Older Canadians may have the Advantage when it Comes to Economics
There’s been a lot of talk lately about older Canadians and how hard they’re going to have it now, and in the coming years. They have high levels of household debt, and Equifax recently announced that retirees have the most debt of any other Canadian group. Not to mention the fact that they’re already on a fixed income, and that that income is being threatened by new OAS rules. And while those rules may not be in effect for them, it does leave a kind of uncertainty as to what’s coming next.
But, the National Household Survey, which is to be released by Stats Canada on Wednesday, September 11, shows that this may not be the group in the most danger when it comes to economics. That group may actually be those 45 and younger.
“We’ve had decades now of talking about the pressures of an aging population – and we need to keep talking about that,” says Paul Kershaw, a public policy professor in the University of British Columbia’s School of Population and Public Health.
“But the NHS will help us uncover that those challenges are not the only, and maybe not even the primary, challenges facing Canada. There are new social and economic risks for younger generations that we’re not attending to.”
The first example he gives to prove his point is that, while the government invests nearly $45,000 per person in medical care and retirement income expenditures, it spends only $12,000 on those under the age of 45, in the way of education, medical care, and family spending.
And that’s not to mention what’s going on in real estate right now. Housing prices continue to go up every day, and that’s good news for the older Canadians sitting pretty in their homes. But what about the younger generation coming up behind them, that’s now faced with values so high that they can’t possibly ever afford one?
“For those who’ve had homes for decades, higher housing prices are gold; they’re THE factor driving wealth up and for those nearing retirement,” says Kershaw. “But those prices are crushing the dream of home ownership for their kids and grandkids.”
And Jim Murphy, CEO of CAAMP, agrees. He says, “We still have concern expressed by government about the overall Canadian housing market. Is it growing too fast? Are prices growing too fast? And what does that mean if there were to be a dramatic increase in rates?”
What do you think when it comes to the economics of the older generation versus the younger? Who do you think has the advantage, and why?