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Nova Scotia Seniors – The Financials of Living LongerPosted Oct 17, 2016
The good news is, we are definitely living longer. How many “Milestones” are announced in the news where some Nova Scotian has just celebrated their 100th birthday. There are quite a few now, announced almost every day. Last week, it was someone who had just turned 107… wow… 107!!
Experts tell us that in 2011, there were 5,000 centenarians in Canada and in about 46 years, that number is expected to top 78,000.
This gives a whole new meaning to financial planning for the future. We now have to plan for much further ahead and we need to take into consideration health issues that we are likely to face and, therefore, the cost of making modifications to our home to make it more geared for seniors and, for some, a long-term care facility.
Many of us have always felt secure in the fact that when the time comes, costs of long-term care will be fully paid by our government health program. That is not the case. The fact is that they may only cover a small percentage or none at all, depending on circumstances. This leaves the individual or their family responsible for the bulk of those and any related costs – related costs being medications, sitters, etc.
The following is a calculator based on current long-term care basics and it does not include the above mentioned “related costs”. The amounts vary by province, Nova Scotia, being one of the more expensive provinces.
You need to plan for a retirement that could extend to your hundredth birthday … and perhaps beyond(80 is now out). That means more funding and for a longer time. Use an example of a woman who retires at age 65, puts her retirement savings into investments held within a Registered Retirement Saving Plan (RRSP) that earns 6 per cent. She draws $3,000 through a Registered Retirement Income Fund each month. Ignoring taxes, she would need to have saved $375,425 to last until age 80. However, if she needed income to age 100, she would need $543,160 ($167,735 more) at retirement age (65).
Next… 65 is no longer considered as the normal retirement age. Early, phased-in and progressive retirements are rapidly gaining popularity. The retirement concept you choose will affect your retirement needs, pension plan entitlements, RRSP wind-down dates and many other aspects of your financial plans.
You need to speak to a professional advisor. There are many out there and many companies – pick one you feel good about, plan carefully for your retirement and any health insurance issues you need to consider.