Four vibrant women huddled in a group hug, smiling brightly, with the open sky behind them.
As inflation continues to squeeze household budgets, nearly half of non-retired Canadians (46%) are choosing to spend on their lifestyle now rather than save for retirement — a decision rooted in both necessity and a growing “life’s too short” mindset.
Why it matters: A 2025 IG Wealth Management survey reveals that debt and rising living costs are major obstacles to retirement savings. Nearly 4 in 10 Canadians (38%) say they’re too busy paying off debt, while 18% simply want to enjoy life in the moment.
“Rising costs and mounting debt repayment challenges often undermine Canadians’ ability to save for retirement,” Christine Van Cauwenberghe, IG Wealth Management’s head of financial planning, said in a statement.
Respondents have aspirations for their retirement years, it’s simply that the demands of the present – debt and other financial pressures – are taking precedence.
Roughly 80% of Canadians say the rising cost of living is the single greatest barrier to building their retirement nest egg. More than half (56%) have delayed or stopped saving altogether, citing a range of pressures including debt, housing, and childcare.
The average Canadian household now spends 67% of their income on essential expenses and another 20% on discretionary spending, leaving just 12% for retirement savings. For many, the math simply doesn’t work.
While 47% of Canadians hope to retire before age 65, reality may not align with optimism. One in three expect to delay retirement due to financial necessity — whether to afford basic needs, boost income, or stay socially connected through work.
Real-world example: A 58-year-old Toronto resident recently told CBC she put off retirement plans after her rent rose by $300 per month. “I thought I’d be gardening — now I’m considering a part-time job,” she said.
Read more: ‘You’re going to live on beans and rice’: This senior told Dave Ramsey she has debt and zero savings — here’s his response plus 3 retirement saving tips to get you back on track
Canadians now spend nearly 9 out of every 10 dollars on immediate needs and wants — with only 12% left for their future. In a culture that encourages living in the moment, saving for decades down the road feels out of reach.
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