Author: Christy Bieber

Renee Williams was very much alive and living in West Philadelphia when she discovered a serious problem. Her bank accounts, health insurance and retirement benefits had all been cut off.

The reason? She’d been placed in the "Death Master File" maintained by the Social Security Administration.

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Williams has spent more than six months trying to ensure everything is restored and lives in fear she’ll lose it all again due to a clerical error.

"I go to sleep at night and think about if they’re going to cut me off again, not knowing day-to-day what’s going to happen to my benefits," Williams told CBS News Philadelphia.

It’s a reasonable concern. Her benefit payments are still inconsistent, credit and banking issues remain and the whole experience has been “a pain in the behind.” Worse still, she’s not the only American in this situation.

Sadly, such problems may only get worse as the Trump administration culls government jobs and overhauls agencies — with the Social Security Administration (SSA) a top target.

In April, an estimated 2,500 SSA workers accepted buyouts as part of the government’s efforts to eliminate 7,000 jobs in the agency, AARP reports.

How many Americans are wrongfully declared dead?

According to the Social Security Administration, less than 1% of the three million deaths the SSA records annually are incorrect. That works out to about 10,000 people a year whom the SSA deems dead, but who are actually alive. That’s not good.

But Elon Musk has inadvertently made the problem worse. Ironically, that’s because he’s more concerned about benefits going out to people who are dead, claiming rampant fraud.

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That’s one reason he overhauled the Social Security Administration database as part of the Department of Government Efficiency DOGE — to eliminate such errors.

Unfortunately, as the Daily Beast reports, that overhaul is now cutting off benefits to a growing number of people who, like Williams, are alive and well but who are declared dead.

According to ABC News, experts believe Musk may have misread the records by reading the wrong databases.

Rennie Glasgow, a Social Security claims technical analyst who has worked in the Social Security Administration’s Schenectady field office for 15 years, told the Daily Beast that 4 million people have been marked dead on the database as a result of the DOGE overhaul — even though many are alive.

“We have people who did not receive benefits come in every day with their ID and say, ‘I’m not dead, I’m alive!’” he said, noting it can take three to four days to “resurrect” them.

"When they mark someone dead on the Social Security record, it stops their life,” Glasgow said. “It stops their car payments, it stops their credit, it stops their ability to do anything.

Class-action lawsuit in the works

One Philadelphia consumer protection attorney, Jim Francis, is helping these victims fight back.

"These are all people who are going about their normal lives, and all of the sudden, they lose access to all of their benefits, their pension, their medical insurance and they become financially paralyzed," Jim Francis told CBS News.

Francis is representing a Baltimore family that is trying to initiate a class action against Social Security after their relative, Joyce Evans, was improperly reported dead in 2023.

The family claims the mistake caused financial and health problems, leading Joyce Evans to actually die months after the error occurred.

"It’s a really serious problem and in the world of data being misreported, this is almost as bad as it gets, if not the worst,” Francis said.

What to do if you’re wrongfully declared dead

If you have been improperly marked as being deceased, make an appointment with your local Social Security Administration field office as soon as possible.

You’ll need to bring valid ID with you, which can include one of the following documents:

• Passport
• Driver’s license
• Employee ID
• Military record
• School ID
• Marriage, divorce or adoption record
• Health insurance card or medical record
• Life insurance policy
• Court order for name change
• Church membership

The original documents, or copies certified by the issuing agency, must be presented to the Social Security Administration. No photocopies are accepted.

Once Social Security corrects your record, they will provide an “Erroneous Death Case – Third Party Contact" Notice that you can show to banks, doctors and others to get your accounts back and your life restored.

Hopefully, field offices will be responsive in preparing this document, despite staff shortages and a growing number of the ‘undead’ fighting to restore their lives.

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Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

West Fargo resident Mary Pickarell was thrilled to get a text that appeared to be from Travis Kelce’s mother, Donna — known to cheer on her football star son alongside his superstar girlfriend, Taylor Swift.

The text said Pickarell had won a special Mother’s Day prize: a personal visit from Swift herself and a brand-new pickup truck courtesy of the pop sensation.

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As the local media outlet Valley News Live reports, Pickarell was told all she needed to do to arrange delivery of the pickup was pay a $100 fee via a Walmart gift card, which she promptly did.

