April 13 2010 by Ellen Roseman
Is there a phony retirement crisis in Canada? I often hear that people aren’t saving enough for retirement. But when I speak to retirees, I get a different story.
I did a column saying that living on half of what you earned before may not hurt, if you go into retirement with your mortgage and other loans paid off.
Readers agreed wholeheartedly. Many also agreed that financial institutions like to exaggerate the amount you need to save for retirement and suggest you need 70 to 80 per cent of your previous income to live comfortably.
But these firms have a conflict of interest when it comes to advice about reducing debt. They earn almost nothing from from accelerated mortgage paydown, compared to the management fees on sales of mutual funds and packaged investment portfolios.
Retirement is a hot topic these days. Many people are already there or getting close, wondering if they can leave early. They feel reassured to hear they may have saved enough, even if the investment industry says no.