Retirement plans not a topic of conversation

Retirement plans

Even though retirement is something Canadians look forward to, many of them are not discussing it with their spouses. Couples are avoiding certain topics as they near retirement age, according to the RBC Retirement Myths & Realities Poll.

The poll found that couples are avoiding the following three topics:

  • How either will manage if the other encounters health issues (86%)
  • How either will manage if the other passes away prematurely (81%)
  • What activities they will do in retirement (61%)

Jeff Schwartz, executive director of Consolidated Credit Counseling Services of Canada, says avoidance of difficult health-related topics can lead to serious problems –

“Neglecting to plan for a health-crisis in retirement is a dangerous road to go down,” says Schwartz. “I urge Canadians to talk with their loved ones about various problems that could arise as they age. Without a plan, a sudden change could have serious financial consequences.”

Aside from changes in health, couples seem to be avoiding the topic of how they will spend their time when they no longer have to go to work each day. Bill Hill, national retirement planning consultant at RBC, says people are focused on the present, not the future –

“Couples often have more conversations about what they’ll be doing over the summer or winter holidays than what they hope their retirement will be like,” says Hill. “Yet one of the most important discussions you can have as a couple in your 50s or older is around the future lifestyle you’re hoping for when you’re no longer working 9 to 5. You want to do everything you can now, to ensure your retirement years will be equally enjoyable for both of you.”

Consolidated Credit offers the following tips to Canadians nearing retirement age –

  • Avoid credit card debt Getting rid of your debt as you move to a fixed income will ease the transition into retirement. Large debt obligations can be a burden that could be tough to handle in the event of an expensive health crisis. Making a debt management strategy that will eliminate debt before retirement can be an effective way to help you enjoy your golden years.
  • Plan for the worst – Do not avoid the difficult topics of death and sickness. Create an emergency savings fund that will give you a buffer when a personal and financial crisis takes place. Utilize automatic withdrawals from your bank account to keep you on track. Having this fund of accessible cash handy when something unexpected happens will ensure you remain financially stable.
  • Budget – Making a budget will get you thinking about how you want to live in retirement and how you will be able to afford it. Whether it’s spending days at the golf course, visiting family and friends or travelling the globe, it’s a good idea to get it down on paper first.
  • Keep working – Going from a full-time job to nothing at all can be quite a shock. Considered doing this in stages by working part-time when you reach retirement age. The extra income that a part-time job can bring in can help you reach your financial goals and keep your mind and body active.

If you want to learn more about making responsible financial decisions, check out Consolidated Credit’s free Personal Finance educational section. If you’re struggling with debt, call one of our trained counsellors today at 1-888-294-3130 for a free debt analysis.

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