Canadian retirees are living on 62% of the income they had before retiring, according to a new report.
The Sun Life Financial Retirement Now Report also found that 88% of retired Canadians described life in retirement as positive, with 32% saying their biggest financial surprise is now they were able to manage on a reduced budget. Another 10% said they are spending less than expected.
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“This is the first time we’ve measured what percentage of pre-retirement income retirees are living on,” said Kevin Dougherty, president of Sun Life Financial Canada. “Life in retirement is more sustainable than you might think.
“Despite current economic conditions, Canadians are doing quite well living on just over 60% of the income the had when they were working. And this average doesn’t change much when comparing men with women or taking marital status into account.”
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On average, retirees are spending $2,611 a month on expenses that include food, housing, healthcare and taxes. This is 24% less than the $3,431 working Canadians spend each month on the same expenses.
When asked what advice they’d give working Canadians, respondents’ top three answers were:
- Start saving and investing early (88%);
- Make taking care of your health a priority (88%); and
- Live within your means (85%)
The research also found that today’s retirees have a good understanding of the value of financial advice. Some 62% of retirees who work with an advisor say they have saved enough for retirement, compared to just 38% of retirees who don’t work with an advisor.