Retirees Need Only 60 Percent of Pre-Retirement Income

With about one-third of Canada's 33 million people born between 1946 and 1962, Canadians approaching retirement rresent the fastest growing demographic in the country.

Last year, Statistics Canada reported that the number of Canadians aged 55 to 64 -- those most likely to be thinking about retirement -- jumped by 28 per cent over the past five years to 3.7 million.

The good news is that 70 per cent of these so-called baby boomers are socking away money in retirement savings plans. The bad news, according to StatsCan, is that half of households with workers aged 55 to 65 have a financial net worth of less than $120,000. What this means is they can't retire at the same standard of living as they have had in their working years.

But Retirees need only 60 percent of working income, according to a Russell Financial Investment Canada survey. The Harris/Decima poll of 2,200 Canadian commissioned by Russell Investments Canada Ltd. found that currently retired people say they need only 60 percent of the income generated when they were working -- a stark contrast to a similar survey a year ago from Fidelity Investments Canada which found 80 percent or even higher "replacement ratios" might be necessary.

See retirement quotes about the Importance of Money in Retirement:

Another Retirement Book Reaches Sales of Over 100,000 Copies Giving Credence to the Claim That It Is The World's Best Retirement Book

With sales of 250 copies to Ford Motor Company, 250 copies (a total of 1,100 copies to date), to Syncrude and 2,000 copies (for total of 3,700 copies to date) to Allstate Financial in the last month, my retirement book How to Retire Happy, Wild, and Free has now reached sales of over 100,000 copies (counting foreign sales).

This means that I have two retirement books which have surpassed the 100,000 mark given that my other retirement book The Joy of Not Working has now sold over 225,000 copies.

The Joy of Not Working Has Kept Me Going for Years

It is now 17 years since I wrote The Joy of Not Working: A Book for the Retired, Unemployed, and Overworked.

I consider this book The World's Second Best Retirement Book (after my How to Retire Happy, Wild, and Free) although retirement coach and seminar presenter George Fulmore in California considers it the best.

For the record The Joy of Not Working has now sold over 225,000 copies; it has been published in 17 languages. This book has kept me going in more ways than one, including financially and psychologically.

Indonesian Edition of The Joy of Not Working

I have received several letters from people in Japan who have read the Japanese edition of The Joy of Not Working - the cover of the Japanese edition is below.

Here is one of them from Ayumi Nakabayashi in Osaka, Japan written in the first half of 2008:

Dear Ernie:

I have just read you The Joy of Not Working and I'm writing to thank you.

I'm a single working mother with twin daughters. What this means is I'm a poor miserable woman in Japanese society, so I am always worried about money for the future more than necessary and never enjoying my present life.

This book gave me a different view of my life, which I should pay attention to. I don't earn much money but enough to live, and have free time to enjoy. I feel excited about thinking how to spend my free time now. I'm making an "Idea Tree" [Get-a-Life Tree] after writing this letter. To read The Joy of Not Working in English is on the top of the list! I have forgotten that I have a lot of things I want to do.

This book gave me a chance to think over the relationship with boring people, too.

I'm sorry I don't have enough words to explain how I feel now in English, but I really appreciate you.

Sincerely,

Ayumi Nakabayashi

Here are the covers of some of the Foreign Editions of The Joy of Not Working:

French Edition

Spanish Edition

Japanese Edition

Czech Edition

Greek Edition

German Edition

Turkish Edition

French Edition - Canada

Dutch Edition

Korean Edition

Italian Edition

Chinese Edition - Traditional Characters

Chinese Edition - Simplified Characters

Portuguese Edition

Polish Edition

The Spoilers - Countries Against Early Retirement

Many of the news reports indicate that retirees will be retiring later than they had expected.

Some governments in certain countries are helping this trend by increasing their retirement age and hindering early retirement:

The Spoilers - Countries Against Early Retirement

1. Britain plans to gradually raise its age of retirement at which full
state pensions will kick in. By the year 2044, the U.K,'s retirement
age will be 68.

