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Value of guaranteed lifetime income

Investments, Personal Finance

Posted by Peter Wouters

Apr 18, 2019 2:00:00 PM

Directeur, Planification fiscale et successorale et planification de la retraite, Gestion de patrimoine
Placements Empire Vie

Value of guaranteed lifetime income

The interest in guaranteed lifetime income and its importance to aging Canadians is growing rapidly. This value held by Canadians for guaranteed lifetime income is in addition to government sponsored plans.

Value of Guaranteed Lifetime Income in addition to government sponsored plans

2/3 of people aged 55-75 like the idea of guaranteed lifetime income
80%
up from 60%
percentage of Canadians who see it as highly valuable supplement to government benefits
(2018 vs. 2015)
45% of those with financial assets = $100K+ highly confident of ability to maintain standard of living in retirement
Source: 2018 Canadian Guaranteed Lifetime Income Study, Greenwald & Associates and CANNEX

 

1/3 of women are highly concerned about being able to maintain their standard of living in retirement.  1/3 of women are highly concerned about being able to maintain their standard of living in retirement.

 

There are gender differences in concerns. For instance 1/3 of women are highly concerned about being able to maintain their standard of living in retirement.

Almost 4/10 women fret about long term care expenses in old age. These figures are almost double those for men. (Source: 2018 Canadian Guaranteed Lifetime Income Study, Greenwald & Associates and CANNEX). Here are more insights on Age Gender and Retirement Perspectives.

This is understandable when you consider that women live longer than men and a higher proportion of elderly women live alone and in poverty.

Although people are living much longer, they are not necessarily working longer or able or willing to work longer. That leads to a longer time frame for people to be financially independent and feel comfortable that they can keep that up. They require more resources that will last longer to cover expenses. What do Canadians want in terms of pensions plan style retirement plan features?

What Canadians want

Average
ranking

Pension plan/Retirement plan features

8.4 Having a retirement income that is guaranteed to last my entire lifetime
8.2 Having a retirement income that is predictable
8.2 Retirement income that keeps pace with inflation
7.7 Having a pension or retirement savings plan that will provide income if Iam forced to retire earlier than planned
7.6 Having and income that does not fluctuate with investment results
Source: Designing retirement schemes Canadians want:...; April 13, 2017

 

Are aging Canadians getting what they want? What role do advisors play uncovering this for each client in terms of a discovery process, education and providing options geared to the client’s needs and expectations? Read Guaranteed lifetime income: the 90% factors for more thought provoking research findings.

 

Republished with permission by Peter Wouters. For the complete list of articles, please visit here.

Related articles:

Guaranteed Lifetime Income: the 90% factors

Age, gender and retirement perspectives


The information in this blog is for general information purposes only and is not intended to provide legal, tax, financial or professional advice. We assume no responsibility for any reliance made on or misuse or omissions of the information contained in this blog. Please seek professional advice before making any decision.

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