When Claire Pfeiffer borrowed a big sum from her mother to buy a detached, two-and-a-half-storey home near the Lansdowne subway station for $430,000 in October 2007, home prices were rising dramatically. She remembers feeling foolish for buying at what she thought was probably the top of the market.

“What we saw from that very moment onwards was just an incredible rise. But at the time I felt I overpaid,” she said.

Now houses like hers sell for more than $1 million. But paying the $1,800 monthly mortgage, which eats up about half of Pfeiffer’s approximately $3,800 monthly take-home pay, hasn’t left room in the budget for retirement savings. The 44-year-old communications professional says that sometimes keeps her awake.

Pfeiffer is among a growing number of Canadians struggling to save for retirement. In big cities like Toronto, the housing market — rightly or wrongly — is wearing much of the blame for lacklustre savings, particularly among millennials, the generation born between about 1981 and 1996.

A survey of young professionals by the Toronto Region Board of Trade in 2017 showed 83 per cent surveyed believed the high cost of housing in the area was impeding their ability to save for retirement.

But financial experts say the impact of the region’s affordability challenge extends all the way to the relatively well-off and better-pensioned baby boomers, who are hanging on to big houses longer and sometimes risking their own financial well-being to help their kids.

High house costs are set against a backdrop of declining defined benefit pensions, a rising gig economy and record household debt. At a time when real estate investments have offered some of the highest available returns, it may be tempting for some to treat their home as their retirement plan. But even if they’re willing to leave their nests in retirement, that’s not necessarily the wisest strategy, according to advisers interviewed by the Toronto Star.

About 25 per cent of Canadian workers in 2017 belonged to a defined benefit pension plan, the kind that offers an employer-guaranteed payout, according to Statistics Canada. That was down from about 36 per cent 10 years earlier.

Pfeiffer counts herself as “exceptionally lucky” among her friends, many of whom haven’t been able to afford a home. Of the people she knows who do own houses, more than 75 per cent have public service pensions, she said. She knows almost no one working in the creative sector who has bought one.

Her husband, Jesse Hawken, 51, a writer, has spent the last few years caring for an ailing family member and their son, 3. Now he is using an inheritance to contribute to household expenses while he searches for a job in the arts sector.

Pfeiffer, who began working at the Ryerson City Building Institute about a year ago, only started contributing to the university’s defined benefit pension plan last month. It will give her some retirement income based on her salary and tenure. If Hawken finds work, she says they would like to begin saving aggressively for retirement. But she fully expects to be working past the traditional retirement age of 65.

“I feel like I have a lot of equity that is tied up in the place that I love to live, but I can’t imagine ever leaving my home because I’m very attached to it. I very much love it,” she said.

“When I think about retirement, I think about living in the exact same place, I think about actually handing down my home to my son. I don’t imagine cashing out on my house and moving somewhere because I don’t know where we would go,” she said.

There are already worrying signs that retirements are in trouble, said Jacqueline Porter of Carte Wealth Management.

“More and more Canadians are retiring with a mortgage, which 30 years ago would have been unheard of. People are retiring with debt, with a mortgage, simply because they just didn’t plan well,” she said.

“I have conversations with clients all the time. Freedom 55 is out the window,” Porter said.

That 1980s insurance advertising slogan is dated for all kinds of reasons, she said, not least of which is that one of the fastest-growing demographics is centenarians. Living longer means we require more money than ever to retire.

Porter thinks Canadians take the economy and the rising value of homes for granted and that’s especially dangerous in an era of disruption.

“You can’t look at the last 40 years and think that’s what’s going to happen the next 40 years, especially as people continue to use their home as a piggy bank,” she said.

But Michael Nicin, executive director of the National Institute on Aging, a think tank focused on the finances, health and well-being of older Canadians, says the projected shortfall in retirement savings is more complex and more pervasive than the high cost of housing and individual household income challenges, particularly for millennials. It’s also not unique to Canada, he said.

He cites statistics showing that when it comes to household income, millennials are actually doing better than the preceding gen-Xers were at the same age. Their net worth is also higher. But they do carry nearly twice as much debt, a lot of it on mortgages.

Nicin suggests human behaviour is a significant factor and public policies need to address that by focusing on automated savings programs such as the recently expanded Canada Pension Plan, of which millennials will be the first generation to benefit.

“Most people in general don’t consider their future selves multiple decades in advance. They’re more concerned about current priorities — getting ahead, staying ahead, buying a home, going through school, daycare, kids’ education,” he said.

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“If we want to solve the retirement conundrum — because it is frightening with the aging population — it’s not just about individual households. There’s a social factor to consider when it comes to public support programs for seniors. Are they going to be sustainable with the aging population that hasn’t saved for itself?”

A 2017 report from the Ontario Securities Commission called “Missing Out: Millennials and the Markets” shows four in five millennials are in fact saving. But only half of them are investing those savings, instead allocating them to other priorities, including home ownership.

A Bank of Montreal study released in January showed that millennials had $28,821 in RRSPs on average, compared to $15,377 in 2016.

But even though more millennials are contributing to RRSPs than any other age group, the sums aren’t large enough to add up to retirement savings, said Nicin.

Personal finance expert Rona Birenbaum, of Caring for Clients, agrees that young people can’t imagine what it feels like to be 55 or 65 years old. She also thinks that comparing baby boomers to millennials is an oversimplification in such a dramatically changed world.

“We’ve now moved on more than 50 years since the boomers entered the workforce. When we talk about a 50-year time frame, especially given the technological advances, to think the economics of living would be the same is a bit deluded. I don’t think it should come as a surprise that there are some major differences is how people are living and housing affordability is just one of them,” Birenbaum said.

“It’s sometimes convenient to isolate one issue, housing in this case, and say, ‘We have it worse now, it’s harder now,’ while at the same time ignoring all of the improvements that exist,” she said.

There are other ways to accumulate retirement wealth besides real estate, said Birenbaum, who advocates a diversified approach.

“What I see in my practice is couples that head into retirement with a mortgage-free home and retirement savings or some form of pension — their financial trajectory over the rest of their life is stronger, is on more solid footing than someone who just has real estate,” she said.

But, she said, “retirees feel more optimistic if they have that piece of real estate in their back pocket when they’re 80. Retirees are less afraid to spend the money they saved when they know they have the real estate.”

Whether to buy a home — and like other financial advisers Birenbaum notes that rent can be similar to a mortgage in Toronto — is a financial choice based on an individual’s or a couple’s priorities.

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“Everybody wants to stay in Toronto but if it’s not economically viable, that puts the pressure on all sorts of prices. These people have found themselves in a city that has just gotten expensive very, very quickly and some of them need to consider other parts of the country possibly where they can work,” she said.

But the housing impact is increasingly difficult in many parts of Ontario.

Administrative assistant Andrea Smith, 31, and her partner bought a home in St. Thomas in October for $196,500, a fraction of the cost of the GTA. But St. Thomas is a seller’s market, according to a report from online realtor Zoocasa. Prices have shot up 6 per cent in the last year to an average of $323,000.

“We were lucky to get a house as cheap as we did. Every house was being bid up,” said Smith, who has a side job and hopes to sell her romantic fiction one day.

She says she doesn’t worry much about retirement, figuring they will be able to move up in the housing market and possibly rent their existing home for income.

“If you make money off downsizing, you can put that in your retirement plan. I know once you’re retired you tend to spend less,” she said.