Save. Spend. Splurge.

My parents can’t afford to continue living their expensive lifestyle

Can you rely on your government to fund your retirement?

Obvious answer? No.

..but maybe none of us are truly aware of what that means, because we don’t seem to be taking this retirement thing seriously until we’re in our 50s and realizing that  retirement is only about 10 – 15 years away, and we can’t actually afford it.

Here’s what Canadians can expect:

The MAXIMUM we can get from CPP and OAS is:

CPP = $1012.50 a month if you retire at age 65

OAS = $550.99 a month

Grand total: $1563.49 if you qualify for maximum CPP & OAS (which is hard to do)

If you’re REALLY hard up and have no money at all, then there’s also GIS which is guaranteed income supplement, but you need to be really making next-to-nothing and to have nothing saved to qualify.

(I myself have taken dividends as an income, so I don’t qualify, which makes me all the more aware that I am not to rely on the Canadian government for any money.)

We simply can’t rely on the government for our retirement.

Even more telling?

” In Canada, 72% of us have no corporate pensions.

Half of people have no RRSPs, and the half that do have an average of $42,000.

[…] 51% of Canadians can’t lay their hands on $10,000 in the event of an emergency.

And yet about 75% of Boomers have houses. “

For our friends down south, the maximum payout (which I am assuming is following the same rules as in Canada)…

” In the United States where the maximum Social Security payment is $1,923 a month if you retire before age 63;

$2,533 if you wait until you’re 67 (if you were born in 1959 or later);

and $3,350 a month if you hang in until you’re 70. “

Sounds pretty sweet right?

That is, if you don’t croak before, and if you don’t factor in that you need to still qualify for Medicaid or some form of healthcare because you are sure to need it when you get older and if you don’t have any money to pay for it…… well you’re out of luck.

Of course to qualify for this max payout, you need to have been working for quite a while, not to mention requiring the support of all those illegal aliens working in the U.S. under fake (or real) Social Security numbers, paying into your retirement.

I also don’t think that those numbers are sustainable or realistic in the coming years, because it sounds.. impossible, but hey, with all the illegal aliens paying into the pot and not being able to collect one red cent, perhaps it’s true.



I think they’re also saying that we are all dying sooner than we’ve expected (obesity, heart attacks, cholesterol, take your pick) and can expect to live our last 10 years in sickness, which makes healthcare in old age even more important, and it’s something that Americans don’t really have.

When you use up your body by cramming it full of junk food, ignoring your ballooning weight gain, or are in denial that you have a disease like type 2 diabetes that you have to take care of, your body starts to break down.

It is no longer a well-oiled machine because you’re not oiling it or using it judiciously, you’re pouring sludge into it and abusing it to the point where your organs start to give out and fail sooner than expected because you’ve exhausted their life spans.

Health is a lot more important than we all think.

To sum up health-related issues for our retirement: We simply aren’t taking care of ourselves which makes the situation worse, and we don’t even have money set aside to pay for it.

Case in point: My parents are house-rich, cash-poor but even that is not enough to pay for 10 years

(See Jane Savers? I DO read your requests!)

Basically, Garth is saying everyone is house-rich in Canada and cash-poor, which if my parents are of any indication, is absolutely true.

My parents are kind of in that awful range of Baby Boomers who haven’t done jack squat to save for their retirement for the past 40 years and even worse, can’t really seem to bring themselves to care as much as I think they should.

Before I came along last year, my mother couldn’t put her hands on $10,000 for an emergency.

My parents own (free and clear) a $500,000 home. If you ask my mother, she tells you it’s probably closer to $650,000 – $700,000 because it’s a detached home on a quiet street, because detached homes have been selling in that range in the past 5 years. I call that sheer delusion.

I tell her that her home is only worth what she would have to pay in rent if she didn’t own it, seeing as I am not convinced this house would sell for $700,000 with the lack (read: complete and utter absence) of maintenance and the horrible DIY crap my father has put into this place over the years.

To get this place into sellable condition, they would need to sink about another $30,000 – $60,000 to fix everything and redo everything he has touched. He has done so much “remodeling” in this poor house, that in hindsight he was better off just leaving everything as-is because now we have holes in the ceiling and in the wall from his projects.


Aside from their home being their biggest and really, their only asset, how much do they have saved?

  • Retirement Fund (Government): $100,000
  • Cash: $20,000

Their net worth looks something like this based on my estimations:


The only thing that saves them is that my parents have a generous employer pension plan that kicks in when they decide to stop working, that gives them about $25,000 gross a year.

