Editorial 

Freedom 55 now a relic of the 20th century

I admit that I dream of retirement.

Don't get me wrong, I love my job, but there is no denying that lounging on a beach with no deadlines to meet, or just sitting in front of my fire with a good book on a snowy day sounds awfully appealing.

But in the real world those dreams are a long way off. As many in my generation are experiencing, we have young kids to get through school and any post secondary training they need, we have aging parents to help and we have debt.

Yes - that four letter word we all live with.

So it was with little surprise that I read the headlines about how baby boomers dreams of an early exodus to the couch are being dashed by the latest statistics.

Indeed one only had to register the fact that all those TV commercials taunting us with "Freedom 55" haven't been playing for a while to realize that we are going to be working to the bitter end - and then some.

Statistics Canada reports that we can expect to stay in the work force for at least three-and-a-half years longer than our counterparts in the 1990s.

I'd say that is conservative. When you look at how much later in our working lives many of us are able to afford to buy a home - if we can afford to buy one at all - the fact that people are having kids later, the cost of their education, I think many of us will be working for a decade longer than we thought we would be.

Consultants Towers Watson just released a Retirement Age index that shows most of us will be leaving the workforce at 67.

"It's very dramatic," Ian Markham, a senior actuary with Towers Watson in Toronto, told PostMedia.

"Canadians, especially in the private sector, are delaying their retirement. There's a general worry out there over whether they'll have enough money to live on."

There is no doubt that the 2008-2009 recession hit the savings and annuity purchase prices of later generations hard, delaying pension freedom well beyond age 60.

Many are also concerned about CPP and other pension plans in this on-going time of global economic challenge. The reality is you have to have a plan in place to provide for yourself if retirement is to be within reach at all. For many part of that plan right now is to just keep working.

Of course it's not all bad, according to government sources since the longer we keep working, or straggle out of the workforce, the easier it is to manage the potential impact of a mass exodus of workers.

Life expectancy has also increased so that means many will enjoy the same number of years retired we will just be older.

"Rapidly rising life expectancies, coupled with changing economic and social circumstances, have dramatically transformed our expectations with regard to the timing of important life transitions, and the way in which we anticipate that our golden years will be played out," Barbara Mitchell, professor of gerontology at Simon Fraser University told the Vancouver Sun.

When you consider that at least 44 per cent or eight million Canadians have neither an RRSP or an employer based registered pension plan the situation is even more serious.

Some financial analysts argue that one way to help with this is to get rid of the annuals tax-free contribution and instead give a lifetime accumulation limit of $2 million.

A recent poll by the CIBC found that B.C. residents are the most likely to work into retirement in Canada. There are many reasons for it  - not all financial.

The poll found that 80 per cent of B.C. residents doubted they would quit work by age 65.

One reason behind the trend, found CTV, was the high cost of housing in B.C. A study released by the University of British Columbia earlier this month found that housing prices in B.C. have seen the largest increase in the country since the mid-1970's - a staggering 149 per cent. Housing prices rose 76 per cent nationally in the same period.

B.C. is also the only province where household incomes have fallen in the same time period.

The study also found that young families are bringing in roughly the same income as those before them did nearly 30 years ago, even though most families are now duel-income.

Adding all this information up the conclusion can only be that people are working harder and longer and not necessarily getting ahead. For that reason it is even more important that all those seeking a seat on local council understand the reality we live in and keep financial responsibility at the forefront of their decision-making.

Most can't afford any more tax hikes and we certainly can't afford to do anything that might jeopardize the number of visitors coming to the resort.

 

 

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