Healthier lifestyle allows on-time retirement

by 08 Jul 2015
Canadians are working long past their retirement dates – and the demands being placed on benefits plans need to be addressed by insurers now.

“The results from our health index survey actually tells us that a number of employees will have to leave work early due to a health condition, so they are not retiring as planned,” says Andria McKay, director, business development (health and wellness) of Sun Life Financial. “That is an opportunity for an advisor to work upstream on some prevention strategies that can keep you employees retiring at the right time and contributing to a retirement plan, as opposed to potentially withdrawing early from those plans, because they are having to deal with a health event.”

It is that large Baby Boomer demographic that is coming under scrutiny, says McKay, which makes the need for workplaces to incorporate healthy lifestyle programs.

“There are multiple lifestyle programs that can create a healthier lifestyle, whether it is physical fitness, stress reduction, or a nutritional program,” says McKay, “those are some of the key areas we focus on.”

A Sun Life Canadian Health Index study, conducted by Ipsos Reid, reveals that almost 69 per cent of retired Canadians did not stop working on the date they planned.

Among those Canadians who did not retire as planned, 41 per cent cited personal health as the primary reason for retiring earlier.

“Sometimes employers don’t even know what their wellness objectives are,” McKay told LHP. “That is where working with a partner – like their insurance provider – can help define what they want to achieve and implement the right programs.”

In fact, 45 per cent of Canadians have experienced a health event with 23 per cent of them impacted by a mental health issue.

“Our research shows that Canadians who are not financially prepared to retire typically say they will work longer to compensate,” says Kevin Dougherty, President, Sun Life Financial Canada, “but unfortunately, they may not have that choice.”

Though Canadians cite that deteriorating health is a top concern (66 per cent) as they age, only 22 per cent have saved money or otherwise planned for healthcare expenses in retirement. This is a source of anxiety for many.

Highlights from the survey include:

- 53 per cent worry about the cost of drugs and medical treatments in retirement;

- 47 per cent worry about being in long-term care longer than they are financially prepared for; and

- 45 per cent worry about outliving their retirement savings.

“The statistics show your retirement date may arrive sooner than you expected,” says Dougherty. “Simply working longer to make ends meet may not be possible after serious health events force many Canadians to leave the workforce, triggering a surprise retirement date.”
Health isn’t the only thing weighing on people’s minds. The survey also finds that 76 per cent of Canadians are stressed out – citing money, money and money as the top three factors:

- 41 per cent worry about personal or household finances;

- 31 per cent worry about trying to maintain a budget; and

- 30 per cent worry about unexpected expenses.

Professional financial advice makes a difference.

The study shows that Canadians who have an expert to help with their finances are more likely to finish their careers as planned (40 per cent versus 25 per cent who do not work with an expert). Also,  82 per cent of Canadians who work with an advisor are confident they will be able to take care of their medical expenses in retirement.

Among those who don't work with an advisor, just 66 per cent said the same.