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Filed Under:Life Insurance, Life Planning Strategies

Older Canadians are better off than their parents in the 1980s

Median net worth of households headed by someone aged 65 and older rose more than four-fold between 1984 and 2012.
Median net worth of households headed by someone aged 65 and older rose more than four-fold between 1984 and 2012.

Seniors today have never been better off financially. And they are four times richer than their parents were at the same age in the mid-1980s, according to a new report from BMO Economics, released today.

The second part of a study, the report examines market and financial indicators affecting seniors (those 65 years and older) compared to the mid-1980s the first part released in May found that Millennials — those aged 25-34 years — are faring better in terms of jobs, wealth and income than their parents were at the same age, but are juggling increased debt and higher housing costs.

“Many Canadians 65 years and older have benefited from strong equity, bond and real estate markets, rising participation in the workforce, and higher pension benefits," says Sal Guatieri, senior economist, BMO Capital Markets. "The financial position of young families has improved since the 1980s, but has greatly lagged seniors. Barring a high-paying job, most young people will be pressed to replicate the financial success of their grandparents and parents."

Among the report’s key findings:

Senior working

Jobs: Workforce participation has increased compared with three decades ago

  • About twice as many seniors work today than three decades ago.
  • The employment rate for people 65 and over has doubled to 13 percent.
  • Labor force participation has increased, resulting in seniors having a harder time finding jobs because of more competition.
  • Unemployment among seniors has nearly doubled since the mid-1980s, although it is lower than for other age groups.

Money tree

Incomes: more seniors are receiving a pay check

  • Adjusted for inflation, the median income of people 65 and older rose 40 percent to $23,700 in 2011 from $16,900 in 1984.
  • Seniors have increased their spending power faster than people aged 55-64 and 25-34 years.


Wealth: Older Canadians are wealthier, driven by rising stock, bond and housing markets

  • Median net worth of households headed by someone aged 65 and older rose more than four-fold (312 percent) to $460,700 in 2012 from $111,693 in 1984 (in constant 2012 dollars).
  • Canadian equity returns, including dividends and after inflation, rose more than twice as fast in the past three decades than in the similar period before the mid-1980s.
  • Today, the typical senior is nearly nine times richer than the typical millennial, a wealth gap between similar age groups that has more than doubled since 1984.

Senior biking
Housing: More seniors own a house

  • The home ownership rate for seniors is at 70.8 percent for 2012 compared to 61.2 percent in 1984.
  • This implies strong demand for renovations, with seniors spending more on maintenance than other age groups.
  • Growing number of households headed by a senior have a mortgage (12.1 percent in 2012 vs. 8.3 percent in 1984).

Old person

Debt: More seniors have debt, but small amount compared to assets

  • The share of seniors with a loan has increased from 42.5 percent in 2012 to 26.1 percent in 1984.
  • Amount of debt held by a senior is small at $18,000 in 2012, a fraction of total assets ($479,000) and less than annual income.

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Nichole Morford

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