happy-retired-couple

Retired Canadians spend, on average, $2,400 per month ($28,800 per year). Housing accounts for the single largest monthly expense (an average of $668), finds a BMO Financial Group study.

Other expenses include, on average:

  • $581 for living expenses such as bills, clothing and transportation
  • $442 for food, including groceries and eating out

Read: 5 key risks to retirement income

  • $282 for travel
  • $167 for entertainment
  • $151 for medical expenses

According to the study, 55% of Canadians have spent large amounts (roughly $10,000 or more) on single items in retirement. Expenditures include:

  • Purchasing a new vehicle (41%)
  • Major home renovation (22%)
  • Giving a large sum to family members (11%)

The study also asked retirees what surprised them most when they made the transition to this life stage. Top responses were:

  • Not having enough time in the day to do everything they would like (37%)
  • Savings are not as sufficient as they thought (25%)
  • Spending less money than they thought they would (25%)
  • Traveling less than they thought would (23%)

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Some early retirees would be broke within a year

  • Spending more money than they thought (21%)
  • Seeing friends and family more than they thought (21%)
  • Experiencing an onset of declining health sooner than expected (21%)

Two thirds of retired Canadians spend their time with friends and family. Sixty percent pursue hobbies, 49% travel and 29% volunteer or do board work.

Regional breakdown:

Region Average amount spent on expenses per month/year Top monthly expense % who made a large purchase ($10,000 or more) after retirement % most popular large purchase is a new vehicle % surprised that they do not have enough time in retirement
National $2,400/ $28,800 Housing 55 41 37
Atlantic $1,975/ $23,700 Bills, clothing, transportation 56 43 39
Quebec $2,214/ $26,568 Housing 59 47 44
Ontario $2,534/ $30,408 Housing 48 30 36
Alberta $2,648/ $31,776 Bills, clothing, transportation 66 50 30
B.C. $2,073/ $24,876 Housing 56 50 36

Originally published on Advisor.ca

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