(Oh and I am not including the car that they own because frankly even though they paid $20,000 for it used, it can’t even sell for $5000 with the abuse my father has heaped on the car with his reckless and idiotic driving. No one in their right mind would buy this lemon with scratches and dents all over it.)

$25,000 a year doesn’t sound like much, but considering that she only started working about 10 years ago, this is not too shabby.

On top of that, they’re getting OAS and CPP to the tune of about $500 a month between the two of them, or $6000 a year (because they didn’t work most of their lives), all while my mother is still currently working at a $90,000 a year job.

So they pull in close to $100,000 in gross income between the two of them, with my mother earning the bulk — about 95% of that income. If she runs into a health problem now (heaven forbid) they are basically up the creek without a paddle.

They pretty much live paycheque to paycheque from what I can see, but my mother does at least try to save $1000 a month, however once she starts to see the balance add up, she gets the itch to spend it all, and it can be hard to rein her in when she sees pretty things.

My father? He’s just a wasteful, gambling-addicted, lazy, delusional degenerate. And I am being kind.



The money flows out of their fingers and into any one of these pots:

  • Gambling on lottery tickets at about $500/month for my father, about $100/month for my mother
  • Eating out in restaurants costing $500/month at least
  • Vacations costing $10,000 a year
  • Food wastage as in they buy groceries and then it all goes rotten at about $200/month

Utter junk.

Now, keep in mind that I wouldn’t be calling ANY of that wasteful spending if they had a fully funded retirement fund and a set future ahead of them, because now they’re just enjoying their money even if they choose to waste it. In fact, they had a GREAT start at the age of 35 because my parents won the lottery.. but then they wasted most of it on themselves.

I call it utter JUNK because they DON’T have anything saved and are living as though they have millions stashed in the bank, when in reality they cannot sustain their current lifestyle without a $90,000 gross a year income.

Between OAS and CPP at $6000 a year, and my mom’s retirement plan at $25,000 a year, they can expect a gross income just barely above poverty level at $31,000 a year if she were to retire.

This is a far cry and a deep money drop from the $90,000 lifestyle they are used to.

Now do you understand why I am so stressed out sometimes?


Let’s pretend they were to retire tomorrow: the only way they can survive for a little while longer, and live with that kind of generous $90,000 lifestyle is if they sell their home at $600,000 and live off that money for the next while.

Let’s say they end up with $450,000 net after having to fix up the home to undo all the crappy DIY jobs he did, pay realtor fees and so on, and they want to continue living that $90K lifestyle, gambling and wasting their money.

The math works out (with that $31,000 supplement from the government and her job), that they would blow through that money in a little over 7 and a half years.

Their house, once sold, would only help pay for 7.5 years in retirement.

.. but what if they live longer?

Until 90?

How the HELL are they going to pay for the last 10-15? I know that they think that we kids are their retirement plan, but I am not interested in enabling addicts.


I haven’t worked in the past year or so (really, two years), and I am out there spending gobs of money on clothing and vacations as well.

The only difference between me and my parents is that all of my net worth is 100% mine, BF has his own savings as well which I do not track or disclose, but you can imagine that we aren’t in dire straits.

To top it off, I am also less than half their age.

I still have time (as I like to remind myself) to save for that eventual million or two when I retire, and while I do spend and enjoy my money, I am aware of what it is costing me.

Anyway, my point circles back to this:

Retirement is inevitable and coming, whether you want to pretend you have time ahead of you or not.

If you want to stop working ONE DAY and give your old, sick bones a rest, you need money to be able to do this.

So take stock of what you have today.

Make up your own net worth chart, and think carefully (long and hard) before putting everything you’ve got into a single fixed asset like a home, because eventually, you will need to retire and unless you sell that home, the capital is locked in there for good.

Otherwise, you will end up like my parents.

Oblivious until the storm hits and they realize that they have to take a $60,000 / year drop in spending because their income has been slashed by two-thirds.

Now, what do to about my parents?


