Are you one of 5,000 today? Will you be one of 8,000 three years from now?
That’s how many Canadians are retiring each week – yes, each week – according to Mercer, a worldwide consulting firm focusing on businesses and their employees.
An article in Benefits Canada magazine notes retirees can expect to live, on average, seven years longer than those who retired in the 1980s. But their savings might not match that increased longevity.
Some 60 per cent of retirees rely on CPP, OAS and personal savings, according to Mercer’s Jean-Philippe Provost, senior partner and wealth business leader.
The rest tend to rely on a defined benefit pension plan, with payout based on years of service and income, or a defined contribution plan, with payout based on contributions and investment performance.
More and more employers are moving toward defined contribution plans, a system that shifts the payout responsibility – and risk – to the employee.
I always remember the personal assistant I had who, at age 21, was already planning for retirement.
But she was a rarity.
Provost said while millennials will make up an ever larger share of the workforce, only 10 per cent think about saving – and only five per cent see the link between saving today and preparing for retirement.
He encouraged employers to discuss retirement planning whenever the employee is inclined to listen – for example, when joining the company, becoming a parent, receiving a promotion, paying off a mortgage or asking for a flexible schedule to take care of an elderly relative.
These milestones can occur at any age, he said: “They could be 30 or 64. We don’t know when it’s going to happen.”
The RRSP season will soon be over for another year.
Hopefully you reviewed your plans and took steps to maximize your chances of experiencing those fabled golden years down the track.
But don’t stop now. Continue to take a good look at your (semi-)retirement planning every time you encounter a so-called milestone in your life. Your future depends on it.
Mike Grenby is a columnist and independent personal financial advisor; he’ll answer questions in this column as space allows but cannot reply personally – email [email protected].