Pickarell couldn’t believe her luck. Turns out she shouldn’t have believed it. Neither Swift nor the truck ever arrived.

“I went into tears,” Pickarell said. “No part of me thought it sounded off. I was just anxious to meet Taylor Swift in person.”

Celebrity scams are on the rise

Pickarell discovered she’d been the victim of a cruel scam after calling the Valley News Live team.

They advised her to contact the police. While Pickarell did just that, it was too late to get her $100 back — a concern given that she’s on disability with limited income.

“I want to let everyone know there are scammers out there and they will get older people,” Pickarell advised. “Don’t believe anything unless you talk to your family, friends, police, even the news.”

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Pickarell is one of countless people to lose money to an impersonator. According to the Federal Trade Commission, victims lost $2.95 billion to imposter scams in 2024.

Such scams take different forms, including criminals pretending to be from the government, family members in trouble or celebrities like Swift. The con artists use high-pressure tactics and may even manipulate people’s fear, demanding sensitive information or unusual payment methods — like gift cards, as Pickarall was asked to provide.

In recent years, the rise of AI has led to an increase in celebrity scams.

The AARP reports that criminals have gotten much more sophisticated than just sending fake texts like the one Pickarell received.

They’re now making convincing deep-fake videos appearing as someone famous to get people to part with their funds. Celebrity scam scenarios include:

Romance scams where victims are convinced they’re in a relationship with a celebrity who then begins to ask for money. Merchandise, investment or crypto scams that use fake celebrity endorsements. Fake prizes, like the Taylor Swift pickup truck scam that ensnared Pickarell.

One recent example of how AI has been used in this way involves a woman who paid $160K to a fake Keanu Reeves after she saw a video and, convinced it was the actor, fell for a romance scam.

In May, Michigan Attorney General Dana Nessel issued a warning about such scams.

"While it may be disappointing to hear, you are probably not in a secret, long-distance relationship with Garth Brooks,” she said. “If someone claiming to be Garth or any other famous figure is asking you personally for money, don’t send it. It’s almost certainly a scam.”

How to avoid falling for a fake-celebrity scam

The FTC advises searching for the celebrity’s name and the product or charity they appear to be endorsing online along with the word "scam.”

If you do fall for a scam and send money to a con artist, the FTC advises calling the police and the financial services firm or gift-card company you used for the transaction to report the fraud and request help recovering your funds.

When you report the incident to authorities, you can help with investigations that will help prevent others from being blinded — and blindsided — by star-power scams.

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• How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you’ll need a substantial stash of savings in retirement

Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

For many Canadians, retirement means freedom: The flexibility to hit the links whenever the sun shines, or even to take a road trip to visit parts of the country you’ve never seen.

But once you retire and start living off a fixed income, slowly drawing down your savings, you need to be careful about how you spend your money — especially if you’re still carrying a mortgage.

Of course, you’re far from alone in this. In August 2024, Equifax Canada’s Market Pulse Consumer Credit Trends and Insights Report found that consumer debt levels rose to $2.5 trillion in the second quarter of 2024; this is a 4.2% increase since the second quarter of 2023. Card holders carry over $4,300 in credit card balance on average, which is the highest level since 2007.

If you’re just carrying mortgage debt, you’re doing pretty well for your demographic. However, unexpected expensive purchases can take a toll on your budget.

Say you’ve been retired for two years since you packed it in at 65 and all those road trips to visit family have taken a toll on your current vehicle. It’s time to replace it. You’re willing to opt for used, but you’re still feeling a bit of sticker shock at what it costs to buy even secondhand these days.

If you’re now trying to decide if you should borrow for a car, though, you should be aware that you’ll be joining the ranks of retirees with non-mortgage debt. And you’re right to be nervous about doing that, as committing to making monthly payments while you’re on a fixed income can be tough, especially because you’ll have less money to spend going forward once you do that.

If you need transportation, you may feel like you have no choice — but before you move forward, there are a few things to think about first.

How to decide if you can afford a vehicle on a fixed income

The first thing you’re going to need to do is to make sure that your vehicle will be 100% affordable if you borrow for it. You do not want to increase your retirement account withdrawal rate above a safe withdrawal rate, which Morningstar analysts agree is 3.7%, although it used to be 4%.

If you can afford car payments while sticking to a safe withdrawal rate, either because you have wiggle room in your budget already or because you can cut back on non-essentials, then you can go forward with borrowing if you must.

