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One fact you will probably not hear is that 55 per cent of recent retirees have more disposable income in retirement than they had while they were working. This finding comes from a government-run micro-simulation model called LifePaths. Interestingly, the federal government pulled the plug on funding LifePaths about a year ago.

This is not to say that a CPP expansion might not make sense. I am actually in favour of it, if it is done right. One thing it will certainly do is to raise the under-savers (and yes, there are many of them) closer to the standard of living they enjoyed while working. The unanswered question is how much closer should they be without having to save on their own? As it is, the bottom 20 per cent of workers by income level do not need to save at all for retirement at 65. With an expansion of the CPP, it is likely that the next 20 per cent tranche of workers can also stop saving. Is this what we want? And, where do we draw the line?

Another reason to expand CPP is that our economic future looks a lot bleaker than the immediate past. As much as most of us are currently saving, it probably is not enough to compensate for the lower investment returns and longer life spans that are ahead of us. Of course, expanding the CPP does not solve the problem as much as it transfers the problem from individuals to government; and that may be a good thing.

A bigger CPP addresses various other real issues such as inefficient savings due to high retail investment fees and the risk of outliving one’s money. It also simplifies our retirement planning.