockdown, think of what a living hell it must be for seniors confined to their rooms in long-term care and retirement homes for now what is going into our 11th month of pandemic restrictions.”

The article notes that isolation is particularly harmful for the mental health of seniors. It’s not great for the rest of us, warns an article in the Sarnia-Lambton (Ontario) Journal. Public health officials in the Southwestern Ontario city say they are seeing a rise in domestic abuse there.

“Social isolation, financial instability and reduced access to friends and family has increased both the level of violence and its intensity,” the article reports, quoting Ange Marks, executive director of the Women’s Interval Home in the area.

Similarly, an opinion article in the Chicago Sun-Times warns that remote learning also has downsides for the kids.

“Evidence from the first year of the pandemic in the United States suggests that the social isolation created by school closures has exacerbated an ongoing childhood mental health crisis,” warn five doctors from the Chicago area.

Even the masks themselves are getting into the headlines. Is one sufficient, a report in the National Post, or should we wear two?

“If you have a physical covering with one layer, you put another layer on, it just makes common sense that it likely would be more effective,” states Dr. Anthony Fauci in the Post article.

That’s a lot to take in. Are there other approaches we can take that might be a little easier to handle?

Well, yes, people are hard at work on new approaches.

In Malaysia, reports Bernama, researchers are working on a new method to detect the virus using DNA and fibre optic sensors.

In Nova Scotia, reports Global News contract tracing will soon be much easier thanks to a new app that tracks restaurant patrons all over the province.

Up to now, the work of contract tracing has been done with dozens of different methods, but mostly pen and paper. “It is our hope that contact tracing will assist in preventing the spread of COVID-19 and help get us one step closer to a pandemic-free future,” states Gordon Stewart of the province’s Restaurant Association in the Global article.

Other research is being carried out on whether air purifiers might have a role to play in lessening the risk of COVID-19 infections, according to a second Global News report. The kinks of this approach are still being worked out, but it is believed that an air purifier with a HEPA filter, if correctly positioned, can help “remove viruses and germs from the atmosphere.”

We’ve all read about the various (and numerous) vaccines that are being rolled out, and administered across Canada.

Putting all this together, yes, the distancing and masking and isolation are tough medicine. But humans are an innovative bunch, and the same innovation that led to the rapid development of new vaccines is helping with new treatment approaches. That allows all of us to take a moment, now and then, to think of life after the pandemic.

The post-pandemic world, for many of us, will represent the run-up to retirement. If you don’t have a plan for retirement, the Saskatchewan Pension Plan could be a plan for you. Once you’ve joined up, you can contribute at any rate you choose, up to $6,600 per year (subject to available RRSP room). The SPP will invest that money (they’ve averaged an annual return of eight per cent since the plan’s inception 35 years ago) and, when work is done, can turn your invested cash into a lifetime income stream. Why not check them out today!

Join the Wealthcare Revolution – follow SPP on Facebook!

Most Canadians understand the Canada Pension Plan (CPP) – we pay into it, as does our employer, and we can start collecting a lifetime pension from it as early as age 60. But what about the other “pillar” of the federal government’s retirement income program, Old Age Security (OAS)?

The federal government says OAS is available to any Canadian who has lived in our country for 40 years after reaching age 18. If you don’t meet those conditions, you may still qualify under complex “exception” rules.

Currently, the maximum OAS payment  is $613.53 per month, for life. It starts at age 65, but you can choose to defer it for up to 60 months after reaching that age – and if you do, you will receive a payment that is 36 per cent higher.

There is, of course, a big catch to this. If you make more than $75,910, the government will charge what they call an “OAS recovery tax,” or clawback. If you make more than $123,386, you have to pay back all of your OAS payments for the year.

The “conditional” yet “universal” benefit has prompted many to come up with ideas on how to fix it, particularly during the Stephen Harper years.