You also can’t forget about the costs of maintenance and insurance, which you’ll want to ensure you can afford on your budget before moving forward. You can get insurance quotes before you buy to estimate these expenses.

Make sure you don’t borrow too much

If you do the math and the car payments, maintenance, and insurance costs seem reasonable, there are still a few caveats to consider.

First, experts recommend you aim to make a down payment of at least 10% if you’re buying a used car and 20% if you’re buying new. This will help you avoid ending up “underwater” or owing more than the car is worth.

If you don’t put money down, the car can depreciate or decline in value faster than your loan balance, and this creates big problems because you can’t easily sell the car or refinance if you need to. You would need to bring cash to the table to pay off your loan.

You also want to avoid taking a very long car loan, as this makes your debt payments last longer and increases your total interest costs, and you’ll want to make sure you understand the terms of your loan, including the total costs over time.

The Globe and Mail reported that the average monthly auto loan payment in 2023 was $880.

To avoid committing yourself to such a big payment, which could become less affordable as you incur more expenses due to the effects of aging, aim to limit your loan to the shortest term possible and the lowest amount possible — even if that means your car isn’t the fanciest.

Alternatives to a car loan in your 60s and 70s

If you find that a car loan is simply too expensive, or if you’re still concerned about how it will impact your finances, you should consider alternatives before moving forward with borrowing.

Looking for a cheap used car you can pay for in cash could be your best option — but remember, don’t take too much out of your retirement accounts and drain your balance. Instead, work on saving over time from your regular monthly income.

Leasing a car could come with cheaper monthly payments, but keep in mind you’re essentially renting a car and won’t end up owning it, and you’re restricted in how much you can drive the car and what changes you can make. You could also get stuck either paying a lot to buy the car at the end of the lease, or leasing for the rest of your life and having ongoing payments forever.

Another option is to secure a lower-interest rate personal loan that you can use to pay the cost of the car immediately, and then repay the loan at a more reasonable monthly cost over a period of a few years. To use this strategy it’s important to comparison shop personal loan rates. Consider using a rate consolidator — a company that aggregates loan offers from multiple lenders. By comparison shopping using a rate consolidator you can often find better loan rates on better terms that fit your consumer profile.

If you can’t pay cash for a car or find an affordable one within your budget, then buying a car simply may not be in the cards. Many older adults get discounts on public transportation, and some communities help them out with low-cost or no-cost rides to stores and medical appointments. While going without a car may seem like a pain, it’s a lot better than going without other necessities like food or medicine.

If you do decide to buy, be sure to shop for a car loan before you go to the dealer to see if you can get better rates and terms. Focus on affordability by taking the entire cost into account, not just the monthly payment, and don’t take out a long loan or a loan you don’t fully understand, because you could end up with serious regrets.

Sources

1. Equifax Canada: Economic Pressures Could Impact Credit Performance of Consumers, Especially Young Adults (Aug 27, 2024)

2. Morningstar: How Retirees Can Determine a Safe Withdrawal Rate in 2025 (Jan 7, 2025)

3. The Globe and Mail: High interest rates mean the new normal in vehicle buying is a monthly payment in the $1,000 range by Rob Carrick (July 14, 2023)

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

For 55 years, workers in and around Rancho Cucamonga, California, have reported to work at a local Frito-Lay factory — birthplace of Flamin’ Hot Cheetos and potato chips.

But now as KTLA reports, parent company PepsiCo is shutting down production there, displacing hundreds of Frito-Lay employees.

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Some teams will remain, including those who work in warehousing, distribution and transportation teams.

"We are truly grateful for all the support over the last five decades from our Rancho Cucamonga manufacturing team as well as the local community," a company statement read.

Many long-time employees who have been laid off will receive 10 weeks’ severance pay along with transitionary health benefits.

Here’s why the factory is closing down, along with some tips on how laid-off workers can remain on firm financial footing

PepsiCo is closing multiple facilities amidst financial struggles

While PepsiCo did not provide specific details as to why it was winding down Frito-Lay production at Rancho Cucamunga, shifting consumer demand has impacted the company’s bottom line.

As CNN reports, many Americans are cutting back on salty and savory snacks because of cost.

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In February, PepsiCo reported a 3% drop in fourth-quarter earnings from Frito-Lay brand snacks in North America.

