It used to be the norm: work hard, pay off your mortgage, and sail into retirement without a monthly payment hanging over your head. But for a growing number of Canadians approaching retirement, that idea is becoming more myth than milestone.
According to a recent Royal LePage report, nearly a third of Canadians expecting to retire in the next two years believe they’ll still be paying down their mortgages after they leave the workforce. That’s not just a financial detail — it’s a reflection of how drastically the retirement landscape has shifted.
The survey of over 1,600 Canadians reveals a sobering reality. Only 45 per cent of those nearing retirement have fully paid off their mortgages. Even more startling, just six per cent expect to eliminate their mortgage before they retire. A significant portion — 18 per cent — don’t even own their primary residence, and many others are unsure whether they’ll ever pay off their home in full.
This is a major departure from what previous generations experienced. Our parents and grandparents typically entered retirement mortgage-free, thanks to lower home prices, more predictable incomes, and in many cases, pension plans that carried them comfortably through their later years. Today’s retirees? They’re navigating an entirely different financial terrain — one defined by soaring housing prices, later homeownership, and heavier financial responsibilities.
Phil Soper, CEO of Royal LePage, puts it plainly: this generation is carrying mortgage balances that would have been unimaginable to older generations. Part of the strain comes from helping their children get into the housing market — the so-called “bank of mom and dad” has been generous, but not without consequences. Many pre-retirees have stretched their own finances thin trying to support their kids’ homeownership dreams, all while carrying their own sizable debts.
Still, it’s not all doom and gloom. Soper points out that many older Canadians are adapting. Retirement today doesn’t always mean the end of income — some rely on investments, others continue part-time work, and many have spouses who are still employed. While not ideal, it’s manageable — at least for now.
But this shift also changes how we think about retirement lifestyle. Take downsizing, for instance. It’s often seen as a logical move to cut costs and simplify life. Yet, according to the report, nearly half of soon-to-be retirees don’t plan to downsize within two years of leaving work. Personal attachments, lifestyle preferences, and economic factors — including falling condo prices in some major markets — all play a role in that decision.
Condominiums remain the most popular downsizing option, with 43 per cent leaning that way. A quarter prefer senior living communities, while the rest are split between detached homes, attached homes, or still deciding. In places like the Greater Toronto Area, where condo prices are projected to drop 15–20 per cent by year-end, some may see an opportunity. But even that silver lining comes with uncertainty in a volatile market.
So where does that leave us?
It leaves us with a generation that’s redefining retirement. Mortgage-free living is no longer a given — it’s a luxury. Canadians entering retirement today are doing so with more debt, more financial complexity, and more flexibility than any generation before them. The traditional idea of retirement as a time of complete financial freedom is fading, replaced by a more nuanced — and realistic — understanding of what it means to age in today’s economy.
And maybe that’s not such a bad thing. Maybe retirement, like everything else, needs a rebrand — not as an escape from financial responsibility, but as a new chapter that balances freedom with flexibility, comfort with compromise. It’s not the retirement many dreamed of, but it’s the one more Canadians are learning to navigate.
