Retirement age must rise: Study

By Steven Lamb | June 18, 2007 | Last updated on June 18, 2007
2 min read
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    To encourage later retirement, the Montreal Economic Institute suggests the province raise the bonus it pays through the Quebec Pension Plan to those who retire after 65, from 0.5% per month to 0.7%.

    That’s the “carrot.” The think tank also recommends a policy “stick” of allowing private pension plans to penalize early retirement by introducing an actuarial reduction, beginning at age 55.

    Last week the Canadian Institute of Actuaries warned that most Canadians were unprepared for retirement, saving far too little to maintain their lifestyle after they stop working. According to the actuaries, to achieve 70% income replacement, the average 40-year-old earning an industrial wage would have to save 38% of his or her income.

    Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com

    (06/18/07)

    Steven Lamb

  • R elated Stories

  • Evaluating an early retirement package: A checklist
  • For majority, retirement is a pipe-dream: Study
  • Retirement planning big priority for 30-year-olds: Study
  • Plan for “slow motion crisis” of an aging Canada, pension industry told
  • To encourage later retirement, the Montreal Economic Institute suggests the province raise the bonus it pays through the Quebec Pension Plan to those who retire after 65, from 0.5% per month to 0.7%.

    That’s the “carrot.” The think tank also recommends a policy “stick” of allowing private pension plans to penalize early retirement by introducing an actuarial reduction, beginning at age 55.

    Last week the Canadian Institute of Actuaries warned that most Canadians were unprepared for retirement, saving far too little to maintain their lifestyle after they stop working. According to the actuaries, to achieve 70% income replacement, the average 40-year-old earning an industrial wage would have to save 38% of his or her income.

    Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com

    (06/18/07)