In April, PepsiCo also lowered its 2025 earnings expectations in April, citing "elevated levels of volatility and uncertainty."

Meanwhile, it also shuttered a Frito-Lay production facility in Liberty, New York — affecting nearly 300 plant workers — and a Frito-Lay storage site in Aberdeen, Maryland, where 56 workersl lost their jobs.

What to do if you’re laid off

Try to negotiate a severance package. It isn’t always available, but it’s always worth asking for. Consider consulting with an employment lawyer to assist you with this, and to discuss other things you may want as part of such a package, including stock options, career transition support and health coverage.

Apply for unemployment benefits as soon as possible, and explore other financial assistance options. Keep in mind that any severance package you receive will affect your unemployment benefits and the point at which you receive them.

Investigate health-care coverage. Staying on your employer’s group health plan is an option thanks to federal law (COBRA), but you’ll have to pay the premiums once your employer stops doing so. This is an expensive proposition.

Alternatively, you may look at broader insurance options where you may qualify for a reduction on your monthly premiums or low-cost coverage through Medicaid or the Children’s Health Insurance Program

Work on your budget and cut costs wherever you can so you can search for a new job — including the time it takes to network and update your resume — without racking up a lot of debt.

Hopefully, the same creativity that led to Rancho Cucamunga workers to develop Flamin’ Hot Cheetos will help them identify new work opportunities as the economic landscape shifts.

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Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

If you’re in your early 60s, and have been working steadily for decades, you’ve probably had a target retirement date in mind for a long time.

Maybe it’s the traditional age 65; maybe your ambition is to pull the chute on your working life a little earlier than that.

Whatever the goal date is, you’ll inevitably start to feel the pressure once you’re within only a few short years of it.

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The last thing you want to do is give your notice at work knowing your finances haven’t been fully stress-tested for the long stretch of (hopefully happy and relaxing) years ahead of you.

To avoid that sinking feeling, here are five things you should do with your money ASAP.

1. Explore your health insurance options

First and foremost, you’ll have to tackle the health insurance issue.

Fidelity estimates that on average, a 65-year-old needs $165,000 in after-tax savings to cover health care expenses throughout retirement.

"Health care is creating a ‘retirement cost gap’ for many pre-retirees," said Steve Feinschreiber, senior vice president of the Financial Solutions Group at Fidelity. "Many people assume Medicare will cover all your health care costs in retirement, but it doesn’t. So you should carefully weigh all options."

If you retire at 65 or later, you can get Medicare immediately but should still look into Medigap and Advantage plans to reduce your out-of-pocket spending. If you aren’t yet 65 at the time you retire, you need a different plan for insurance coverage until you reach Medicare age as you can’t go without it.

One option is to use COBRA to stay on your employer’s plan for up to 18 months. Sadly, you’d get stuck with the full premiums without any employer subsidy, which makes this option costly. Signing up for individual coverage on the Obamacare marketplace is another option, but be aware the coverage often isn’t as great as that of the plans available through an employer.

Whatever you decide, you must know how much your insurance will cost, what it covers versus what you are responsible for, and where the money is going to come from to pay for all of this.

2. Get your cash flow right

Next, you must make a plan for how you’ll manage your money. This means considering income coming in and income going out to ensure you can live within your means.

Financial experts say you’ll need 80% of your pre-retirement income per year to maintain your lifestyle in retirement.

Income sources typically include Social Security, any pension that’s provided and/or money from savings. You’ll need to make sure this covers your spending needs and you outlive your savings. One popular rule of thumb says that if you take out 4% of your balanced portfolio in year one and adjust that amount for inflation in the following years, your nest egg will last 30 years.

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3. Maximize retirement account contributions

If you have just a few years or less to build your savings account balance, you should get serious about doing so.

Many Americans don’t have quite enough saved for retirement, and these last key years of work help you to bulk up your account balance — especially since you’re allowed to make extra tax-advantaged catch-up contributions to your 401(k) or IRA.

As you contribute to your account, don’t forget to make sure you also have the right asset allocation. You’ll need to draw from your funds soon so you can’t be too aggressive with your investments. One popular method for asset allocation is subtracting your age from 110 and putting that percentage of your portfolio in equities.

4. Decide when to take Social Security

Your Social Security retirement benefits are going to be a crucial income source, as unlike most money retirees get, these benefits are guaranteed not to run out and are automatically protected against inflation thanks to cost-of-living adjustments.

