A new survey from BlackRock finds 70 per cent of Gen Z Canadians , aged 14 to 29, believe they are on track for retirement, while only 51 per cent of Gen X, aged 46 to 61, share the same confidence.
Adding to the uncertainty for older Canadians, it also finds 67 per cent of Gen Xers worry about outliving their savings.
The survey comes as Canadians are working and living longer. According to Statistics Canada, the average retirement age hit a record high of 65.4 years in 2025 compared with 61.6 two decades ago.
Adjusting to new realities over time
Tweaking your investment portfolio properly as you get older will maximize after-inflation returns over the long term and lower risk as you near retirement.
Determining what to hold, how much, and when depends on who you are and how you want to retire. A qualified advisor can help but make sure investment fees don’t impede growth.
A recent report from U.S. based wealth manager T.Rowe Price breaks down how investment portfolios should mature as we age.
Much of the advice applies to Americans but it can be tweaked as a guideline for Canadians.
Twenties: time is on your side
When it comes to investing, the biggest rewards come from the biggest risks. Young people have more time for that to happen, or to recover if it doesn’t.
T. Rowe Price says young investors should focus on the growth potential of stocks with at least a 90 per cent weighting on a diversified portfolio of equities.
Market gains can compound over time, but compounding works both ways when it comes to the debt many young households carry. In most cases, the interest will exceed anything the stock market can deliver.
The first priority should be to pay down debt starting with the highest interest rates, or consolidating all debt into a low interest loan.
Contribute what you can to a tax-free savings account (TFSA), which allows you to invest in just about anything without paying tax on the gains.
Open a registered retirement savings plan (RRSP) but only contribute if your taxable income that year reaches a high marginal rate. RRSP contributions and gains are fully taxed when withdrawn; ideally at a low marginal rate in retirement.
Thirties: add to equities, lower debt
The push toward equities should continue into your 30s as you chip away at your debt.
Kids and bills call for a mature strategy that includes investing in good companies that produce something with intrinsic value, and grow earnings over time.
Diversifying equities across sector and geographic lines will hedge against concentrated risk and widen opportunity. Mutual funds and exchange-traded funds (ETFs) can make it easy.
You can also hedge against equity market risk by directing more of your portfolio to the safety of fixed-income, including guaranteed investment certificates (GICs) and investment-grade bonds.
This could also be a time in life to get the most out of your company pension plan and work it into your retirement plan.
Forties: peak earning years
T. Rowe Price recommends pulling back from equities in your 40s and adding safer alternatives with less return potential. They suggest up to 20 per cent of your portfolio be allocated to fixed-income.
These are normally higher-income years when RRSPs make more sense. Refunds will be bigger because the contribution amount would have been taxed at a higher marginal rate.
A tax strategy that shifts RRSP refunds to your TFSA is a good idea. In retirement, RRSP withdrawals can be capped at a low marginal rate and TFSA withdrawals, which are not taxed, can be used to top up your income requirements.
Fifties: kids are out, book a flight to safety
Adults in their 40s and 50s tend to have more money to invest as basic household necessities are paid for and the kids leave home.
T. Rowe Price suggests further shock-proofing your portfolio by holding 15 to 35 per cent in fixed-income.
Reliance on capital gains from stocks gives way to a safe income stream from dividends and bond yields.
Be sure your RRSP savings don’t grow too much. In addition to having to withdraw them at a higher rate, Old Age Security (OAS) benefits could be clawed back if mandatory minimum withdrawals reach a certain threshold.
Sixty and beyond: moderate growth, reliable cash
Retirement takes your portfolio a full 180 degrees from saving to spending. Since money is not coming in, it is essential to have a reliable income source for day-to-day needs.
In your 60s, T. Rowe Price recommends a portfolio weighting pulled back to 45 to 65 per cent equities, 30 to 50 per cent fixed-income, and 10 per cent cash.
In your 70s and beyond, they suggest 30 to 50 per cent equities, 40 to 60 per cent fixed-income, and 20 per cent cash.
Your portfolio still needs to grow but that income stream, combined with Canada Pension Plan (CPP) and Old Age Security (OAS) payments should take much of the pressure off.
