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The impact of increased life expectancy creates serious implications for retirement planning in Canada

By Edited Oct 1, 2016 0 0

The impact of increased life expectancy

Older workers are increasingly raising the retirement age from the mid-1990s, according to a recent report by Statistics Canada. This is due to the increase in life expectancy of Canadian and even the Canadian government plans to raise the retirement age in Canada from 65 to 67 years.

This will have serious implications for Canadians, because they have to be more financially prepared if they plan to retire comfortably and maintain their standard of living.

Your choice of when to retire impact on retirement planning in Canada, and must be considered before going on retirement. According to Statistics Canada in 2008 was occupied by 50-year-old can expect to work another 16 years, about 3.5 years longer than workers of the same age in the mid-1990s. But working longer does not necessarily mean a shorter life expectancy due to retirement. In 1977, people could expect to spend 11.2 years in retirement. In 2008, the expected length of retirement was 15 years old.

In 2010, the Canadian Institute for Health for Health Information reported that while Canadians over age 65 is less than 14% of Canada's population, they consume about 44% of all health care dollars spent on the provincial and territorial governments. In 2008, the last year, disaggregated by age groups, provincial and territorial governments spend an average of $ 10,742 in Canadian aged 65 and older, compared with $ 2097 for those aged between 1 and 64. In the older population, the cost varies widely by age, with health care costs for seniors age 80 and older, on average $ 18,160 per capita more than three times higher than for older persons under the age of 70 years ($ 5828 per person on average).

These statistics only consider expenditure on health in relation to medical services covered by government health care. These statistics do not include other expenses such as prescription drugs that are not covered by the Government, the cost of long-term care, the cost of home health care, and much more.

In addition to life insurance, your insurance coverage must include coverage of critical illness and long-term care coverage. This combined coverage ensures that when the time comes to retire, what your long-term care is covered, as well as critical illness. Critical illness insurance is a particularly great investment because it is cheap, when we are young. If you buy a basic policy of the disease and does not suffer a critical illness you can get 100% of their contributions back. If you happen to suffer a heart attack or diagnosis of cancer, Alzheimer's disease or other critical illness, many older eventually faced with the age, you will receive a lump-sum payments, which will go a long way when it comes to payment for treatment and care.

It's no secret that in recent years in the lives of those in which people experience increased health problems that require additional support. The cost of pension plans later in life becomes much more expensive, so it's important, how and when the RRSP plan that you think you only need insurance for retirement, long before retirement.



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