You can claim Social Security between 62 and 70, but you have a full retirement age (FRA) you must wait for if you want your standard benefit. If you were born in 1960 or later, your FRA is 67.

If you claim at 62, your benefits are reduced by as much as 30%. If you delay until after your FRA, then you get delayed retirement credits for each year until 70. If you wait until 70 to claim and maximize your credits this way, you will get 24% more in benefits than if you had claimed at your FRA.

Studies have shown claiming later provides more lifetime gains. You’re typically financially better off getting fewer checks but bigger ones once you eventually claim them. However, this won’t be the right choice for everyone since there are other factors to consider, so think carefully and research the implications of your decision.

5. Pay off high-interest debt

Finally, if you have any high-interest debt, you should aim to pay it off before leaving work. Covering interest costs only gets harder on a fixed income, especially with the average credit card interest rate coming in at 21.47% as of November 2024.

If you can get serious about repaying what you owe, then you can enter retirement with a clean slate and free up the money you’d have sent your creditors to do other things.

By taking these steps, you can get yourself in the best financial position so when the time comes to enjoy life with no job holding you back, you’ll have the funds to do it.

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• How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you’ll need a substantial stash of savings in retirement

Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

Imagine working day-in day-out, dutifully contributing money to a 401(k) for years — and then losing track of the money when you leave your job. Mortifying, but also extremely common.

In fact, in 2023, Capitalize estimated 29.2 million 401(k) accounts were lost or forgotten across America, containing $1.65 trillion in assets.

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Some people who forget old 401(k) accounts never remember they exist. But what if you do remember the account — but you can’t remember which plan administrator holds the funds, and the company you used to work for won’t help you?

Your money, your rights

Contributions you personally make to your 401(k) are 100% vested. This means the money you put into the account and any growth from investments is yours to keep right away. So, your company can’t withhold your old account from you, even if none of the company’s contributions are vested yet.

You should be persistent in contacting them to find out where the account is. Start by reaching out to HR, but if that doesn’t work, contact your former manager or even the CEO to get answers. Be polite but firm and insist they provide you with information about your old plan.

Plan sponsors are “obligated” to stay connected with former ex-employee participants, according to the Society for Human Resource Management.

But if the company is no longer operational, or if the people working there now can’t or won’t answer, then you have other options, including:

• Reaching out to old coworkers to see if they know who your plan administrator was
• Searching through old emails or financial records for statements or account notifications, as most plans send these quarterly or annually
• Reviewing your old pay stubs for information about 401(k) deductions

If none of these efforts work, online databases can help you track down the account. For example, while not all companies participate, some businesses register unclaimed 401(k) plans with The National Registry of Unclaimed Retirement Benefits. You can input your Social Security number into the registry to see if your company has your 401(k) listed.

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Alternatively, if your company terminated your old plan, or is in the process of doing so, then you may be able to find it in the Department of Labor’s abandoned plan database. Some private sites like Beagle or Capitalize can also try to help you.

Keep trying these options until you ultimately identify where your 401(k) plan is. Then, contact the plan administrators to confirm they are holding the account and make a plan for what to do with the money.

How to avoid losing your old 401(k)

As you can see, tracking down an old 401(k) can be a hassle. Thankfully, you have better options than just leaving your 401(k) behind when you leave a job.

One solution is to roll the money over into your new company’s 401(k). The biggest benefit of this option is that you can keep all your workplace retirement money in one place. Doing that can make it easier to ensure you have the right mix of assets since you can easily see your overall allocation within one account.

However, you also have another option, which many people prefer. You can roll the money into a traditional IRA.

You’ll need to either do a direct rollover so the money moves right from your 401(k) to your IRA, or if your 401(k) company sends the money right to you, you will need to deposit it into the IRA within 60 days to avoid early withdrawal penalties. If you do that, there are no tax consequences to the move.

Moving your money into an IRA gives you more freedom and flexibility since you can pick your brokerage firm and can choose a broker that allows you to invest in almost anything you want. You also won’t have to keep moving 401(k) money around every time you leave a job, since all the funds you rolled over can just stay in the IRA.

Whichever account you decide to roll the money into, if you move it with you, then you won’t have to worry about trying to contact old employers to find out where your funds are. You’ll have the money safe and accessible to you to help you build the secure retirement you deserve.

