Last month, I found a jar of mustard at the back of my fridge with a best-before date of 2019.
asserted
I → find → 2019
It looked and smelled fine.
asserted
It → look → ?
My wife watched me unscrew the lid like I was about to eat gas-station sushi, and I threw the mustard away.
asserted
I → watch → mustard
I wish Canadians gave their retirement plans the same hard look, because most of the advice we hand people over 55 carries a best-before date of 1990, the year my parents’ retirement began.
asserted
retirement → wish → 1990
They met at the grocery chain where they both worked, and each left with a defined-benefit pension: a monthly cheque that arrived for the rest of their lives, regardless of what the stock market did.
asserted
market → meet → what
Their employer bore the investment risk.
asserted
employer → bear → risk
Their job was to show up at the retirement party and eat the cake.
asserted
job → show → cake
That plan stood on three legs: a workplace pension, Canada Pension Plan (CPP) and Old Age Security (OAS), and a paid-off house you would eventually sell to trade down.
asserted
you → stand → legs
In 1991, a 65-year-old Canadian man could expect to live about 16 more years and a woman about 20.
uncertain
man → expect → 1991
A plan built for that stretch did its job.
asserted
plan → build → job
Only 37.7 per cent of paid workers in Canada belonged to a workplace pension plan of any kind in 2023, according to Statistics Canada, and coverage has been declining for two decades.
uncertain
coverage → pay → decades
For most people, the cheque that used to arrive like the newspaper has been replaced by a statement that reads like a horoscope.
asserted
that → use → horoscope
CPP and OAS were never meant to carry anyone alone.
asserted
CPP → mean → anyone
That leaves the house.
asserted
That → leave → house
A 2023 CPP Investments survey found that only 45 per cent of Canadians have a financial plan for retirement, yet about three in four Canadians aged 55 to 74 own their homes.
asserted
Canadians → find → homes
For millions of families, the house was the plan: buy it, pay it off, and burn the mortgage papers in a roasting pan.
asserted
house → buy → pan
The old playbook still has one instruction for that asset, unchanged since 1990: sell, move, and hope the condo is cheaper.
asserted
condo → have → 1990
Most people would like to stay in their neighbourhood.
asserted
people → like → neighbourhood
In Toronto, they usually can’t afford to.
asserted
they → afford → Toronto
The calendar changed, too.
asserted
calendar → change → ?
My parents’ plan was built for that 15-to-20-year stretch.
asserted
plan → build → stretch
Today, Canadian financial planning standards give a 65-year-old couple an even chance of one living to 94, a retirement closer to 30 years.
asserted
standards → give → years
That is about 10 extra years of groceries, property tax and dental work, and nobody gave the plan a raise to cover them.
asserted
nobody → give → them
Larry Fink, who runs BlackRock, put his finger on it in his 2024 letter to investors: we have worked hard to help people live longer and much less hard to help them afford those extra years.
asserted
them → run → years
Those years arrived just as the guaranteed pension cheque was disappearing, a change Fink called “a shift from financial certainty to financial uncertainty.”
asserted
Fink → arrive → uncertainty
When the man in charge of the world’s largest pile of other people’s money says so, I’d put down the mustard.
asserted
I → say → mustard
Our system does a fine job of helping people pile up money, then goes quiet the moment they need that pile to become a paycheque.
asserted
pile → do → money
We hand people a savings target, a risk questionnaire and an RRSP deadline.
asserted
We → hand → target
On their last day of work, we hand them a bouquet.
asserted
we → hand → bouquet
How much do you withdraw?
asserted
you → withdraw → much
What happens to your OAS when your RRIF minimum pushes you past the clawback threshold?
asserted
minimum → happen → threshold
Where does the house fit?
asserted
house → fit → ?
The old plan shrugs.
asserted
plan → shrug → ?
The strain shows.
asserted
strain → show → ?
Statistics Canada reports that among Canadians aged 65 to 74 who worked in 2022, almost half did so out of necessity.
asserted
half → report → necessity
After a late-life divorce, my mother returned to part-time work at a grocery store.
asserted
mother → return → store
She had done everything the old plan asked of her.
asserted
plan → do → her
The usual reply is that people just need to save more.
asserted
people → need → more
Telling a 72-year-old to save more is like telling a marathoner at kilometre 40 to train harder.
asserted
Telling → tell → kilometre
An up-to-date plan opens with the question that matters at 65: how will this money cover the bills for 30 years?
asserted
money → open → years
…and 9 more, not listed.
The Aporia
