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susan_eng_2010_bio“People have not planned for that and there is a certain amount of sticker shock and that kind of expense you can’t put on your credit card. When we are talking about those kinds of expenses on top of a reduced income, we can see that in retirement, if you are not working, the challenges of making ends meet are much greater than anticipated.” – Susan Eng


 

Today’s seniors, Susan Eng recently told a summit of pension experts, are not your grandmother’s seniors.
The differences are obvious: baby boomers are living longer and healthier than previous generations, and they bring with them an unwillingness to settle into the comforts of old age – to not go gently into the night. Rather, they seek a vibrancy in their later years that longed defined them when they were younger.
That search takes many forms. Some retirees find direction in volunteerism and helping their community – in encore acts. Others find time for cherished hobbies and past-times. Many continue to work beyond the traditional retirement years, some because they want to and others because they need to.
It all adds up to a very different picture of later years for what has been called the ‘young-old’ generation.

“We are different from our parents in terms of what we do at this age. Yes, if we have good pensions we might fly off to our vacation homes, but mostly a lot of people in their 60s are thinking about staying in the workforce,” said Eng, a leading spokesperson for seniors’ rights and formerly vice president for advocacy at CARP.

“The thinking that people who are 65 are going to be, by definition, non-productive … I think is going to be false. That’s key, because if we assume the facts as they are now will play out in the future, we might have a different trend. The number of people who are 65 or more who are staying in the workforce or who are reentering it is going to keep growing.”
Eng spoke at the recent Pension Summit 2016, organized by the Conference Board of Canada, where pension experts talked about sustainable retirement solutions for Canadians. If older Canadians are remaining in the workforce, and the numbers show that they are, then societal expectations need to adapt to the new reality, and political action is required to reflect these new trends, Eng told her audience.
So, what does the data say about the changing face of older Canada? It says that among people 65 and older, 10 per cent remain in the workforce, a doubling of where it was just ten years ago. And with the group just younger, 60 to 64, as many as 50 per cent are still working, said Eng.
“That was different from the generation before … and as that group of baby boomers moves through the workforce, you see that more and more people want to keep working.”
A lack of adequate retirement income means that many Canadians reaching the traditional retirement years don’t see working as an option, but rather a need to keep the income coming in to pay the bills. But even among the ‘young-old’ group with solid pensions, many want to continue to work – if only in a part-time capacity.
And because of changing attitudes about age, older people wanting to continue working don’t feel the societal pressure to hang it up. Efforts by advocates like Eng, through her work at CARP, helped to remove obstacles such as a legislated retirement age.
It has been noted that keeping people in the workforce longer has a number of benefits, including providing more time to accumulate retirement wealth, keeping required skills in the labour force, and maintaining the economic benefits of work such as the paying of taxes.
However, if the trend of Canadians staying in the workforce longer is to develop as a positive direction, “we have to deal with the issues of ageism and workplace discrimination,” said Eng.
A range of incentives could address these concerns, such as a discounted tax rate for older employees – a type of bonus for employing older Canadians. “The thing about age is that nobody wants to tell you how old they are until there is money in it.”
An even more effective approach to enabling the working trend is to let older workers stay on the company health plan, even if they are working part-time hours or ‘age-out’ of coverage, said Eng.
“People who need that coverage need two things: you need to give employers incentives to keep people on after a certain age, and second to provide that coverage to people who are not working full-time hours.
“Why? Because, sometimes older workers have other responsibilities. Sometimes their health keeps them away, or they may also have care-giving responsibilities. If there is a need or want to keep people working past 65 … social and political infrastructure has to be there in order to make that a reality.”
Other factors that keep people working, all wrapped into the overall envelop of inadequate retirement income, include the cost of care following an illness or injury, said Eng, pointing out that Canada does a good job at treating acute-care situations, but the real cost comes after leaving the hospital.
“People have not planned for that and there is a certain amount of sticker shock and that kind of expense you can’t put on your credit card. When we are talking about those kinds of expenses on top of a reduced income, we can see that in retirement, if you are not working, the challenges of making ends meet are much greater than anticipated.”
Pensions, she continued, “are important to our individual financial wellbeing, our peace of mind and, of course, the stability of our society and economy,” adding the general public doesn’t understand the difference between defined benefit and defined contribution, and as long as they don’t are a risk of being “sold a bill of goods.
“I think the people who know better know that DB is much more efficient and much more capable of doing the job … of providing adequate retirement income.”

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