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Retirement Planning > Retirement Investing

Boomer Retirement Hits Home

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I have two members of my family—the important ones—who are turning 65 this year. And in addition to figuring out an appropriate gift to mark the occasion (I settled on gift certificates, as my parental units have appreciated that in the past), the momentous occasion is also an opportunity to see this new wave of Boomer retirees in action. And the issues they are going to face, unique to their generation.

My parents’ situation is a little different as they are retirees living in Canada, where—as I discovered on a visit to my homeland last weekend—the situation is still a little different than it is here in the United States, for both retirees and those still working away.

Thanks to a stronger banking system (with actual regulations, and such), the subprime meltdown never happened, and the Canadian economy—admittedly, generated by a total population about the same as California—was not impacted, though the global shakedown is starting to have its after-effects.

Canadians still enjoy significant pensions, especially the Boomers, and even some younger friends of mine boasted about their own pensions and well-established RRSP accounts, the Canadian equivalent of the embattled 401(k). The Canada Pension Plan still seems well funded and operative, with less of the hand wringing we all experience when thinking about Social Security here, and its future.

My parents actually retired nearly a decade ago and have been enjoying the pension benefits, though 65 means an end to their employer-sponsored health care benefits, which have supplemented the basics of the comprehensive and still controversial Canadian health care system.

Learn a little bit more about the Canadian system and you will find that everything you’ve heard is true, and is also absolutely untrue. The waiting lists for even basic procedures you’d have taken care of within the week in the United States (if fully and privately insured) are indeed true.

Universal health care is an accepted socialist dream—fueled by ridiculously high taxes ($6 a gallon premium gasoline in British Columbia, for instance)—but the reality of access is another issue entirely, especially in those many remote communities.

And not paying directly for your health care also impacts the users’ psyche, as every commentator on Fox News was clear to note during the early days of the ongoing American health care reform debate.

Up until this year, my family paid prescription “copays” of one or two symbolic dollars per refill, which is set to change as they’ve hit 65. We are not sure if the asthma medications we share in common will now be closer to their $400 a month no-insurance, retail cost. Their doctors’ visits also remain free, but long waits are, again, the norm.

It’s far from the amiable utopia health care reformers spelled out, but it ain’t that bad for Canadians, either—especially the pensions part. And I doubt things are quite as carefree and rosy for the many 65-year-old Americans who simply trusted that their largely non-existent company pensions, their 401(k)s and Social Security would see them easily glide into a comfortable retirement.

As for me, I straddle the two worlds, having lived in the United States for a decade and a half and having been paying into the Social Security system, but fully aware that those “entitlements” the Right keeps ranting about will be long gone when I age. I just checked the statement for my 401(k) and it lost more than 10 percent of its full value in the last three months.

I’m fully suspecting to be living in my parents’ basement in Canada in my 70s. We all need something to reach for, right?


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