What are your retirement expectations?

Canadian baby boomers have some unrealistic retirement expectations.

Some of you intend to retire early (before age 60), but you’re not saving nearly enough to achieve that goal. Those aren’t the people at which this article is aimed. I may lecture you folks in another article.

Related article: How much should you save for retirement?

When I last checked the average retirement age was 62.5. It was dropping for years, a trend that has reversed slightly, and has now stabilized.

Some of you are planning to work a very long time – either because of inadequate retirement preparations or because you want to keep working well into your 70s – or beyond. It’s fine if you want to work longer because you like your work, for social interaction or for some non-financial reason.

However, it’s risky to plan to work longer because you know you won’t be able to afford to retire. What if you change your mind? Maybe poor health forces the issue. The boomers are healthier than any previous generation but don’t use that as an excuse not to prepare properly for retirement.

In her book Pound Foolish, Helaine Olen calls the idea of baby boomers working well into their 70s, or beyond, “retirement porn.” Her view – and mine – is contrary to some in the media who are touting greatly extended working careers.

Related article: Does retirement pornography work?

The Wall Street Journal recently published an article called A Retirement Age of 100? It’s Coming. I think the notion of planning to work to age 100 is dangerous. The wild card is our health.

Even if your health remains good, will you still feel like trudging off to work in your 80s or 90s? I hope to be trudging to the kitchen table to read my newspaper when I’m 80. I may work into my 70s (I hope my wife doesn’t read this).

Economist Theresa Ghilarducci of the New School points out the absurdity of the notion of planning to greatly extend our careers. “Working longer is a retirement plan like winning the lottery or dying earlier is a retirement plan,” she writes. “Being able to work longer is not a plan. It’s a hope.”

Related article: Who says you need to stop working at 65?

As a financial planner and a baby boomer, I know the sorry state of retirement expectations and retirement preparedness for many of my generation. I read lots on this topic and boomers have high retirement expectations but are on track to fall far short of their goals.

We’ve earned good incomes and we’re used to spending lavishly. We wanted something, we bought it. We’ve lived in lovely houses, driven nice cars, taken great vacations and spoiled our children.

Now that the kids have flown the coup (sometimes two or three times), we’re in a position to be able to dramatically step up our retirement savings. However, many have instead stepped up the spending. They’re moving to nicer houses, buying cottages and RVs, taking lavish trips, putting 2.5 kids through university and helping those kids buy houses. When grandkids come along, we spoil them, too.

All of this while some have chosen to swear off investing, fleeing to the security of low-interest GICs for a negative real rate of return (after taxes and inflation).

Olen finishes with a truism of which people should take note. “Baby boomers,” she says, “are going to retire. It’s time we admitted it.”


  1. fritz

    I retired at the age of 42.
    still means i can do the odd job and make a hundred bucks every other month doing something i like.
    careful planning is needed to do this though.

  2. Tikiri

    Great article.

    I am Gen X myself so am really curious how you did Fritz. Would you be willing to share some lessons learned?


  3. Denise

    Anyone contemplating retirement needs to read, “How to Retire Happy, Wild, and Free: retirement wisdom that you won’t get from your financial advisor” and “The Joy of Not Working: a book for the retired, unemployed, and overworked” [21st Century ed.] both written by Canadian author, Ernie J. Zelinski.

    It will be some of the best retirement advise you’ll ever read!

  4. George Sillanpaa

    Years ago when I started work, there was no RRSP and I dabbled in stocks. Unfortunately you need money and time to analyse stocks. Just ask Warren Buffet. So this was not a realistic option. I bought a house, and upgraded three times, till now, and I have a $ 1.5 million home with a $250k line of credit. No mortgage. I also have a $ 400k RRSP which is making 5% overall a year. Not enough cash to max out my TFSA, and my employer retired me at 61, so I took govt pension, and converted some RRSP to Life Income. Wife is also retired and pensioned.Your advice is good, but if only interest rates were higher, I would not be in trouble. If the stock market did not drop in 2008-9, I would not be in trouble. If the dollar, the econony, oil prices and gold prices did not drop, etc. I think overall I have done better than most, and will sell the house and downsize soon, as the last remaing kid leaves. Hindsight says I could have done better, but the old ways are dead, and the bankers have all the cards. Realistic advice, that fits with life and living, and raising kids, really hard to do, with so many over-riding external factors over which you have no control.

Leave a reply

Your email address will not be published. Required fields are marked*