  • Bongo

    Just a heads up… anyone planning on receiving OAS, make sure you save old airplane tickets, passports, permits, licenses, diplomas, grocery receipts, parking tickets and used coffee cups going back FOREVER because they want every ounce of proof to show your active presence in Canada for decades. Don’t assume that since you’re a Canadian Citizen that you will be automatically approved for OAS. Case in point, a person I know landed in 1983, received citizenship in the early 90’s, etc, owned homes, cars, businesses with employees, married twice.. .all in Canada. Then happened to spend 8 years abroad in the 2000’s taking care of an ailing grandmother. Returned to Canada. Savings whittled down and he’s been in a legal battle for 3 years to get approval for OAS. Basically at age 69 he’s living on credit card and welfare indefinitely just crossing fingers hoping OAS gets approved then of course being approved for GIS too.

  • Chris Grande

    wow seems typical though. There are plenty of people who are in this position. Makes me worry about future taxes as one way or another, we will pay for them.

    I’ve had a couple of clients come to me in this position. Thankfully they can always sell the house, move to Florida, but a condo for 120-150k USD, and their 1600 ss check plus the profit from the home and maybe a pt job to keep it safe, they’ll be ok enough – if they choose this big move

  • Jane Savers @ Solving The Money Puzzle

    I could live very, very well on a work pension of $25,000 per year. My small work pension will give me less than $5,000 per year, I am trying to save and I am relying on the government pensions that will be no where near the max. My home is valued at just over $200,000 and I should be able to live on that for about 10 years.

    I may even take a reverse mortgage so I can retire at 59 or 60.

    Maybe you should just move to Montreal now. Distance from your parents would reduce your stress level.

    Your parents are fascinating but seldom do the children of unsensible parents turn out so sensible. You are lucky that you were upset by the way they live instead of thinking that their lifestyle is normal.

    • save. spend. splurge.

      Yes, YOU could 🙂 I have no doubt you could make that dollar stretch, but lifestyle inflation has been increasing over the past few years because my parents see the gross dollar amount earned rather than what is really left over as disposable income.

      As for moving to Montreal, I will be doing that, but I want to give birth in Toronto.

      (And I did for a while, think their lifestyle was normal… until I met other parents who were far more sensible and realized that it wasn’t.)

  • Jaime Lila

    This post is really sad.

    Some of it is not making sense, what do you mean they didn’t work most of their lives? Did your parents inherit their money?

  • Romona@Monasez

    I’m already preparing for when my mom gets old. She hardly works now and I know I’m going to have to take her expenses one day.

  • Anne @ Unique Gifter

    There are relatives of ours that we don’t think will be able to make their savings last, based on what we can observe. A new vehicle that cost ~50K every 4-5 years, new trailers, big trips, new sports gear, dinners out… given what we know about their careers and that this type of spending has been the case forever, I think they’re going to have some problems in ten years.

  • MelD

    The more I read/hear about other countries, the more I want to crawl into my Swiss coccoon – why would I even consider living anywhere else?! Having said that, my mom and grandmother are not poor in their old age (the former on a British/German/Swiss pension and the latter on an English widow’s/OAP pension), but they are both naturally very modest in their spending and expectations. However, both own their own (modest) homes.
    Neither has to fear any of the horrors you describe or that I keep reading about. What was that about the land/s of “freedom” and “opportunity”?! 😮

    • save. spend. splurge.

      Well there is a lot of freedom and opportunity here.. the problem is that it is TOO free, to the point where people forget that there is no one to take care of them except for themselves.

  • Marcelina

    I feel your pain and want to scream at my mother. 61. Under $100K in retirement savings. No pension. No word of a lie her retirement plan is to die of a second heart attack. Obese smoker. Never remarried after my dad left her. Still has 4 yrs on her mortgage. Refuses to sell and move into somethjng smaller so I don’t consider it an asset. My dad, on the other hand, was frugal and now has $1 million in assets.

  • Michelle

    I have begun to worry quite a bit about my mom’s retirement. While her home will be paid off I don’t feel that there will be as much cash available for her daily expenses as I would like. I am currently working into my financial plan something to supplement her retirement. Also, I believe in mother-in-law units so I am fine with my mom living with me when she’s older and I have kids-free babysitting. LOL!! This is very cultural so it is what it is. My mom is extremely frugal but hasn’t had consistent longevity in her jobs. Sigh.

  • BetCrooks

    We had an elderly relative who never wasted any money while raising a family (4 kids). No vacations, no eating out, no purchases on credit, no “junk.” He worked hard until forced out by a plant closure into early retirement; Then he continued working but as a potter until he died (selling; teaching; etc.) He had a defined benefit pension but it was not indexed to inflation. So buy the 2010s he was making about $25,000/y from CPP, pension and OAS.

