Two big surprises about retirement in Canada

I have been perplexed and caught off guard by what I have been reading about retirement in Canada lately. Two conundrums have been puzzling me. The Luxembourg Income Study Database claims the Canadian middle class is the richest along with Britain, and richer than our American counterparts! Great news. But, meanwhile, the elderly poverty rate has been rising since the mid 1990’s and then there are the bankruptcy rates for the over 65 crowd to consider!

If that does not twist your head around, try this one. Canada still does not have any health policy at the federal or provincial levels to deal with an aging population. Heads are apparently buried solidly in the sand of denial. How can we not be addressing our aging population in terms of health care? Baby Boomers may be healthier than the previous generation but subject to the slings and arrows of outrageous health fortune like anyone else. And there are so many!

The rich get richer but the poor get poorer

The New York Times announced in April that the Canadian middle class was now richer than our American counterpart in after tax dollars. After 2008, our real estate prices held up, we have larger and stronger labour unions, and lower prescription and medical costs. According to that Luxembourg study, middle income Brits and Canadians are tied for median income growth since 2000 at 19.7 per cent while Americans have been stagnant at 0.3 per cent. I guess the rich are much richer, but, unfortunately,the poor are also poorer.

At the same time, the Conference Board of Canada did a study that points out that income inequality in Canada has increased over the last 20 years with the richest gaining share and the poor and middle income losing share.

Perhaps the hollowing out of the American middle class has been more aggressive but it appears to be happening here as well. In addition, The Vanier Institute for the Family’s report on family finances tell us that the insolvency and bankruptcy rates for the 65 and over group is the highest in the country. These are people who, for the most part, would have declared themselves members of the middle class.

The Financial Consumer Agency of Canada says that the number of Canadians working past 65 has doubled over the last 7 years, and that this growth is expected to continue. Much of this growth is fueled by perceived financial necessity. This may have much to do with our debt levels of $1.64 for every $1.00 earned. “I owe, I owe. It’s off to work we go!” It was the best of times; it was the worst of times it appears.

No health policy

Here is another puzzle to confound the mind. About two thirds of Canadians cite health as their biggest concern as they age but only about 22 per cent have planned or saved for a medical issue. A federal election is on the horizon but discussion or policy suggestions for health care for the coming increase in the aging population is not. Not yet, anyway. The Canada Health Act is federal legislation which deals with transfer payments to the provinces who then organize and deliver care. Those transfer payments are not increasing.

By 2050, 31 per cent of our population will be over the age of 60 and yet there are no incentives for internal medicine students to choose to be geriatricians. We have about 250 geriatricians in Canada presently and we need many more. As well, the number of dementia patients is expected to double by 2031 to 1.4 million putting great pressure on families and facilities and yet we have no plan. Bill C-356, a bill to address some of the realities of dementia care, was proposed in 2011 and reached second reading in December of 2014. We’ll see how that goes.

Canada signed a UN document committing us “to help ensure that people everywhere can age with security and dignity, and continue to participate in the societies as citizens with full rights.” In order to do this, we need to keep a close eye on seniors and poverty and quality of health care.

There is much to be done yet. Any suggestions?


  1. Joyce Ashley

    I think that if health insurance rates were somehow attached to how healthy people are, then people would be more responsible for their health. I know many folks who just continue to smoke and drink and eat to excess and they’re taken care of – which is good – but I, who do eat and drink for my health and exercise responsibly, would like to see a break in the costs of paying for my health insurance. I am a senior on a limited income and yet I pay quite high rates no matter what. I’m grateful for the insurance but other types of insurance have different rates for different factors for instance, younger kids pay higher rates for car insurance. You pay a higher deductible if you have a lot of claims on your house insurance etc. Makes sense to me….but no one’s asking and there is no dialogue about this. Thanks for bringing this up….maybe it could be brought to the attention of the Federal government because the Baby Boomer cohort is huge….we can pack a lot of clout if voices are heard.