What to read next

• Financial aid only funds about 27% of US college expenses — but savvy parents are using this 3-minute move to cover 100% of those costs
• Here are the 6 levels of wealth for retirement-age Americans — are you near the top or bottom of the pyramid?
• Here are 5 ‘must have’ items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you?
• How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you’ll need a substantial stash of savings in retirement

Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

Ready-made housing is not a new phenomenon, but a Bay Area resident caused excitement in his Samara neighborhood in May when his new Accessory Dwelling Unit (ADU) arrived on a flatbed truck, and was installed via crane in only eight minutes.

The proud new ADU owner, who identified himself as Owen, spoke to CBS affiliate KPIX about the process, as a crane lifted the ADU over his house to gently place it in his backyard.

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Delivered within six months of Owen’s ordering it, the house arrived fully finished on the back of a semi-trailer truck with nothing to do but place it on its foundation.

Neighbors came out to watch, taking pictures and video as the crane swung the house over his existing home and onto its waiting foundation.

Owen said they described it as "one of the most exciting things that’s happened on the street."

While a spectacle like this isn’t something you see every day, ADUs are increasingly popular. Not everyone is happy about it.

A fast, affordable way to add an extra home

ADUs are simple, small housing units located behind or in the yard of pre-existing homes. They’re usually 400 to 1,200 square feet. A pre-fabricated ADU can be a faster and more affordable solution than building a home onsite from scratch.

Read more: You don’t have to be a millionaire to gain access to this $1B private real estate fund. In fact, you can get started with as little as $10 — here’s how

Owen paid $300,000 for his one-bedroom, one-bath unit, including $170,000 for the unit itself plus transportation and installation costs. Now he has a place for his parents and in-laws to stay when they visit.

"They like to come visit and stay with us for a couple of months every once in a while to spend more time with their grandkids,” he said. “We thought having this dedicated space that’s detached from the main house would make everyone more comfortable."

ADUs can also be used as home offices or rented out as income properties if zoning allows.

Critics say the units detract from neighborhood character, reduce available parking, depress property values and strain neighborhood amenities. And it’s not always as smooth a process as Owen experiencied.

More states are allowing ADUs

Jeremy Pearman, a spokesman for Samara, the company that built Owen’s home, said they were able to get a permit for the ADU submitted and issued in seven days thanks to California’s streamlined ADU approval process..

As HousingWire explained, California is among a number of states fast-tracking ADU approvals, along with Colorado, Ohio, Arizona, Massachusetts and Hawaii.

Governments are greenlighting ADUs in response to the nationwide need for affordable housing and buyers’ demand for smaller homes “closer to where the urban action is."

Some states are ending a ban on owner/occupancy requirements, allowing ADUs to be sold separately from main residences. This makes it easier to build ADUs on multi-family properties.

They’re requiring utilities to post connection information for services for ADUs, and require cities to develop programs to streamline ADU approval.

Is an ADU right for you?

If you are considering an ADU, it’s important to think about the big picture to ensure this type of housing unit is right for you. The Colorado architecture firm F9 has some helpful guidelines.

Before starting construction, make sure you understand:

Zoning and permitting requirements. You may want to talk to a local architect that understands ADU regulations. You will want to contact your local planning department about the project to see what’s entailed in terms of zoning.

Design and layout considerations. In a smaller dwelling, every inch counts. Whether it’s going to be used for family, as a home office or as a rental income property, make sure you get an ADU that’s a good fit for your needs. Designing a multi-generational, accessible space is a good way to future-proof your purchase.

Time and cost involved to get hooked up to utilities. Find out whether your existing home can supply a secondary unit with electricity, heating and air conditioning and indoor plumbing or if you’ll need separate services.

Local rules on renting out the ADU. Not all jurisdictions will allow this.

Budget and cost. An ADU can cost anywhere from $300-$800 per square foot. Make sure you budget accordingly and put away at least another 20% to account for overages and challenges in the construction process. Also consider how an ADU will affect your property taxes and insurance in the long term.

Lastly, if you plan to install a portable ADU like Owen that’s going to be craned in, don’t forget to alert your neighbors so they can come out and watch the show as it’s being delivered.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

Saving for retirement throughout your career is important, but it doesn’t always happen for everyone — especially if you’ve been through some challenges in your life, like a divorce.

