Over the past few decades, senior debt has risen dramatically as a more significant proportion of the Canadian population ages. The senior population in Canada (people aged 65+) has increased by 112.5% since 1999 and will likely increase to about 24% of the Canadian population by 2036, as per Statistics Canada. 

Since 1999, the proportion of senior families with debt increased by 55%, with the median amount of debt reaching $25,000, a 177% increase in that same period. Not to mention that interest rates have steeply risen in the past year. That said, family net worth has increased by about 80%, while “the median debt-to-income ratio for senior families with debt more than doubled from 0.24 to 0.52.” 

As a loved one of a senior, it’s crucial to ensure that they can manage their money effectively and make the most of their resources. Here are a few tips for how seniors in Canada can best manage their money:

Budgeting

The first step in managing money is understanding where it’s going. Help your senior loved one create a budget that outlines their income and expenses, so they can see where they can cut back or save more. To stretch that budget, CPA Canada has outlined a few ways to save money and stretch your senior loved one’s budget:

Ways for seniors to save money and stretch their budget:

  • Keep tabs on credit card debt, look for low-interest options or cashback cards, and treat them as debit cards.
  • Consider a reverse mortgage or downsizing your home to increase cash flow.
  • Check what insurance policies you already have for additions to coverage.
  • Seek out government benefits, including prescription drug coverage and vaccinations.
  • Ask for senior discounts from various places, including banks, stores, and professional services (or check out our article on senior discounts in Canada)
  • Get creative, such as comparison shopping for insurance and other services or negotiating better rates
  • Check for charges directly to their credit card or by direct debit, and review payments from time to time.

Senior Couple Discussing Investment Lynn Valley Care Centre Blog

Review financial accounts and documents

Keeping track of financial accounts and documents, including bank accounts, investments, and insurance policies, is essential. Ensure your senior loved one’s bills are up to date and that they understand what they have and how to access it.

Consider downsizing

If your senior loved one is living in a larger home, they no longer need, downsizing to a smaller, more manageable space can save money on expenses like property taxes and utilities.

Take advantage of government benefits

Seniors in Canada may be eligible for many federal or provincial government benefits, including Old Age Security and the Guaranteed Income Supplement. These benefits can provide extra income and help stretch your senior loved one’s budget further. Below i

Canadian federal and provincial senior income and benefit programs

  • Old Age Security (OAS)
    • Available to those 65 or older who have lived in Canada for ten or more years
    • Can apply six months before turning 65
    • Encouraged to complete an annual income tax return to avoid processing delays
  • Guaranteed Income Supplement (GIS)
    • Available to those receiving OAS with low incomes
  • Spouse’s Allowance
    • Available to a spouse of GIS recipients between 60 and 64
  • Canada Pension Plan (CPP)
    • Most people who work in Canada pay into the CPP
    • Quebec has a parallel pension plan (QPP)
    • Offers retirement, survivor, death, disability, and children’s benefits
  • Home Adaptations for Seniors’ Independence Program
    • Available for low-income seniors for certain types of home renovations.
  • Other federal programs for specific groups include war veterans, First Nations people, or those who have lived/worked in another country.

Most provinces and territories offer extra support for those receiving GIS or Allowance through the income tax system. Other provincial and territorial programs for seniors may include property tax deferment, rental subsidy, prescription drug subsidy, home support subsidy, fuel or utility subsidy, or bus pass subsidy.

Seek financial advice

If your senior loved one is having trouble managing their money, seek the advice of a financial advisor or professional. They can help develop a financial plan and offer guidance on making the most of your senior loved one’s resources.

Money Management For Seniors

By following these tips, your senior loved one can manage their money and make the most of their resources. It’s crucial to stay on top of financial matters to ensure a secure financial future for your senior loved one.

For more information on senior care, check out our Lynn Valley Care Blog, or call us today.