And most Canadians are navigating it alone
Nearly 1.2m Canadian seniors are still working, and the system built to support their retirement was not designed for this reality.
Statistics Canada data shows the labour force participation rate for Canadians aged 65 and older reached 15.2 percent in 2025, with the average retirement age climbing to 65.4 years — up from 61.6 years two decades ago.
Bill McBay, a certified financial planner at T.E.A.M Financial Solutions with Sun Life Financial, told CTV News the numbers reflect more than rising costs and longer life expectancy.
“The new retirement plan that I'm seeing more than not is retiring partially,” he said, with many clients working past normal retirement age at something they always wanted to do.
McBay told CTV News retirement does not have to be all-or-nothing for those squeezed by costs.
“Let's just retire a little bit — let's retire Fridays if you can,” he said, adding that advisers should approach both scenarios without judgment. “I don't think it's a shaming thing.”
The deeper structural problem, according to Nick Nefouse, global head of retirement solutions and head of LifePath at BlackRock, is that the traditional defined benefit plan no longer drives most retirement outcomes in Canada.
Nefouse told BNN Bloomberg that individuals are now responsible for retirement planning and that target date funds have become the go-to vehicle, packaging complex decisions “into a single product” to remove the guesswork.
Nefouse described BlackRock's GPS framework — grow, protect, spend — as a way to structure risk across a working life.
For younger investors, the priority is growth and accumulation; the real risk, he said, is not saving enough.
At mid- and late-career, inflation and market volatility become the dominant concerns, warranting a shift toward inflation-protected bonds and higher-quality fixed income.
In retirement, the focus moves to sustaining spending power throughout what is now a much longer time horizon.
Nefouse identified what he called the “retirement window” — roughly ages 55 to 70 — as the period when inflation poses the greatest threat.
“You don't have as much time to make up for market losses, and you don't have as much capacity to rebuild savings after volatility,” he told BNN Bloomberg.
BlackRock recently made two adjustments in response: introducing shorter-term inflation-protected bonds, which pass through inflation more directly, and adding a small allocation to liquid commodities to its Canadian target date portfolios.
On the question of active versus index management, Nefouse told BNN Bloomberg the binary is misleading.
“Our target date fund is implemented with index building blocks, but it's still an active target date fund,” he said, noting the firm's research team recently recalibrated fixed income and inflation exposures in Canadian portfolios following recent inflation spikes.
For younger Canadians who feel wages are too low to begin investing, Nefouse said delay is the bigger risk.
“Starting in your 20s has a huge impact on what happens in your 40s, 50s and 60s. Even a small savings rate — 1, 2, 3 percent — will compound,” he told BNN Bloomberg.
He also reframed volatility as an advantage for younger investors.
“Volatility is actually your friend when you're young. You have a long time horizon and regular contributions every paycheque,” he said.
Both McBay and Nefouse converged on one point: retirement in Canada now spans decades, and most people are underprepared for how long it will last.
“Even for Canadians already in retirement, you're typically looking at at least two more decades on average,” Nefouse told BNN Bloomberg.
McBay said the best course for anyone uncertain of their path is straightforward — speak with someone qualified to build a financial plan.
