Browsed by
Tag: government

On scams and fear of starving in retirement

On scams and fear of starving in retirement

John Oliver is amazing and it is the reason why HBO hasn’t canned him, despite the fact he stirs up a lot of legal drama. He does to a lot of great public service segments and most are well worth watching. Here is a show he recently did on pig butchering scams:

Now, this is an important PSA for everyone because I think that a> yes, we – and by “we” I mean “everybody,” including me – are prone to getting scammed; b> we have no idea how far the rabbit hole goes with organized crime getting in on it; and c> how important it is to come forward and tell people about how easy it is to get scammed. It’s incredibly embarrassing to admit that it has happened to you but it is so important to let others know. Forewarned is forearmed, after all!

But I think what struck me in the comments section were people who said, “Can you imagine having enough money in the first place that you could lose $350,000!” followed by, “Interesting to see this comment!! I was like “wow, I can barely afford my rent, no savings for a rainy day and they’re losing more money than I can save in 4 lifetimes!!”

I automatically juxtaposed these comments to the hysterical headlines of “CANADIANS BELIEVE THAT YOU NEED OVER ONE MILLION DOLLARS TO RETIRE*” that has plagued Canadian media in the past year. This lead to a bunch of rebuttals including from one of Canada’s most adorable couples who retired early(ish) with “only” $300 000 in the bank.

The reality is that even though people are supposed to save for retirement, most of them don’t. Many people just live on the average amount of government benefits. So I thought it would be interesting if I calculated it up for a person who made minimum wage their entire lives but who worked until they were 65. This is both for the Canada Pension Plan (which we pay into) and Old Age Security (which is welfare for old people**).

They would get a total of $17658/pa or $1471.50 a month.

Since that number is under the $21624/pa cutoff for a single person for the Guaranteed Income Supplement, a single person working a minimum wage job could get up to $1065.47 on top of that CPP/OAS amount, bringing the grand total to $2536.97 a month or 30443.64/pa. It’s not a lavish lifestyle but it is definitely manageable, especially if you have some paid off real estate, social or co-op housing, live in a low-COLA area or have a bunch of roommates.


If you somehow also managed to save in a TFSA – let’s say, $100 000 total over your lifetime – you could probably also take out 4% tax free during your retirement that would also give you an extra $4000 a year that wouldn’t affect your benefits at all. Again, not a high-on-the-hog lifestyle but manageable.

OH? You don’t think someone who makes minimum wage could save $100000 over 30 years? I mean maybe not…but also it would only mean saving $1380 OR $115 a month in a TFSA at a 5% interest rate, which is not out of the realm of possibility, either.

We all know that this is over a long time span and programs come/go/and get cut by governments all of the time & the future is unknowable. While we tend towards the catastrophic, things can also get better if you are a good saver and/or make more money over your lifetime. They can also get worse if, say, you were a stay-at-home spouse with someone who died and left you nothing***. I think focusing on what you can control, today, is better than letting the panic freeze you into inaction or living your life in fear.

Naturally, this is all just a thought experiment. I am sure you could nitpick this example to death**** but it is an example of one particular scenario out of many and it’s just to show people that all is not lost if you don’t have a million dollars in the bank. I feel that it is counterproductive to push the ZOMG IF YOU DO NOT HAVE A MILLION DOLLARS YOU WILL HAVE TO EAT CAT FOOD narrative in a province where we seem to be ok with Welfare being $733 and Disability (ODSP) just $1308 a month.

Don’t let the bastards get you down.


*Depending on your demographic, according to this BMO survey.
**This is exactly what OAS and GIS are as it comes out of the current federal budget. If you want to watch your old, curmudgeonly uncle lose his goddamn mind at Thanksgiving, tell him that he is actually on welfare and stand back and watch the sparks fly!
***HASHTAG TRADWIFE.
****I put in 1975 as the birth year but the TFSA has only been around since 2009, par example.