    • Stephen Boston

      From experience I can tell you that responsible living does not guarantee you a long and healthy life. Just as irresponsible living does not doom you to an early miserable death.
      I know a 94-year old man who drinks like a fish and smokes a pack of contrabrand cigarettes a day.
      I know – or used to know – a 38-year old woman, enthusiastic runner, vegetarian nut who died of lung cancer despite a year or so of the very best of care.
      So quit with your smug moralizing, accept your mortality, and see if you can find in your proud heart some compassion.

      • David Hughes

        Stephen Boston, saying “I know a guy…” is not the basis for a health care plan. It’s anecdotal. Health care plans are best based on evidence based studies, not stories about neighbours. In aggregate, eating well and not smoking tend to decrease the likelihood of disease in a population. This is about statistics, not about any given story you might happen to recall. Go ahead and eat pop tarts all day and smoke a pack or two if it pleases you. You might hit 100. But if we all did it, we’d see a lot more diabetics and lung cancer patients. Please understand the difference between your “experience” and the larger world out there.

        • Stephen Boston

          Some people like to say that it is authoritarian, even communist, to make decisions to the individual level based on community-derived standards.

          This is exactly what policies based on aggregate statistics are doing.

          But your argument here is directed against an argument I wasn’t making. My argument is against the notion that people who get sick are to blame for their sickness, that there is no call to compassion — or to community responsibility.

          As long as insurance is driven more by the desire to profit than it is to efficiently share the risk we all share then policies will use aggregate statistics to disenfranchise the unfortunate.

  2. Sheila kimmel

    “Canada signed a UN document committing us “to help ensure that people everywhere can age with security and dignity….”

    This will probably go the way of “eliminating child poverty in Canada”.

    Time for a voting block.

  3. Donna McCaw

    Interesting point, Joyce. CARP does good work on our behalf and is one organized voice. We need more!

  4. rudolph

    This is an old story,but one that needs to be repeated. Legislation must be passed that assures not only accountability for federal and provincial politicians but financial responsibility. There really is no point in attempting to introduce various policies to serve seniors etc. when government employees are busy exercising their rights to self entitlement, or worse attempting to be reelected. The amount of money squandered by McGuinty and his gang of thieves is absolutely outrageous. I also understand from legal opinions, that he cannot be prosecuted thus far and probably never will be brought to trial. His transgressions amount to approximately 3 billion dollars plus. The only relevant conclusion that can be drawn at this juncture could be summed up in three words. W.T.F.

  5. Joelle Willis

    I got a third surprise. As a Canadian living in the US, my Social Security is reduced by more than 6% because I am receiving CPP. The only explanation I can get is that “it’s the law.”

    • Donna Wymer

      Hello Joelle, Do you receieve both CPP and SS? Is the CPP reduced also?

      I am an American living in Canada – Dual citizen. My husband of 30 years just left me…so I’m trying to figure out my future as I have not retirement and I’m 51.

      I have enough points in the SS system to get some SS. I am now beginning to work – but at a minor wage as I was a teacher in the US and have not been able to get a teaching job here… But with the this job I will get some years into the CPP system and should qualify for something.

      I’m trying to figure out if one cancels the other out? Or do you a portion of both to the cap of whichever is higher? Or does the country you live in depend on how much you get.

      Thanks for any help you can give me regarding have dual citizenship and payment of retirement plans.

      I really appreciate it!!

  6. Sheila

    I suggest a class action suit. I worked for Holland with climate change. The suit was won.

    It Link it to the Charter of Rights and Freedoms.

  7. Alan

    I’m skeptical of more government policies and regulations supposedly to look after the boomers in their old age. That usually means more bureaucracy and costs. The poor have OAS and the GIS as well as free health care like the rest of us. The rich can look after themselves. That leaves the great lump of the middle class. First, everyone should take some responsibility for their own health and the money needed to pay for it. Second, the family needs to take some responsibility to look after their own family members. Third, we are living longer and healthier lives and are better able to look after ourselves than any other generation. The last thing we should be doing is whining for more government handouts.

