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Someone in their early sixties slides a statement across the kitchen table. Balanced portfolio. Broad index funds. Low annual fees. They did everything the industry told them to do, in the order the industry prescribed. Then they ask the question that has nothing to do with the statement: "Will it last?" I call that FORO. Fear Of Running Out. People tell me it's just nerves. It isn't.
Here's what I think is really happening.
An index fund is a very good machine for one job: growing money over thirty years. It assumes you have time. It assumes you're buying, not selling. It assumes you don't much care what's inside, as long as the number goes up.
Every one of those assumptions stops being true the day you retire.
Why do index funds treat expensive stocks as growth stocks? Campbell Harvey teaches finance at Duke University's Fuqua School of Business. This spring, he published a paper with four colleagues in the Financial Analysts Journal that tackles something so basic that most of us never think about it. (Source: Arnott, Brightman, Harvey, Nguyen & Shakernia, "Fundamental Growth," Financial Analysts Journal, 2026.) Almost every index fund is built on one idea: if a stock is expensive, the company must be growing rapidly.
Harvey's finding is that this is often wrong. A stock can be expensive because it's popular. But popularity and growth are two different things. If you want proof that price and business performance can go their separate ways, think back to 2021. GameStop. AMC. Stocks that shot up on Reddit forums, with very little of the chatter based on earnings reports.
Think back to 2021. GameStop. AMC. Share prices shot straight up because people online decided they should. Not because those companies were selling more of anything.
Now consider how index funds work across every retirement account. A stock becomes popular, its price rises, and the fund buys more of it, not because the business improved, but because the price went up.
How concentrated is the S&P/TSX Composite? Everything above is American. Here's the Canadian version, eh?
The main Canadian index is not a broad mix of the world's best businesses. It's dominated by banks, mining and oil. Those three groups make up close to 70% of the index. Banks alone account for about 31%. According to the iShares Core S&P/TSX Capped Composite, the ten biggest holdings are roughly 38% of the whole thing, with Royal Bank at the top. In fact, close to half the weight of the index is made up of just financials and energy.
I'm not saying anything negative about those companies. I'm saying you own them, whether you picked them or not, in amounts you didn't choose, for reasons that have nothing to do with what you need at age 72.
That's been a fine bet for long stretches. It's also a narrow one. And narrow feels very different at 65 than it did at 35, because at 65 you no longer have the thing that makes a bad market survivable.
Time.
Why does a market drop cost a 65-year-old more than a 35-year-old? Let’s illustrate this with an example. Two people own the same fund. One is 35 and still contributing, while the other is 65 and withdrawing. Both are dealing with $6,000 this year. A unit of the fund costs $100. Then the market drops 20%, and a unit costs $80.
The 35-year-old puts in $6,000. Before the drop, that money bought 60 units. Now it buys 75. Fifteen units he didn't pay for.
The 65-year-old needs $6,000 to live on. Before the drop, she'd have sold 60 units to get it. Now she must sell 75. Fifteen units she'll never get back.
Then the market recovers. Units return to $100. His 15 extra units are worth $1,500 more than he paid for them. Her 15 units were sold at the bottom. They aren't there to recover.
Same fund. Same market. Same $6,000. The only difference is the direction the money was moving. That's why a retiree needs to look inside the fund, whereas a 35-year-old mostly doesn't.
RRIF minimum withdrawals: why Canadian retirees are forced to sell In Canada, we've set a rule. When your RRSP becomes a RRIF, you must withdraw a minimum amount each year. The rate starts at 5.28% at age 71 and increases each year after that. (Source: Canada Revenue Agency, prescribed RRIF minimum withdrawal factors.)
So, a Canadian retiree can be forced to sell in a bad year, from a narrow index based on a definition of growth that a Duke University business professor has just called flawed.
Three problems stacked on top of each other. None of them show up on the statement.
