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May 12, 2021

Boomers reluctantly adjust retirement plans

More than 50 percent of households are 'at risk' of being financially unprepared for retirement and the picture is even worse when accounting for health care, according to the most recent findings by the Center for Retirement Research at Boston College.

Forty percent of workers approaching retirement now expect to quit work later than they did before the market downturn, the CRR reports. Most of these intend to delay retirement by at least four years.

Many potential retirees are also cutting back on necessities, according to a recent survey by AARP. 17% said they are reducing medications. 8% have taken on a second job, while 19% have increased the number of hours they work.   

Discretionary expenses are also under scrutiny – 55% are postponing travel, while 68% are reducing spending on entertainment, AARP reports. In short, they're strapped and don't see things getting much better anytime soon.

That's why many budget conscious retirees are seeking alternative post-work nests in places like Mexico, according to a report by the International Community Foundation.

Almost half the U.S. retirees living in coastal areas are getting by comfortably on less than $1,000 a month, the ICF maintains, which is roughly half of what it would take across the border in neighbouring California. 

Affordability, quality of life, weather, and proximity to the United States were top reasons retirees chose Mexico, according to the foundation report.

Visiting a country on vacation isn't the same as retiring there, of course. A lot of Canadians who retire outside Canada full-time are surprised by the cultural isolation they experience. But it clearly works for some.

Do you feel that your retirement is in jeopardy? Would retiring in Mexico even be on your radar screen?

By Gordon Powers, MSN Money

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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

James HaversJames Havers

James is the senior editor of MSN Money living in Toronto. He has worked for the Nikkei Shimbun (Tokyo), canoe.ca, AOL.ca, Canadian Business and other publications. Havers turned to journalism after teaching overseas.

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...