    He did fine, though, because he fully owned his house. So for the last few years (in his 80s) he got a HELOC on the house and spent what he needed to enjoy life knowing he would never re-pay it. That’s how he was able to afford his first two vacations outside of Canada, including visiting the land of his grandparents’ birth.

    If your parents could only bring their expectations down to a realistic standard they could live off a HELOC on their home and their various smaller pensions and government pensions. That sounds like a very, very, very big “IF” though!

    The way GIS works is that it brings your TOTAL income up to approx. $15,000 per year. So if you have CPP and OAS of, say, $12,000 per year and absolutely no other income from any source whatsoever, the GIS would top you up to $15,000. Investment income, rental income, etc, all gets counted towards the max $15,000 total income.

  • ArianaAuburn

    Not to stir the pot further, but could it be possible that your parents are “kicking the can” on retirement because they have kids?
    Some people may not see how things can get until they have hit rock bottom. It’s unfortunate but it’s not all lost if you have been able to help your mom see things a little more clearly. Men are just stubborn: until they go hungry.

  • Jessie's Money

    Just thought I’d share a tidbit for those retiring who are eligible for GIS (my grandmother) her annual take home winds up being about $12,000-$15,000.

    That’s it.

  • Stefanie @ The Broke and Beautiful Life

    No way! That much money on lottery tickets PER MONTH? And vacations per year? Scary. Thank goodness you aren’t following in their financial footsteps.

  • Alicia @ Financial Diffraction

    It’s absurd to me that your parents still buy lotto tickets. Do they know what the odds are of winning once, let alone twice!?

    Thankfully my parents have a very nice retirement laid out in front of them, but I see my parents helping my grandmother because she is trying to subsist on the government incomes without savings. It is a bleak existence, so my parents “gift” necessities to my grandmother on a regular basis.

    I do not want to be old and poor. Do your parents realize they will be?

    • save. spend. splurge.

      The odds of winning once, let alone twice are lost on them. Let’s just say basic math is not their strong suit, even fractions and basic interest calculations give them trouble.

      So your grandmother is currently living the nightmare my parents will face then. My parents do not know that they will be old and poor because they feel like they will live forever and my mom will continue working at $90,000 a year until she dies.

  • cj

    I always love having a healthy dose of honesty on a blog, even if it is at the expense of a parent. Everything is totally conditional, including family and love. It’s the way the world works. Delusion will get us nowhere. Moreover, this post has a valuable message and lesson in it. I am so happy we did not take out a loan for our home any bigger than the one we did. It’s a small town home. If it was a big ass stand alone home, we would have had to sell it years ago so we could live simply and financially sound. Well done, Mochimac/SS!!!

    • save. spend. splurge.

      It can be difficult to not want to upgrade your place to get the max house for your buck… I see lots of young couples looking to buy “AS MUCH HOUSE AS POSSIBLE” .. but those situations never end well.

  • SarahN

    I know you blog sometimes to provoke a reaction, so here you go :p

    OH my, imagine if you baby blogs the same things about you! I know you don’t agree with your parents lifestyle (I read almost all your posts since I don’t know when), but honey… You are part of both of them – and you did have the vision to evaluate your life and spending and the parallels. I suppose it’s a shame they don’t see things like you. They don’t decorate like you do. They don’t spend on organic and vegetarian food like you. But they are your parents. And I don’t think you have to bail them out (finial duty, read that post too), but just… I don’t know, a little more respect and leaving them to suffer their own dramas. They might have that wake up call when they are on $30k p.a. and change. Or they might not. But, time will tell.

    Like you, I save for my retirement. My parents save for their retirement (through their employers) and then have their home owned outright, plus two investment properties. Both have worked all their lives (though mum’s just resigned with no new job at this stage).

    • save. spend. splurge.

      Yes I know. I’ve thought about that, and my answer to what you’re saying is my parents already know all of this. I tell them this all the time, and I repeat myself until I am blue in the face.

      This is not news to them. If they read this post, they’d tell you that I’ve already said all of this to them many times over.

  • Dear Debt

    I have no advice for you, because my dad doesn’t work (and hasn’t for the last 15 years) and my parents aren’t much better with retirement and savings. It makes me sad because my mom makes so much money, yet they “can’t afford to travel” even though they want to, and are living basically paycheck to paycheck. I’ve tried to kindly point out things, but people get defensive, so I try to just worry about myself and hope that they can take care of themselves too.

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