Weekend Reading: Raising Retirement Age Edition

Maybe raising the age of eligibility for Old Age Security from 65 to 67 wasn’t such a bad idea after all? The Liberal federal government reversed a controversial decision made in 2012 by the Conservative-led feds and returned OAS eligibility to 65. But now an economic advisory council is recommending Ottawa raise the age of retirement eligibility to help stimulate Canada’s workforce participation.

Even a tiny increase in the number of baby boomers in the workforce would have a big and positive impact on the economy.

“Today, just 54 percent of Canadians aged 55 to 69 are in the work force. According the council, if that figure were to rise slightly, to just 62 percent, the same level as a basket of peer countries including Sweden, New Zealand and the United States, Canadian GDP would get a one-time boost of 2.8 percent. No other single move identified by the council would deliver such big benefits.”

So the question is: How open are you to the idea of working past age 65?

Here’s a neat story in The Globe & Mail’s retirement reflections series on finding joy beyond conventional retirement.

Delayed Retirement

This Week’s Recap:

On Monday I wrote about how contributing to your RRSP is a two-step process: First you make a contribution, then you need to purchase an investment.

On Wednesday Marie started a new series called becoming a better investor and looked at managing asset allocation in multiple accounts.

And on Friday Marie explained the three phases or stages of retirement.

Weekend Reading:

An interesting look at college endowments and how tiny Houghton College achieved higher returns than the vaunted Harvard endowment by switching to a mostly low-cost passive indexing approach. Hmmmm.

An economist sees the sharp slowdown in Vancouver’s housing market as a warning that Canada’s housing bubble has finally burst.

Cullen Roche is exploring some of the biggest myths in investing and this article looks at the myth that indexing means average returns.

Young & Thrifty with the ultimate 5-step guide to maximizing your index ETF returns.

A fantastic Couch Potato podcast this week featuring the Millionaire Teacher Andrew Hallam.

The new HBO documentary “Becoming Warren Buffett” offers a glimpse into the man, rather than the investor:

Buffett, by his own description, was socially awkward as a kid (he attributes much of his later success to taking a Dale Carnegie public-speaking course as a young man), and the film is a portrait of a person for whom financial questions “are easy,” as Buffett says. “It’s the human problems that are the tough ones.”

Financial Uproar reveals Warren Buffett’s biggest investing secret. (Saved you a click: It’s Berkshire’s massive insurance float.)

Jonathan Chevreau explains how to pay less income tax by taking advantage of pension income splitting.

The rules around the Canada Pension Plan survivor benefit are worth investigating before you find yourself widowed. The Globe & Mail on when you don’t get the CPP survivor benefit you expect.

Alexandra Macqueen with important questions to consider when exiting a defined-benefit pension plan: Can you and should you?

Shameful: A former Edmonton mutual fund salesman unlikely to pay back any of clients’ $812,000 losses.

Garry Marr explains that RRSPs are one place the creditors will never be able to grab your money.

Million Dollar Journey looks at two stock picking strategies, the Dogs of the TSX and Beating the TSX.

Another podcast, this time with Jessica Moorhouse and Desirae Odjick chatting about how to save half of your income like a pro.

Michael James on sharing restaurant and vacation costs with friends.

Discount airline upstarts NewLeaf and Flair Air are having all kinds of issues fulfilling flights prompting the Consumers’ Association of Canada to issue a warning over what it calls arbitrary cancellations and alterations to flight dates and times:

“Buyers of NewLeaf tickets should be asking themselves the question, ‘Does the saving of buying cheap tickets warrant the risk of being stranded?” reads the alert.

Younger employees keep getting stereotyped as insecure and needy. Perhaps the rest of us need to reconsider why we find it normal for bosses to be jerks.

Finally, an interesting read on why UPS drivers don’t turn left, and how it saves them 10 million gallons of gas a year.

Have a great weekend, everyone!

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  1. FritoPaws on February 12, 2017 at 11:09 am

    Perhaps one solution to increasing the 55-69 workforce would be to increase the eligible (reduced) retirement age for government employees from 55 to 60. Why penalize the large majority of Canadians when a few have the opportunity to beat the crowd by 10 years and a small bump up in this age group will ease the stress?

    That Young & Thrifty tax graphic is fantastic! Thanks!

  2. Peter McN on February 14, 2017 at 6:19 am

    I’m not sure what the statistics are but perhaps a factor worth discussing when it comes to retirement age is companies making older workers redundant. As companies struggle to compete in turbulent economic times cost reduction is often a major consideration and “right sizing” a part of that. Older workers end up being targeted and put to pasture because they typically cost a company the most in terms of total compensation. Having been made redundant myself shy of full retirement age I decided rather than trying to secure new employment I would retire. In the absence of redundancy I would still be working today and had planned to do so past age 65. Hearing the discussion about people leaving the workforce early and the resultant impact leading to thinking concerning moving the retirement age to 67 grinds my teeth. What would they have older workers do a flip flop with the young and take their place behind the fast food counters of the land ?

  3. Angelo Bin on February 15, 2017 at 8:17 am

    I sympathize with Peter.
    Ask anyone in their 50’s about trying to get employment. It is almost useless to look for a good position in any field.
    And now, it is up to the boomers to help the whole economy by working longer. I wish it were true.
    Have you ever sat in a job interview with a person more than half your age? If it weren’t so humiliating, it would be humourous.
    If you expect companies to now be dying to hire older workers, or to keep their older workers, dream on.

  4. John on February 16, 2017 at 4:17 pm

    I’m totally against raising the retirement age, maybe if some of the tax deductions or loopholes for the uber-rich and big business it would have the same impact on GDP!

  5. Monique Ruck on February 17, 2017 at 10:43 am

    I agree with Angelo….let’s look at the reality of the workplace today for workers in their 50s and 60s (if one is blessed enough to still have a job in their 60s). Most of my friends/family members/people who comment on career related sites such as LinkedIn have stories of being pushed out, demoted or ‘given the package’ to make room for the younger worker (who is willing to get paid less for the same work the older worker was doing perhaps?!)…unless you are lucky enough to own a business, have entrepreneurial spirit to start one, or be a municipal/provincial retired worker who can get ‘consulting contracts’ while collecting CPP..there is not much out there except minimum wage jobs. Having said that, perhaps they want the older worker (those blessed to still have a job) to work longer so they can pay for their kids mortgages, credit card debt etc etc seeing that many of these young folk don’t seem to have a clue how to save, and spend responsibly!

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