Back then, a Fraser Institute opinion column in the National Post explained one key problem with OAS. “Unlike the CPP, there is no dedicated fund to pay for OAS,” the column notes. “Benefits are funded with current tax revenues.” Put another way, everyone who pays taxes contributes to OAS, but not everyone gets it – and should higher income earners get it at all, the column asks.

The Fraser Institute recommended lowering the income at which OAS begins to be cut off to around $51,000, with the full clawback moving to $97,000. This, the article suggests, would save the government $730 million per year, since fewer people would receive the full amount.

Another solution – the one that the Conservatives planned to implement – was moving the starting age for OAS to 67 from 65. However, the current Liberal government reversed that decision in 2016, notes Jim Yih’s Retire Happy blog.

But in the intervening years, we have seen debt levels increase dramatically, preventing many of us from saving for retirement. So there are now some arguing for an expansion of the existing system, on the grounds that it doesn’t provide seniors with sufficient income. Indeed, the Liberals campaigned last year on a plan to increase old age security “by 10 per cent once a senior reaches age 75,” reports Global News.

Without getting political, it appears we have come full circle from talk of reforming the OAS and making it harder to get, to talk of increasing its payout for older seniors. Let’s hope governments take a longer-term view of the problem, and focus on ways to better fund OAS – perhaps creating an OAS investment fund similar to what CPP has, one that would make this benefit more sustainable and secure for those who rely on it.

If you are one of the many hardworking people who lack a workplace pension plan, there is a do-it-yourself option that you should be aware of. It’s the Saskatchewan Pension Plan (SPP). They’ll grow the money you contribute to the plan over time, and when it’s time to retire, can pay it out to you in the form of a “made-by-you” lifetime pension. The SPP also has options for your employer to use this plan as an employee benefit.  Check them out 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 and classic rock. He and his wife live with their Shelties, Duncan and Phoebe, and cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22

Politicians all over the continent like to point to our low levels of unemployment as a sign that our economy is booming and recovering.  And perhaps it is. A recent Bloomberg article notes that the Canadian labour market has seen “a decade-low unemployment rate” and “some of the fastest job gains on record.”

That high level of employment, the article adds, boosted “the average weekly earnings for Canadian workers… 3.4 per cent in May from a year earlier, to $1,031.” There were a whopping 32,600 jobs added that month, Bloomberg reports, citing Statistic Canada figures.

Reading these positive numbers, one might include that things look great for our younger workers – low unemployment and a high level of job creation.

Not so fast, reports Livio Di Matteo of the Fraser Institute, writing in the National Post. Sure, the story notes, we can expect that “in coming years employment and the labour force in Canada will continue growing,” but it will be “at a diminished rate, with employment growing slightly faster than the labour force.”

And the reason why, Di Matteo explains, is that low unemployment rates are “due largely to our aging population and the expected decline in labour force participation rates. Overall labour force participation in Canada has declined over the past decade in Canada, but interestingly has grown among people aged 55 and older.” In plainer terms, there are more older people in the workforce than before, meaning those at or nearing retirement age are continuing to work.

Di Matteo suggests that there will be more opportunities for younger workers when boomers begin to fully retire. In 2016, “people aged 55 and over accounted for 36 per cent of Canada’s working age population,” Di Matteo notes, adding that this figure should rise to 40 per cent by 2026. When the boomer cohort finally begins to retire, Di Matteo predicts higher demand for younger workers in “healthcare, computer system design… support services for mining, oil and gas extraction, social assistance, legal, accounting… and entertainment,” among others.

It’s a similar story south of the border, reports Market Watch. There, unemployment is “at a half-century low,” but a reason why is that there aren’t as many new entrants in the job market, the report notes.

“The U.S. doesn’t need to create as many new jobs to absorb a slower growing population of working-age Americans. Economists figure the U.S. needs to add less than 80,000 new jobs a month to hold the unemployment rate near its remarkably low rate,” the article states.

