![\"Retired](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2026\/03\/6de0b12e4effca2f984a8d2c20c932d1.jpeg\")
Retired man looking pensive <\/p>\n Retired man looking pensive <\/p>\n
Taxes. Inflation. Health care. If you ask most retirees what keeps them up at night, you\u2019ll likely hear some combination of these three concerns. But there\u2019s a more subtle threat that rarely makes the list \u2014 and it might be costing more than all three combined.<\/p>\n
It\u2019s the fear of outliving your money.<\/p>\n
Losing a regular paycheque is a bigger psychological shift than most people expect. Without that predictable deposit every two weeks, even a well-funded retirement can start to feel shaky. And that feeling has consequences. According to a 2024 CPP Investments survey, 61% of Canadians say they\u2019re afraid of running out of money in retirement \u2014 more than half the population, including many seniors who have diligently saved for decades (1).<\/p>\n
The fear isn\u2019t irrational. But acting on it usually is. When retirees become afraid to spend their own money, it can become a hesitation that reduces their quality of life.<\/p>\n
Here\u2019s something most people don\u2019t expect to struggle with: Spending the money they spent 30-plus years saving.<\/p>\n
Research consistently shows that people with substantial savings can still feel seriously uncomfortable about accessing them. A common benchmark used by Canadian financial planners is the 4% rule \u2014 the idea that withdrawing 4% of your savings annually gives your portfolio a strong chance of lasting 30 years (2). Most people with a solid retirement plan should be able to spend at that level without worry. However, many don\u2019t come close.<\/p>\n
Part of what drives this isn\u2019t frugality \u2014 it\u2019s confusion. Numerous retirees remember the tax break they got for contributing to their Registered Retirement Savings Plans (RRSPs), but forget that withdrawals qualify as taxable income when taken out. That uncertainty makes people hesitant to touch the account at all, even when their financial plan says they should.<\/p>\n
What makes this especially tricky is that the government eventually forces the issue. Under Canada Revenue Agency (CRA) rules, your RRSP must be converted to a Registered Retirement Income Fund (RRIF) by December 31 of the year you turn 71 (3). After that, you\u2019re required to take minimum annual withdrawals based on your age and account balance \u2014 starting at roughly 5.28% at age 72. On a $500,000 RRIF, that\u2019s $26,400 out the door whether you \u201cfeel\u201d ready or not.<\/p>\n
Story Continues <\/p>\n
And yet, even with withdrawals built into the rules, some retirees treat every dollar they take out as a failure of discipline rather than the plan working exactly as intended.<\/p>\n
The cost is more than financial. For example, skipping the trip you\u2019ve been putting off for years, or not helping your children or grandchildren when it would actually make a difference. Saying no to the things that make retirement feel worth it \u2014 that\u2019s the real price of fear.<\/p>\n
Fear doesn\u2019t only make people spend less \u2014 it causes them to make unwise investments.<\/p>\n
When markets drop, the instinct is to move money somewhere safer \u2014 Guaranteed Income Certificates (GICs), cash, anything that feels stable. That instinct is understandable, but it\u2019s also expensive.<\/p>\n
A 2025 HOOPP survey reported that 44% of Canadians say their mental health has declined because of geopolitical instability \u2014 and retirees are especially vulnerable to letting that anxiety drive financial decisions (4).<\/p>\n
Markets bounce back faster than retiree confidence does. Long after portfolio values stabilize, many seniors are still too shaken to trust any visible recovery. And that pattern comes at a real cost. A retiree who moves their investments to cash during a downturn doesn\u2019t only miss the rebound \u2014 they often stay out of the market for months or years afterward, compounding the damage (5).<\/p>\n
The same logic applies to holding too much cash or overpaying for products that prioritize comfort over growth. Feeling safe and being financially secure aren\u2019t the same thing. Over a 20- or 30-year retirement, the gap between the two can be enormous.<\/p>\n
Read more: Here are 4 major investments worth making right now<\/a> to help your net worth skyrocket<\/p>\n The good news is, you don\u2019t have to white-knuckle your way through market volatility. Research from Melissa Knoll, vice president of behavioural science at Fidelity Investments Canada points to a simple solution \u2014 take the decision out of your hands (6).<\/p>\n Knoll\u2019s research shows that automated, rules-based investing is far more effective than relying on willpower during stressful periods. When contributions to your RRSP or Tax-Free Savings Account (TFSA) happen automatically, and your portfolio rebalances on a set schedule, you\u2019re far less likely to react and then regret.<\/p>\n The same principle applies to how often you check your accounts. Investors who constantly monitor their portfolios tend to be more risk-averse and more likely to make short-term moves that hurt their long-term returns. Checking in quarterly rather than daily is one of the simplest moves you can make toward protecting your retirement.<\/p>\n Also, consider what you\u2019re doing with the time you save. Every hour spent watching financial news or refreshing your brokerage app is an hour not spent on the life you saved up to enjoy.<\/p>\n Set a plan. Automate what you can. Review it periodically and let time do the rest. A diversified, rebalancing portfolio doesn\u2019t need to be babysat \u2014 and your retirement doesn\u2019t need to be spent anticipating the next crash. The money you saved is yours. It was always meant to be spent.<\/p>\n \u2014 with files from Melanie Huddart<\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines<\/a>.<\/p>\n CPP Investments (1<\/a>); Million Dollar Journey (2<\/a>); Goverment of Canada (3<\/a>); HOOPP (4<\/a>); Charles Schwab (5<\/a>); Fidelity (6<\/a>)<\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"Retired man looking pensive Taxes. Inflation. Health care. If you ask most retirees what keeps them up at…\n","protected":false},"author":2,"featured_media":499466,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[39],"tags":[28,9567,218029,147,530,1666,6476,724],"class_list":{"0":"post-499465","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-canadians","10":"tag-cpp-investments","11":"tag-personal-finance","12":"tag-personalfinance","13":"tag-retirement","14":"tag-retirement-plan","15":"tag-warren-buffett"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/499465","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=499465"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/499465\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/499466"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=499465"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=499465"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=499465"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}