Your ‘golden’ years

The sandwich generation is finding it tougher than ever to plan for retirement. The nest egg saved by future retirees is not going to take them very far now that they are looking after aging parents and adult children returning home. A January 2012 Canadian Imperial Bank of Commerce analysis on consumer debt found Canadians over the age of 45 who are already in debt are borrowing even more money.

It’s a double-edged sword; both savings and paying down debt are critically important to one’s financial well-being. One way for Canadians to be successful at developing the discipline to save is to work with a trained credit counsellor. A credit counsellor will help the individual establish a budget, and include savings and paying down debt as an expense, much like a mortgage or rent payment. It’s the best way to measure financial success.

When the debt is paid, the money can be allocated to savings for a Tax Free Savings Account or Registered Retirement Savings Plan contribution, though it’s important you are not incurring additional debt just to get the tax refund.

Those who are finding it difficult to determine how much they can afford to save can start with a nominal sum, perhaps $10 per week, and have the money automatically transferred into a savings account. As you continue to adjust your spending habits, increase the amount you save and watch your money grow.

Tips to help save for retirement:

  1. Be mindful of your savings, and make saving a habit. Visualize your goal to stay motivated.
  2. Make saving invisible. Use pre-authorized transfers from your paycheque and/or round up debit purchases into your savings account. Don’t forget to add any bonuses or tax refunds to savings as well.
  3. Treat savings as an expense. Add savings to your budget.
  4. Make your savings grow. Take advantage of all the government incentives to save – RRSP, TFSA.
  5. Take control of your spending today!
    • Evaluate your needs vs. wants
    • Stop charging and use cash!
    • Track your spending
    • Once you’ve tracked your expenses, set a goal for how much you think is reasonable to cut back and put towards paying your debt
    • Research the ‘savings’ sites –,; become flyer-friendly and a coupon clipper
    • Create a spreadsheet or use a budget app

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