Overview: Major Issues Concerning Retirement

A major issue concerning retirement is financial insecurity, specifically the fear of outliving savings (longevity risk).  Recent data shows that nearly 60% of Canadians fear running out of money during their retirement.

Beyond the financial worry, other critical issues impact retires are:

  1. Financial Challenges
  • Inflation & cost of living: Rising prices for groceries, housing, and utilities erode purchasing power, making it difficult for those on fixed incomes to maintain their standard of living.
  • Healthcare costs: Unpredictable expenses for prescriptions, dental care, and long-term care can quickly deplete a “nest egg” as many of these are not fully covered by provincial health plans.
  • Withdrawal strategy errors. Retirees often struggle to determine a “safe” withdrawal rate, risking either spending too much too early or living too frugally and missing out on their retirement goals. Check out my April issue of Build a Great Retirement newsletter in which I explore ‘the best way to transition from savings to spending’.
  • Market volatility: Negative market returns just before or after retirement can significantly reduce the total value of assets when they are most needed.

2. Psychological & Social Hurdles

  • Loss of identity and purpose: For many, work provides a primary sense of identity.  Transitioning away from it can lead to a “vacuum” causing feeling of uselessness or loss of self-worth. 
  • Social isolation: Retiring often means losing daily interaction with colleagues, which can lead to loneliness and depression if new social networks aren’t established. Review my article: The Loneliness Risk. March 4/26: https://whencaniretire.ca/insights/
  • Relationship Stress: Spending significantly more time with a spouse or partner at home can require a difficult adjustment and lead to new relationship tensions.

3. Structural & Planning Issues

  • Lack of formal planning: More than half of Canadians do not have a written retirement plan, which significantly increases anxiety and makes it harder to know if they are “on track”.  If you don’t have a comprehensive plan, consider working with a retirement coach.
  • Delayed investing: Starting to save too late is cited as one of the single biggest threats to retirement security because it limits the power of compound growth.
  • Declining access to pensions. Fewer workers now have access to traditional workplace pension plans, forcing more individuals to rely solely on personal savings and government plans like CPP and OAS.

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For financial advice, consult a professional financial advisor or wealth manager. For help building a realistic vision of retirement and plans to make to happen, consult a retirement coach. 

Rick Atkinson, (Mister Retirement), Retirement coach.  B. Com, MBA, CHRP, CMC, FDFS