The percentage of Canadians that will be over 60 in 2050 is forecasted to be over 30 per cent. The percentage of Canadians over 60 is already hovering around 20 per cent. The default age of retirement has been 65 for many years and while it is not mandated by law, many Canadians retire around this point in their lives.
Canadians are now living longer than ever. Whereas retirement used to be towards the end of our lives, nowadays many of us can look forward to almost a third or more of our lives left to live when we retire. This situation is becoming more common as people are living well into their 90s and sometimes past 100. Canadians are also living active lifestyles right into their senior years; for example, travelling and joining teams or groups. However, the growth in the number of people retiring, combined with a longer life expectancy, creates a number of unique issues.
One issue is that, with increased life expectancy, the children of those passing away are often of retirement age themselves. Two problems can stem from the involvement of retirees in estate litigation. Firstly, they may have a lot of free time and get overly involved in the litigation, leading to increased cost and delay, as well as putting psychological and physical strain on retirees. Secondly, they may wish to live their life in retirement free from any worry of litigation and, hence, not want to become involved at all.
Another issue is that of the mental health of retirees. While people are often happy about their retirement at first, there are a high number of retirees, especially men, who become depressed shortly after retirement, says Laura Tamblyn Watts, senior fellow at the Canadian Centre for Elder Law. It can be difficult for people to say goodbye to their careers, colleagues and lifestyles.
Like other life events such as marriage and the birth of children, retirement should be a trigger for the consideration of estate planning. Retirement is a major life event, both socially and financially. Depending on the person and situation, retirement could require changes to previously established estate plans. As a result, it is important to review any plans in place. Knowing that your wishes are properly documented can also ease the transition and provide comfort in retirement.
At the time of retirement, while most people have a good idea of their assets and future income, issues of capacity to make decisions regarding estate plans are much less likely to be present than in older populations. For example, an elderly person preparing a bedside will towards the end of his or her life can raise suspicions, whereas a recent retiree attending the office of his or her lawyer does not raise the same red flags. For the foregoing reasons, consideration of an estate plan at the time of retirement can be ideal.
*Ian Hull and Suzana Popovic-Montag are partners at Hull & Hull LLP, an innovative law firm that practices exclusively in estate, trust and capacity litigation. To watch more Hull & Hull TV episodes, please visit our Hull & Hull TV page.