BASIC LIVING EXPENSES FOR THE CANADIAN ELDERLY

Our research undertakes to determine the basic living expenses required by Canadian seniors living in different circumstances in terms of age, gen-der, city of residence, household size, homeowner or renter, means of trans-portation and health status. The paper develops required expenses for food, shelter, health care, transportation and miscellaneous. The research identi-fies the typical expenses of seniors in each of these categories. Using 2001 as our base year, we follow the US Elder Standard to build an elderly threshold for Halifax, Montreal, Toronto, Calgary and Vancouver. The research is unique because it is the first Canadian study of abso-lute basic living expenses tailored to seniors, rather than simply to adults in general. This information is important to seniors, prospective retirees, finan-cial planners, policy makers and actuaries in assessing the minimum level of income required in retirement and the adequacy of savings and income se-curity programs. Our conclusions suggest that individual circumstances, rather than age, are the primary drivers in determining the cost of these basic expenses. Se-niors are a diverse group, particularly with respect to health, so it is impor-tant that seniors and financial planners do not blindly rely on a fixed replace-ment ratio or universal level of income when projecting the level of finances needed to retire. This research enables the reader to determine the threshold that is suited to a senior’s general circumstances