A staggering number of Canadians are approaching retirement age with insufficient funds to get them through their golden years, a new study has found, and the country could be facing a major upswing in seniors’ poverty rates as a result.
The study, conducted by the left-leaning Broadbent Institute, notes that half of Canadians aged 55 to 64 who are heading into retirement without an employer-supplied pension don’t have enough money set aside to make it through one year post-retirement – even after you factor in the income they’ll receive through Old Age Security, the Guaranteed Income Supplement and the Canada Pension Plan.
Around half of Canadians in the 55 to 64 age bracket don’t have an employer-supplied pension. Of those, the median value of retirement savings among the people making $25,000 to $50,000 is just $250. For those with incomes in the $50,000 to $100,000 range, it’s $21,000. The overall median value of retirement savings of those aged 55 to 64 with no employer pension is just over $3,000.
The study’s authors call that “wholly inadequate.”
Even as people are putting away less, the study also indicates that Old Age Security and Guaranteed Income Supplement guarantee levels are falling behind.
“Trends in income sources for seniors suggest that high poverty rates among seniors will further increase,” the researchers conclude, noting that those rates are already high, especially among women.
Rick Smith, Executive Director of the Broadbent Institute, said in a release that it’s up to governments to step in.
“Our new study shows now isn’t the time for Ottawa and the provinces to punt on expanding (the Canada Pension Plan),” Smith said. “In fact, we need federal leadership to make this happen. Boosting the Guaranteed Income Supplement by 10 per cent for single seniors is a start, but not nearly enough.”
The full report is available online here.