Experts are split on whether boomers are working late into life because they want to or because they have to. Sure, many love the social contacts and engagement of working – or want to travel more now that they are semi-retired. But those still saving for retirement may not be hitting their savings targets.

A report from RBC, covered in Yahoo! Finance Canada, says those boomers with “investable assets” of $100,000 or more planned on saving $949,000 for retirement, and “are falling $275,000 short.” Those with less than $100,000 saved have lesser goals, but are much farther away from them, the report states.

It will be interesting to see how the trend towards boomers hanging on to their jobs plays out, as it ultimately must.

For those of us who are still slogging away in the workforce, all these stats underline the importance of directing some of your income towards long-term savings for retirement. An excellent tool for this purpose is the Saskatchewan Pension Plan, which offers a flexible way for your savings to be invested, grown, and ultimately paid out to you as a lifetime pension in the future. It may be better to pay into your own retirement now, rather than having to work later in life to fund it.

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. He and his wife live with their Shelties, Duncan and Phoebe, and cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22

“Canadian dream” far more difficult to achieve for younger Canadians 

For boomers, the “Canadian dream” more or less echoed the dream our parents had – education, work, a house, a family, maybe even a cottage, and then a well-deserved retirement.

Research (using 2015 data) shows there is a serious flaw in this narrative for our millennial children. According to research from the Organization for Economic Co-operation and Development (OECD), featured in a National Post article, millennials are “less likely to reach middle-income levels in their 20s than their baby boomer parents.”

Why aren’t our kids making it to the middle class?

The research suggests “the middle class is shrinking — squeezed by high housing and education costs, displaced by automation and lacking the skills most valued in the digital economy.” The middle class is defined, for a single person in Canada, as requiring an income level of 75 to 200 per cent of the national median income, the article reports. For single Canucks, that’s $29,000 to about $78,000, the story notes.

One of the unfortunate aspects of this so-called dream is that in order to advance upwards, you have to achieve each step of the ladder. Education costs have skyrocketed in the last few decades, forcing younger people to have to take out huge education loans. Wages from work, the article notes, aren’t keeping up with the real cost of living. According to the OECD research, “between 2008 and 2016 real median incomes grew by an average of just 0.3 per cent per year,” compared to 1.6 per cent annually in the mid-1990s to 2000s.

So the wages from work aren’t sufficient for housing, with middle-income earners having to spend “almost a third of their income on accommodation,” the report states. In the 1990s, that figure was more like 25 per cent.  That’s why our millennials struggle to get to the “getting a house” stage, and if they can afford to start a family, is there anything left over for that dream cottage and longish retirement?

According to the Seeking Alpha blog, the answer is probably no. “At 1.1%, the Canadian saving rate is today near all-time lows, while Canadian debt is at all-time highs,” the blog notes. There’s an obvious reason – wages haven’t kept up with the cost of housing, so the younger folks are straining just to cover the mortgage. There’s less left for saving.

Research by Richard Shillington has found that even boomers aren’t awash in savings as they approach retirement. His study found that 47 per cent of Canadians aged 55 to 64 have “no accrued pension benefits,” and that for this age group, the median level of retirement savings was a paltry $3,000.

There’s still time to turn this ship around. Policy makers should continue to look at ways to help new people enter the housing market, and perhaps old ideas like housing co-operatives – popular when high interest rates restricted people from owning homes – should be revisited. Ways to make education less costly would be a huge help. Improved government pension benefits are a help, but why not continue to develop new workplace pension plans – or continue to encourage private employers to join publicly-run plans? Any policy that helps Canadians move up that middle class ladder is worth exploring.

If you’re among the many Canadians lacking a pension plan at work, the Saskatchewan Pension Plan is designed with you in mind. You determine how much you want to save, and they do the rest, investing your money through your working years and arranging to pay you a monthly lifetime pension at the finish line. Even a small start can make a big difference down the road.

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. He and his wife live with their Shelties, Duncan and Phoebe, and cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22