This is exactly the point I made with EY Canada in The Canadian Retirement Evolution, published in July (Source: EY Canada, 2026). FORO isn't a personal failing. It's a design gap. We built a system to save money, then asked it to pay people reliably for thirty years. It was never built for that. And the biggest thing most Canadians over 55 own isn't in the index at all. It's the house. About 70% of the coming wealth transfer in this country sits in real estate, and more than 85% of seniors say they want to stay in their homes (Source: EY Canada, The Canadian Retirement Evolution, 2026). Asset-rich, cash-poor, and treating their largest asset as off-limits.
5 questions to ask your advisor about your index funds I'm not telling you to sell anything. I can't. I don't know your health, your pension, your taxes, or your nerves.
But here's what I'd want answered before my next meeting with an advisor.
What are the ten biggest things I actually own? Not the fund name. The holdings. Do my funds overlap? Three funds that all own the same five banks isn't three bets. It's one. What happens if I must withdraw in a bad year? Is my "growth" fund measuring actual growth, or just price? Where does my home equity fit into all this? Ask. A good advisor will be glad you did. If you get a pie chart and a pat on the back, ask again.
One last point from Professor Harvey. More than half of all invested money now sits in funds that buy automatically. He thinks it could reach 80% within ten years. (Source: Duke University Fuqua School of Business, 2026.)
When enough money buys without looking, price stops being a judgment and becomes a reflex.
But retirees are the least able to afford someone else's reflex.
Here's the plain truth beneath all the jargon: nobody swapped out your equipment when the game changed. You're still holding a golf club on a pickleball court. Momentum is still wearing a cardigan. Your funds still can't tell the difference between expensive and growing. And most retirement plans still hand you a seatbelt when what you need is a crash-proof suit.
Nobody in the industry is racing to fix this for you. So I will. Consider this the first chapter, not the last word.
It's time to take back our retirements and reset.
Don't Retire…ReWire!
Sue
My Book is Now Available for Pre-Order I hope you will consider pre-ordering a copy of Your Retirement Reset for you, a friend or loved one. It's available September 29, 2026 published by ECW Press - You can now order at Indigo or Amazon. And if you love supporting Canadian booksellers, please also check with your local independent bookstore. Most can easily order it for you.
References: All figures verified 4 August 2026 Important: This article is general information and commentary only and does not constitute financial, mortgage, tax, legal, or investment advice. Before making decisions about your retirement or home equity, consult qualified liscensed professionals who can assess your personal circumstances.
You've seen the photo. Silver-haired couple on a sailboat, or walking on a beach at golden hour, laughing about nothing in particular. It's on the cover of every retirement brochure ever printed. It's what "the average Canadian retiree" looks like.
In thirty years of banking, I never met that couple. I met a widow in her seventies deciding between a dental crown and her property taxes. I met a couple in their sixties quietly draining their RRSPs to keep a grandchild in university. And yes, I met people with sailboats, though they weren't asking me about retirement income. They were asking about estate freezes and charitable foundations.
Three conversations. Three completely different Canadians. And after three decades of having them, most recently as a vice president at one of Canada's Schedule I banks, I've come to believe our biggest retirement problem isn't that Canadians plan badly. It's that we keep designing for an "average retiree" who doesn't exist.
In The Canadian Retirement Evolution, a report newly published by EY that I was proud to co-author, I make the case for seeing Canadian retirees as three distinct groups.
1) Retirees in Need (roughly 30%) Nearly one-third of Canadian retirees are living close to the edge. Limited pension income, modest personal savings, and rising living costs define their retirement.
Adding to the pressure, retirement debt is becoming the new reality. According to Royal LePage, 29% of Canadians who are recently retired or approaching retirement expect to continue making mortgage payments on their primary residence. For many Canadians, debt has become a permanent companion, extending well into what should be their most financially secure years.
Perhaps the most troubling reality is this. Most people in this group have never received professional financial advice. The Canadians who need planning the most are often the Canadians the financial planning industry reaches the least. That should concern every financial institution, advisor and policymaker in this country.
