New Benefits to Working While Retired
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New Benefits to Working While Retired

The recently released federal budget has a few new wrinkles. The Liberal government announced changes in the budget that will benefit those working through their retirement.

In particular, the federal budget allows working seniors to keep more of their income before triggering a claw-back in the Guaranteed Income Supplement (GIS). Under the old rules, eligible seniors and their spouses can only earn up to $3,500 a year per person before triggering a reduction in GIS benefits, and earnings from self-employment were ineligible for an exemption.

Under the new rules eligible seniors can earn up to $5,000 from any combination of employment and self-employment income before the government rolls back benefits.

The changes come into effect in July 2020 and will cost the federal government close to $1.8 billion over four years.

Another development is a proposal to introduce ‘advanced life deferred annuities’ or ALDAs to seniors. These annuities would pay out a set amount once activated on a
specific date. Currently annuity payouts must start by age 71.

With an ALDA however, Canadians could defer payouts until their 85 th year of age. The measure was proposed to try help Canadians keep more money in their registered retirement income funds (RRIFs) for longer.

Overall, this is welcome news to those who are working while retired. A lower tax bill encourages more engagement in the economy at a time when life spans are expanding, and experienced professionals have a lot to offer and companies that
need their wisdom.

How Many People Are Retiring?
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How Many People Are Retiring?

In the United States alone, close to 10,000 boomers are retiring every day. While that may seem like an inflated figure, according
to Pew Research and the Social Security Administration it’s accurate.

This begs the question – are North Americans prepared to live comfortably post full-time
career?

While there is no easy solution, there are services that work to leverage the skills of experienced professionals in a way that suits their lifestyle.

Whether it’s entrepreneurship, contract work, volunteering or board advisory, there are many roles that would benefit from the vast experience and knowledge possessed by recent retirees.

Flex-Time Work Desired By Boomers
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Flex-Time Work Desired By Boomers

The Globe and Mail recently reported that Baby Boomers are seeking shorter-term employment to supplement incomes and pursue their passions.

In particular, older part-time workers are more likely to find jobs in management and finance roles as companies struggle to adopt retirement transition plans for senior leadership.

In another sign that the Boomer brain drain shows no signs of abating, the article reports that “The share of older Canadians in the work force is only going to keep growing.”