Are Canadians saving enough for retirement?

So, you’ve been dreaming about retirement for years—picture it: palm trees, beachfront villas, sipping margaritas by the pool, maybe even taking up that passion project you’ve always talked about. But, as it turns out, retirement isn’t just a vacation; it’s a serious financial journey. Here’s what you might not have considered and why it could impact your golden years.

Life expectancy: Are you in denial?

Canadians are living longer, and not just because of kale smoothies and yoga classes. The average life expectancy is now around 81 years for men and 85 years for women. That’s a whole lot more Netflix to catch up on! But here’s the kicker: nearly half of Canadians aged 55+ worry they’ll outlive their savings, and 40% expect to still be in debt after 65. This isn’t just a retirement—it’s a marathon.

The rising cost of long-term care

The Baby Boomer generation is aging, and so are the costs. One in ten Canadians will need long-term care by age 60, three in ten by age 70, and nearly half by age 80. Those numbers aren’t just stats—they’re future mortgage payments! Long-term care costs have been inflating at an average rate of 3% per year since 2010. Get ready for some sticker shock.

Young adults living at home

Ever notice how a good chunk of adults aged 20-29 are still crashing at Mom and Dad’s place? Whether it’s cultural, economic, or because rent is ridiculous, this trend could stretch your retirement plans. Parents might find themselves funding their adult kids longer—like, well into their own retirement years. “Sorry, Dad, can you spot me a few more years?”

Why a reverse mortgage might be the solution

Understanding these factors is key to figuring out how much you need to save for a comfortable retirement. For seniors aged 55 and older who own a home, a reverse mortgage could be the answer. This flexible financial tool lets you unlock up to 59% of your home’s value while keeping ownership. No need to move or sell the place. Plus, you don’t have to make monthly payments. You can get cash as monthly installments, a lump sum, or a mix of both. The loan only needs to be repaid when you pass away, move out, or sell the house.

Benefits of a reverse mortgage

Access to Tax-Free Cash: Use the funds to pay off debts, invest in your lifestyle, or support a new business venture. It’s a tax-free way to unlock your home’s equity without dipping into your savings or cutting into retirement accounts.

No Required Monthly Payments: Unlike traditional loans, a reverse mortgage doesn’t require monthly payments. This can free up extra cash flow to fund activities or investments that enhance your retirement—whether it’s travel, home renovations, or a new business idea.

Stay in Your Home: You keep ownership of your home and can stay in it as long as you like. No need to downsize or move to a smaller place just to manage your finances. It’s your home, your rules.

Flexible Use of Funds: Whether it’s helping your children with their first home purchase, funding home renovations, or supporting travel dreams, a reverse mortgage offers a flexible solution that lets you enjoy retirement on your terms.

Consider all your options

Retirement is a big deal, so don’t just wing it. A reverse mortgage can provide extra financial security and flexibility. Curious about what you can tap into from your most valuable asset—your home? Don’t hesitate to give us a shout—let’s chat about your options!

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Are Canadians saving enough for retirement?

Are Canadians saving enough for retirement?