Canadians are struggling to save for retirement, with many planning to push back the next phase of their life amid inflation and higher interest rates, according to a new survey from the Healthcare of Ontario Pension Plan.
Inflation has been slowly cooling in recent months, but at 4.4 per cent in April year over year it’s still more than double the central bank’s target rate of two per cent. The Bank of Canada last week raised its overnight rate to 4.75 per cent after several straight months of holding it steady, citing the risk of sticky inflation.
More than half of those surveyed aged 55 to 64 said if inflation keeps rising, they will have to push back their intended retirement date. Also, despite rising costs, almost 70 per cent of people surveyed said they would take lower pay in exchange for a better pension. Meanwhile, 78 per cent said they believe all employers should be required to contribute in some way towards pensions for workers.
To play devil’s advocate, retirement is a fairly recent phenomenon. It’s only come about en masse in the last 2 centuries, and most people would get a few years of retirement before they died if they were lucky.
Retirement age was set at 65 in the 1930s but back then life expectancy was only 60. Now it’s 81. So saving for retirement was much easier to do.
Plus those extra 15 years of life are some of the most expensive for the society in terms of a healthcare burden. Assuming life expectancy continues to rise, we’re going to have to stomach later retirement, barring some technological breakthrough like robot nurses
I’m glad to be living in our modern age. Worst case scenario, l have a one bedroom apartment and a gaming computer playing solitaire while being high AF listening to music on Spotify.