In an eye-opening new study it would appear A LOT of Canadian are going to be shocked to find themselves living in poverty after retirement. The study, from the Broadbent Institute, based its findings on Statistics Canada and found 15 to 20 per cent of middle-income Canadians retiring without an employer pension plan have not remotely saved enough to have a liveable retirement and people, now aged 55 to 64, face their senior years in poverty.
How many of us do not have an employer pension plan? It’s estimated around 47 per cent… and the scary news is that even fewer younger workers have employer pensions.The report’s author found that the median value of retirement assets of Canadians age 55 to 64 is just over $3,000 and although they’ll get the CPP/QPP and OAS/GIS in most cases, which brings them to an average of $15,970 annually for singles and $25,746 for couples it simply won’t be enough. These amounts are only meant to be supplements to incomes and the study says as things look now, only half have savings that represent less than one year’s worth of the resources they need to supplement OAS/GIS and CPP/QPP.
Trends
Senior poverty has been rising since 1995. When taken against the low-income measure, the number living in poverty has risen from 3.9 per cent to 11.1 per cent which means 719,000 poor seniors, including 469,000 single men and women.
Its a situation that analysts says 10 or 15 years down the road, there will be a lot of folks with no disposable income making it bad for them and bad for the economy in general.
Solutions?
It has been suggested that the federal government move quickly on CPP reform and to think about enhancing the GIS benefit for both singles and couples as these recent findings paint a grim picture for future pensionless individuals and raises questions about the adequacy of benefits from Old Age Security, the Guaranteed Income Supplement, and the Quebec and Canada pension plans.
BOTTOM LINE: If your not getting an employer pension plan and your not saving your pennies, things don’t look promising. View the actual study HERE
ABOUT THE BROADBENT INSTITUTE: The Broadbent Institute, created by former NDP MP Ed Broadbent, studies Canadian public policy issues with a view to make Canada a more equitable society.
What do you think. Are you ready for retirement?
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