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The Great-West Life Assurance Company, London Life Insurance Company and The Canada Life Assurance Company have become one company – The Canada Life Assurance Company. Discover the new Canada Life

The Great-West Life Assurance Company, London Life Insurance Company and The Canada Life Assurance Company have become one company – The Canada Life Assurance Company. Discover the new Canada Life

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Freedom 55 Financial is a division of The Canada Life Assurance Company and the information you requested can be found here.

How retirees spend their time

Key takeaways

  • Retirees spend their time doing a number of different things
  • There are important financial obligations to take care of before the end of year you turn 71
  • Retirement is a great time to focus on your health and wellness

At what age will you retire?

While 65 is the traditional age of retirement for many people, in reality, Canadians retire much earlier and much later.

Age 65 is often when people start receiving Canada Pension Plan (CPP)/Quebec Pension Plan (QPP) and Old Age Security (OAS) payments.

But along with the financial decisions about retirement, you need to decide how you’re going to spend your time once you’ve stopped working full time.

Retirement is a great time to focus on your health and wellness. Not going to work every day may be easier on your body. You’ll also have more free time to exercise or pick up an athletic hobby. Keeping active is always important and especially during your retirement years.

How retirees spend their time

As retired people age, the time they spend doing certain activities changes.

A day in the life of a retired Canadian

Average hours per day spent on each activity.

  • Doing unpaid household work
    • Age 55 to 64: 3.1¹
    • Age 65 to 74: 3.3
    • Age 75 and older: 3.2
  • Engaging in civic, religious and organizational activities
    • Age 55 to 64: 2.1
    • Age 65 to 74: 2.3
    • Age 75 and older: 1.8
  • Socializing and communicating
    • Age 55 to 64: 2.3
    • Age 65 to 74: 2.3
    • Age 75 and older: 2.2
  • Engaging in leisure and physical activities
    • Age 55 to 64: 2.3
    • Age 65 to 74: 2.2
    • Age 75 and older: 2.3
  • Using technology
    • Age 55 to 64: 1.7
    • Age 65 to 74: 2.0
    • Age 75 and older: 2.0
  • Watching television and videos
    • Age 55 to 64: 3.3¹
    • Age 65 to 74: 3.9
    • Age 75 and older: 4.3¹
  • Reading
    • Age 55 to 64: 1.5
    • Age 65 to 74: 3.9
    • Age 75 and older: 2.2
  • Sleeping
    • Age 55 to 64: 8.5¹
    • Age 65 to 74: 8.9
    • Age 75 and older: 9.3¹

What happens at age 71

You can keep contributing to your group RRSP until Dec. 31 of year you turn 71. If you have unused RRSP contribution room from previous years, you might consider using it up if you can.

If your spouse isn’t 71 years of age yet, you can also contribute to their RRSP if they have contribution room.

Before the end of the year you turn 71 you have to choose one of these 3 options for your RRSP:

Lump-sum withdrawal

You can withdraw all the money from your group RRSP. You’ll pay a withholding tax and the full amount will be included in your income which could result in you paying a large amount of tax.

Convert your group RRSP to a RRIF or LIF

Once you convert your RRSP | PDF 4.86MB to a registered retirement income fund (RRIF), you can start receiving payments from it. The CRA sets the minimum amount you must withdraw based on your age and a percentage of the market value of the RRIF. 

You’ll pay income tax on any money you receive from your RRIF but not pay a withholding tax. 

Available in all provinces except Prince Edward Island and Saskatchewan, life income funds (LIFs) allow you to transition locked-in savings plans (registered pension plans, locked-in RRSPs and locked-in retirement accounts (LIRAs) to income while deferring taxes. LIFs provide a flexible income that can last a lifetime. LIFs come with some rules. For example, you may need consent from your spouse to purchase a LIF. Unlike RRIFs, LIFs have both minimum and maximum annual withdrawal limits. 

Purchase an annuity

You can also convert your group RRSP to an annuity which can provide you with guaranteed income for a specific period of time or the rest of your life. 

You won’t pay a withholding tax and you may have to pay income tax on the money you receive from the annuity.

The RRSP withholding tax

This tax is withheld by your financial institutions when you take money out of your RRSP and passed to the CRA. The rate varies depending on how much you withdraw and the province where you live.

Enjoying the retirement experience 

Take time to determine what you want your retirement to be like. Retirement gives you the chance to emphasize the things in life you didn’t have time for during your working years. Life in retirement can, and should, be everything you want it to be.

What's next?

  • Now that you know more about how retirees spend their time, why not meet with your advisor for help managing your money.
  • If you’re a member of a Canada Life employer-sponsored savings plan, we have licensed professionals who can assist you. Contact Canada Life to learn more.

The information provided is based on current laws, regulations and other rules applicable to Canadian residents. It is accurate to the best of our knowledge as of the date of publication. Rules and their interpretation may change, affecting the accuracy of the information. The information provided is general in nature and should not be relied upon as a substitute for advice in any specific situation. For specific situations, advice should be obtained from the appropriate legal, accounting, tax or other professional advisors.

  • 1 Significantly different from reference category (ref.) (P<0.05), Source: Statistics Canada, General Social Survey, 2015.