Is there a “Singles Tax?”

Is there a “Singles Tax?”

How the ‘tax’ on singles has people who live alone feeling the pinch

Economies of scale are clearly cheaper to manage, so in one sense: yes, there is a singles tax.

But reading through this article, the thing that really bugs me is this idea that “someone should do something” when people aren’t helping themselves. Jenn could get a roommate to reduce her costs or even get rid of her car as she lives in an area with great transit. But instead, she’s complaining about the high cost of living in the urban core.

The thing is, to live in an urban core we need to accept smaller spaces. When I was in my 20s and early 30s I always lived with roommates. We split the bills and sometimes even split food. It never occurred to me to live alone because even when rents were way cheaper than they are now, we didn’t want all of our money being eaten up by rent.

Then when I met Mr. Tucker we moved into a 510 square foot condo with our dog. It suited us just fine and got us out of the house for walks 3x a day and we spent an hour at the dog park every night after work – rain, shine or snow. We also walked or used public transit because owning a car in the city is just ridiculous. We did consider car-sharing companies but we didn’t follow through. Unless you were leaving the city on a trip, almost everything could be found in an urban centre and if we needed something outside of that, we just took cabs.

From the article:

“The average one-bedroom is now $2,458, according to a national report from rentals.ca in February. An apartment with a little more room and some backyard space for the adopted rescue mutt she dreams of would run her closer to $3,000 — and that’s a hefty price tag for just one person.”

In that same report however, a 2 bedroom would cost $3324 – or $1662 per person AND she could get a dog – if she got a roommate (who likes dogs). It is just flabbergasting to me that she lives in 595sq ft and is whining about how hard it is even though she has clearly not considered any money saving alternatives (get rid of the car, get a roommate who likes dogs and rent a larger place for cheaper). I respect if she chooses to live alone because she doesn’t want a roommate but she needs to own that choice and not complain about it.

There is the fundamental issue that I feel people in Canada and the US haven’t come to terms with: you are not entitled to have a lot of living space at a low cost in a great area. Of course, we all want this but it isn’t feasible because…we ALL want this!  But in order to make livable, walkable cities we all need to make concessions and one of those concessions is space.

In 1910 the average square footage of a house in the US was 800sq ft and now they are 74% larger. The average size now is $2430 sq ft. Our expectations are higher now than they’ve ever been and we want these homes at a low rate. Our expectations are really entitledness at this point.

For a comparison, our last home was 1200sq ft and our kids had to share a room because Mr. Tucker works from home and he needed an office. Our current home – a midcentury modern – is 1300sq ft and has a partially finished basement with an office and a rec room, which probably brings it closer to 1900sq ft. The bonus here is that we now have a powder room and both kids have their own rooms.

While I am coming down hard on people’s expectations when it comes to housing, there is a definite truth when it comes to food. Grocers do reward multiple buys of products which could lead to people buying things they don’t need and just letting the extra go waste because it’s cheaper. I also sympathize with anyone who is raising kids or taking care of a loved one on one income. Those are definitely challenges that need myriad policy-driven approaches.

In Canada at least, the government could get back into the affordable housing business again. This is not a party-specific issue, either: multiple governments have ignored housing issues for the past 20 years and the clever solutions that all levels of government are proposing aren’t clever at all and in many ways are increasing the problem. On top of that, we are poised to let in more immigrants over the next few years without even knowing where they’ll live.  While I definitely support the move, we need to think of how the infrastructure of this country will handle the influx.

What I think we need to accept is a tempering of our own inflated expectations. We are trying to live in a Friends world on a Roseanne budget. For our finances, our cities and our resources we need to look to places like Amsterdam with its great public infrastructure and to other European cities where they’ve normalized smaller spaces and where car ownership is just so incredibly expensive that everyone is invested in public transport and public spaces. Urban sprawl is not the solution to this issue, learning to live with less, is.