2. The U.S. and Germany also plan to raise their retirement age to 67.

3. Italy and Belgium have already raised their age of retirement to 60


T-shirt about Retirement
I'm retired: Leave the relaxing to me.

Coming Soon: The Joy of Being Retired: Why Retirement Rocks (and Work Sucks)

Retirement Income Should Be Adequate for Most Canadian Retirees

"A life spent making mistakes," stated George Bernard Shaw, "is not only more honorable, but more useful than a life spent doing nothing."

On that note, perhaps you are doing nothing at your job aside from putting in time.

Then it's time to retire.

But you are afraid to make a mistake because you may not have enough retirement income.

This information comes from Statistics Canada:

About two-thirds of "near-retirees" anticipate that their retirement income will be adequate or more than adequate to maintain their standard of living once they have left the workforce.

Individuals who receive advice are more likely than others to express confidence in the adequacy of their retirement savings to maintain their standard of living in retirement.

While most Canadians approaching retirement receive financial advice, including advice about retirement planning and programs, almost 3 in 10 do not.

Individuals who do not receive financial advice are less likely to expect their retirement income to be adequate than those who do receive advice. This relationship remains even when other characteristics such as income, pension coverage and registered retirement savings plan assets are taken into account.

Of the 7.2 million Canadians aged 45 to 59 in 2007, about 80% or 5.7 million were actively or recently employed and had not previously retired.

Of these 5.7 million near-retirees, 71% received financial advice from at least one source, and 50% received advice from at least one source in the financial industry. Almost 3 in 10 (29%) did not receive financial advice from any source.

While most individuals approaching retirement said they understood Canada's public retirement income programs, such as the Canada Pension Plan, Quebec Pension Plan and Old Age Security, one-quarter said they did not understand these programs at all.

A number of factors are associated with the likelihood of receiving financial advice and understanding public programs related to retirement preparations. These factors include an individual's proximity to retirement, financial resources, and demographic characteristics.

Where to Hang Your Retirement Hat (Best Places to Retire) in 2008

“Go and live somewhere else,” advises John Osborne,,a resident of Victoria, B.C.“ Try doing what you think you’ve always wanted to do.” Osborne, a retired psychology professor from the University of Alberta, moved to Victoria after he found retirement living left a lot to be desired in his old hometown of Edmonton, Alberta.

Perhaps, like many retirees, you too yearn for a change of scenery, new experiences, and a changed set of circumstances. Moving to a new location within your own country is one way to satisfy these yearnings.

Going abroad is another option. Indeed, as many as two million American retirees currently live abroad, according to David Warner, professor of public affairs at the University of Texas at Austin.

If you need guidance on where to retire abroad, one of the best sources is International Living magazine. The editors of this magazine evaluate the best places to retire in the world using the following criteria with the respective weighting.

• Cost of Living — 20 percent
• Health Care — 20 percent
• Special Benefits — 20 percent
• Real Estate — 15 percent
• Entertainment, Recreation, and Culture — 10 percent
• Climate — 5 percent
• Safety and Stability — 5 percent
• Infrastructure — 5 percent

Surprisingly, Panama which had been at the top of the list for six straight years has fallen to fourth position this year as the best place to retire. Here are the top three best places where to retire according to International Living magazine.

1. Mexico
2. Ecuador
3. Italy

In short, Italy in the number 3 spot has great weather, beautiful cities, and many historical sites. Ecuador in the number 2 spot offers an extremely low cost of living, great weather, beautiful landscapes, a vibrant economy tied to the US dollar, and a stable political environment.

Insofar as Mexico, it wins the top spot due to its Senior Citizens Benefits program, the quality of life that expat Canadian and American retirees can enjoy, investment opportunities, and the fact that it is relatively convenient for Americans and Canadians.

See Where to Retire Quotes and Best Places to Retire Information