The recent news about improving the Canada Pension Plan for tomorrow's retirees has Harris Gulko feeling a little put out.
"There's a lot of material being written about what is going to happen to people in the future, and there's no regard for people who have been retired for 20 or 30 years," the 88-year-old Winnipeg resident said in an interview.
Mr. Gulko, a writer, painter and former professional fundraiser, is not an angry complainer. He just wants a little understanding for retirees like him who feel they're being marginalized or forgotten. For reasons related to both demographics and basic personal finance, let's hear him out.
Baby boomers are just starting to retire – they should know what they're up against in the decades ahead. Also, we too seldom hear from retirees about the financial implications of aging. Mr. Gulko agreed to help fill us in by listing some of the costs he faces that younger people do not.
First, some background. Mr. Gulko owns a condo in Winnipeg, where he lives alone. Back problems restrict his mobility, but he's active enough to be planning a trip to Mexico this winter. Travel medical insurance is one of the heavy costs he must bear, as we'll see shortly.
Manitoba has a pharmacare program, but Mr. Gulko says he's paying a significant amount to cover the cost of the seven prescriptions he takes regularly. He also spends roughly $160 a month on painkillers for his back and another $40 on vitamins suggested by his doctor.
His back issues make it impossible to take public transportation to doctor's appointments, so he racks up taxi bills of about $170 a month for those trips. The cost of wheelchairs, an electric scooter and special canes over the past three years came to about $4,600.
Higher heating costs are another issue for retirees like Mr. Gulko, who has auxiliary heaters in every room. "If I'm going to be in a room to write or to paint, I want to be warm."
Mr. Gulko says his monthly grocery bills are inflated by about $60 a month by the need to purchase prepared foods like salads. He can't do much meal preparation on his own, and neither can he clean his condo. That means a cost of about $180 a month for a cleaning service. His most dramatic cost has to be travel medical insurance for his planned trip to Mexico. With his health issues, he expects to pay the astronomical sum of $8,000.
"To be fair, living into my ninth decade has some saving financial benefits," he quipped in an e-mail he sent me about his living costs. "For example, at my age I no longer have to buy prophylactics."
The CPP enhancements announced last month will take full effect for people retiring decades from now. Current retirees will not see higher benefits, but they do get cost-of-living increases that are calculated once a year using Statistics Canada's consumer price index.
Mr. Gulko's issue is that cost-of-living increases don't offset his rising costs as a retiree in his late 80s. This offers a lesson to people looking ahead to retirement – your personal inflation rate may exceed the national rate, which most recently clocked in at 1.5 per cent. Exposure to the stock market, notably dividend growth stocks, may be needed to provide some inflation protection.
In a way, retirees like Mr. Gulko are fortunate. A recent Fraser Institute study showed people who retired in past decades got a higher return on their CPP contributions than those retiring these days. But money is really just a symptom of Mr. Gulko's sense of frustration. He feels people like him are marginalized by society, a complaint we would do well to take seriously as demographics drive a marked aging of our population.
It's not that Mr. Gulko finds people unkind. "If I drop a cane, people will rush to pick it up," he said. "They'll give me their place in line at the bank when they see me with a cane. When they see me reaching for a high shelf at the grocery store, they'll come and help me."
What bugs him is a sense of being pushed to the margins – overlooked in discussions about improving the CPP and patronized with labels like aged and senior. His message to everyone: Age is just a number.
"I'm an older person," he said. "That's a mathematical fact. I'm older – that's it."