If you’re 57 and working full-time making $170K, you’re earning more than most people in your position. According to Statistics Canada the median annual income was roughly $41,100 for women ages 55 to 64, in 2002. That’s the good news.

The not-so-good news is that only $60K in a Registered Retirement Savings Plan (RRSP), means you’re behind on retirement savings. Most savers would have have about seven times their annual income in savings, at this point, according to Fidelity. For you, that would mean a nest egg of approximately $1.19 million.

Given your circumstances, however, it’s not surprising that you’re falling short in your retirement saving goals. If you have three kids (two of whom plan to live with you) and you help your mom out, plus the other bills you’re paying down monthly, this puts you in a tough position, financially.

If you’ve found yourself in a similar situation, there’s hope. You can catch up on your retirement savings if you’re willing to make a few financial adjustments.

Do the math on tapping into your home equity

If you’re fortunate, you may own your own home and, in a major city like Toronto or Vancouver, chances are the home is worth $1 million or more. In the current market, it’ possible that your still paying down a mortgage. Let’s assume the remaining mortgage is $600,000 mortgage at 3.25%, and your home is worth $1.5 million. While the debt may feel overwhelming, the good news is you own a pretty valuable asset that could potentially help you boost your savings.

However, it all depends on just how much you can downsize given your family’s needs.

The first big thing to decide is whether or not you can immediately downsize your house.

If you could sell a $1.5 million home and use the proceeds to pay off a $600K mortgage, you’d end up with around $900K not including fees and expenses.

Now, you probably don’t want to invest that entire amount, although doing so could go a long way toward getting you caught up. That’s because mortgage rates are much higher now compared to the 3.25% that you’re currently paying.

If you invested the proceeds from your home and borrowed to buy another property, you may not drop your payment much at all. However, you could pay cash for a home, as the average Canadian home value, as of January 2025, is $670,064 according to WOWA. If you bought a home of this value, you could invest around $200K once you account for transaction fees.

Having $260K invested at 57 puts you in a much better place. In the best case scenario, your investments could grow 10% annually on average over the next 10 years, leaving you with $553,220.78 to live on — even if you never contributed another dollar.

At a safe 3.7% withdrawal rate, that would produce around $53,742 to live on each year.

While downsizing your home may not be something you want to do, it could be the simplest and fastest way to get out of your retirement troubles.

Maximize contributions to your retirement plans

Maxing out your contributions to retirement plans could also help you get back on track, especially if you feel you can’t sell the house due to your family’s needs.

At a $170K annual income, you may be able to contribute the max to your RRSP if you watch your budget carefully. That’s $32,490 in 2025 and an additional $2,000 without penalty.

If you invest that much every year for the next decade, on top of the $60K you’re starting with, you could have $924,900 by the time you hit retirement age.

While that’s not much more than if you sold your home, it would still provide around $25,900 in retirement funds to supplement your RRSP. You’d have to cut spending and probably downsize your home anyway at this point to afford to live on that income, but you may be able to make it work.

Delay your retirement start date

Delaying retirement is another option to help you catch up and it could benefit you in a few different ways.

If you waited until 70 to retire, you could have an extra three years to invest and grow your wealth. You could also qualify for delayed retirement credits that increase your Canada Pension Plan checks by $315 per month, to $1775, compared to your standard benefit and could rely on your savings for less time.

Ultimately, you’ll have to decide if you want to cash in on home equity, aggressively invest in your RRSP, delay retirement or choose some combination of all three techniques. The good news is that you do have options and your retirement isn’t doomed — you just need to decide on a path forward.

Speaking with a financial advisor could ultimately be your best bet in making this choice, as your advisor could help you determine which approach makes the most sense given your income, family needs and retirement goals.

Sources

1. Statistics Canada: Income of individuals by age group, sex and income source, Canada, provinces and selected census metropolitan areas (Apr 26, 2024)

2. Fidelity: How much do Canadians need to save per year for retirement?

3. WOWA: Canadian Housing Market Report

This article [I’m 57, divorced and make $170K/year, but only have $60K in an RRSP. I help my mom and kids financially, and don’t feel like I’ll ever be able to retire. Is there any hope?(https://money.ca/retirement/reaching-retirement-with-60k-in-rrsp-and-making-170k-yearly) originally appeared on Money.ca

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.