  8. Charles

    Off topic a bit..But have you seen the amount of people young and Older standing outside of Public places, Malls etc. Smoking their health away.?..Smokers should be made pay for their health care in Canada..Why should we Non Smokers pay extra on everything so as SMOKERS can have “Free’ health care..Also (I may be getting a little bit carried away here) .BUT I think that people that allow themselves to BLOW UP to 2 or 3 hundred pounds overweight ..They also should be penalized regarding our Canadian Health Care System.

    • Dawn

      FYI. The cost of a carton of 200 cigarettes includes $21 in federal tax and $50 in provincial tax. I understand that these taxes have been added to the price of cigarettes in anticipation of increased health care issues. I believe that people who “blow up” in weight do not do so intentionally. I have met many hypochondriacs who are neither smokers nor overweight who “abuse” the health care system. Guess it all comes out in the wash.

  9. Nelson

    Yes and maybe those who play sports that may cause injury or those people that work at jobs that entail heavy, lifting causing injury,and let’s not forget those that work outside getting sick with colds and flus, snow mobile and all terrain vehicle driver should pay more because of the risk. Maybe we should only have health care for those that live in a sterile environment and keeps a dietitian and a health trainer on staff.

    • josie

      Well said Nelson! Kudoos to you!

  10. Mia

    Charles; have you seen the number of obese people, and people lined up for MacDonalds and KFC. Obesity is just as much a health risk as smoking. You need to apply your suggestion to those people too. And how about people who precise risky sports; they’re an increased risk too. IAnd people who like to drink. And people who drive without enough caution. I could go on and on. Get the point?

  11. Joe Wasylyk

    Stephen Harper said it best commenting about retirement. He said that Canadians should be responsible for their OWN retirement plan. I guess this also meant that ALL politicians are also responsible for theirs.

    I think that the CARP organization is great in the fields of Health Care and Pension reform. However; based on their own results CARP seems to be clueless when it comes to seniors income security and productive longevity.

  12. Jeanette Lear

    I’m so tired of trying to make ends meet with what I get for CPP & Old Age. The govt. doesn’t seem to care that we as senior’s are living at poverty levels. As long as they collect our tax dollars so they can get a great wage & retirement package that is all they care about. What about senior’s being taxed twice. First through all the years we worked & then taxed again on our pensions. We should not be taxed period on anything which would be a big help financially. Also all services should have a senior rate not just a few. Example vet fees, vehicle repairs etc. should all be discounted for senior’s. It’s fine to help out refugees, the Indians etc. but how about helping out your own people in your own country maintain a decent standard of living. But the govt doesn’t care as long as their pockets are lined well the world is a wonderful place.

  13. Jules

    Well I have been forcibly and early retired for a few years now. Been super responsible, always had a maxed out rrsp and tfsa, only had a mortgage for a couple of years, plus I also had 2 years of after tax salary in the bank.
    Sounds good right? Wrong. It is practically impossible for the average Joe to put away the HUGE amounts of money every expert out there says you need to after taxes of every sort and the most basic of expenses are covered.
    So, I am maybe not poor but most definitely badly off. Unless I sell the house and live in a tent. Then I would be middle class… in a tent. Makes no sense.
    Horrible to hear the likes of harper throwing everyone under the bus while he lives high off the hog on taxpayer money for life.
    Few in Canada can expect a decent retirement, except for public servants and the previously highly paid.

  14. Jane

    I don’t even care any more. I am 55 and working with no retirement in sight. It is exhausting as I have been working full time, or in school and working full time since I was 18 years old. Paid for everything myself as parents had zero interest in contributing to their children’s education etc. I own a home but big mortgage means I will have to sell and I will be homeless in old age. My parents were well off and had a good life rich with travel and aimed to live a long life. Father now in extreme old age and fighting to live a messed up low quality life at great expense. I will die young “in a tent” after caring for this hypochondriac abusive narcissistic man. After 2 massive economic collapses where I lost a large amount of my investments, I guess I’ll be better off dead. Welcome to Generation X in Canada. Now I’m just saving up for a grave plot so that at least my death will have some dignity. Canada is so overtaxed and cost of living is not in line with how much people make. They wonder why debt levels are so high. It’s a no brainer. it’s the massive taxes that force people to live paycheque to paycheque.

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