TORONTO – According to predictions made by HomeEquity Bank in partnership with Ipsos, Canadians 55 plus will “throw out the traditional retirement playbook” and embrace new financial, technological and familial norms, that will have a ripple effect across younger generations.
From leaving a legacy to living one
According to a report shared by HomeEquity Bank and IPSOS (a Canadian market researcher), older Canadians are realizing their adult children will benefit most from financial help now, instead of years down the line with 53 per cent of Canadian homeowners aged 55 plus saying they have gifted a significant amount of money as a financial gift to their adult child or grandchild, with “living legacy” gifts taking the most popular form in education, weddings or a first home.
Fifty-five per cent of said “living legacy” gifts were valued at over $25,000 or more. The report also stated that 2024 saw a 16% increase in new reverse mortgage holders reporting using funds for gifting purposes.
Skip-gen bonding
The report also stated that more Canadians are planning “skip-gen bonding” experiences that see grandparents travel with younger relatives.
Younger generations benefit from these adventures through priceless quality time, family connection and new experiences that they would not have otherwise had.
According to HomeEquity Bank, since 2021, there has been an 86% increase in new reverse mortgage holders reporting using funds for travel purposes with Gen Z and Gen Alpha grandchildren with the trend expected to continue in 2025.
Embracing AgeTech at home
With prices predicted to decrease, HomeEquity Bank predicts a wider adoption of AgeTech – a wide range of technologies including wearable devices, smart home systems and even social robots for companionship – that will enable older Canadians to live independently and comfortably, while also providing tools for caregivers to better support their needs.
The report claims that the rise of AgeTech will keep families connected throughout their fitness journey, improve healthcare access and outcomes, and provide peace of mind for younger generations and caregivers who can safely monitor their loved ones while they remain independent.
“House rich” Canadians more comfortable with debt
According to Ipsos, the number of Canadians 55 plus who are considered “house rich, cash poor” (HRCP) has increased by 66 % since 2021 to 2.66 million, with more than half residing in Ontario.
To be considered HRCP one must have less than $50,000 in investable assets and own a home with at least $400,000 in equity.
And while their limited cash is buying less these days, they’re 10 percentage points more comfortable with debt than the rest of Canada. In 2024, half of new reverse mortgage holders reported using funds for living expenses.
The report predicts that 2025 will see more house rich Canadians explore financial solutions to access their savings in their home to fulfill life goals as they age.
Mortgage brokers to take centre stage
The report also stated that with a historic 1.2 million mortgages up for renewal in Canada in 2025, finding an experienced mortgage broker to provide trusted advice and secure the lowest rate possible will be a major priority for Canadians.
Brokers will help navigate delinquency risks and recommend solutions that won’t exacerbate household debt.
Canadians 55 plus renewing this year at higher rates may be faced with significantly larger monthly payments on a fixed income. Rather than renew at high rates, brokers will increasingly suggest reverse mortgages as an alternative. They will also be pivotal in helping first-time home buyers take advantage of forced sale opportunities to enter the market.