When retirement arrives with too little income, too much debt and no plan, the result is not just financial stress. It is anxiety, reduced independence and difficult choices that no Canadian should have to make after a lifetime of work.
2) Retirees Seeking Stability (roughly 60%) This is the majority of Canadian retirees, and the group that the sailboat photo completely misses. They are not financially struggling, but neither are they financially free. They have enough to retire, but not enough to stop worrying.
What they want is simple. They want to maintain the lifestyle they spent forty years building. They want confidence that their money will last as long as they do. They want a retirement plan that offers stability and predictability. And they want the freedom to help the people they love, whether that's contributing to a grandchild's education, helping with a first home, or lending a hand when life throws one of their children an unexpected curveball.
That is where retirement becomes complicated. Retirement has changed dramatically over the past three decades, but much of the advice Canadians receive has not. The result is a growing gap between today's retirement realities and yesterday's retirement plans.
Every dollar shared with family is one less dollar available to fund their own future. Every unexpected expense raises the same unsettling question: Will I still have enough?
This group lives in the space between abundance and anxiety. They have assets, but not always confidence. They have choices, but every choice comes with trade-offs. They don't need a miracle. They need a plan that provides stability, predictability, and the confidence to enjoy the retirement they worked so hard to earn without constantly wondering if today's decisions will become tomorrow's regrets.
3) Affluent Retirees (roughly 10%) The remaining ten percent focuses on sophisticated wealth management: transferring wealth to the next generation, structuring estates to minimize taxes, and giving philanthropically. These are good problems to have, served by an entire industry built to solve them.
And that's the uncomfortable truth hiding in the framework: most of our retirement advice, most of our products, and most of our planning tools were designed with this group in mind.
Retirement Fear Has a Name In 1990, more than 70% of Canadian workplace pension plans were defined benefit plans, providing predictable, guaranteed lifetime income. By 2022, that figure had fallen to just 37%. In the span of a single working generation, we quietly shifted the risk of outliving retirement savings from institutions to individuals.
The anxiety created by that shift is something I encountered in thousands of conversations with Canadians throughout my lending career, long before I had a name for it. I call it FORO, the Fear of Running Out. In the EY report, we describe it this way:
"Fear of running out (FORO) reflects a structural gap in retirement system design, not a failure of individual planning. Most retirement frameworks were built for accumulation rather than sustainable income in later life." That is the heart of the challenge. Canada's retirement system does an excellent job of helping people save, but far less to help them transform those savings into sustainable, predictable income throughout retirement. It is little wonder that so many Canadians approach retirement with uncertainty rather than confidence.
The Elephant in the Living Room One final reality deserves far more attention. Canada is in the midst of one of the largest intergenerational wealth transfers in its history. Much of that wealth is tied up in residential real estate, owned by Canadians who consistently say they want to remain in their homes for as long as possible.
That creates an important contradiction. The largest asset held by most Canadian households is also one of the least integrated into mainstream retirement planning. We encourage Canadians to build home equity for decades, then often ignore it when they need income the most.
If retirement planning is meant to consider every available resource, why do we continue to overlook the largest one?
Resolving that question has become the focus of my research and my forthcoming book, Your Retirement Reset: How to Convert Home Equity into Financial Security (ECW Press, September 2026). But that discussion extends beyond the scope of this article.
For now, it is enough to recognize the disconnect. Retirement has changed. Canadians' balance sheets have changed. It may be time for retirement planning to change as well.
A Retirement System Designed for Everyone The EY report reminds us that retirement is more than a financial milestone. It is one of life's most significant transitions, and every Canadian deserves to approach it with confidence, dignity and choice.
That outcome will not be achieved with a retirement system designed around a single, hypothetical retiree. Canadians retire with different financial realities, different goals and different challenges. A retirement system that recognizes only one path will continue to leave too many people behind.
Designing for the three retirement realities outlined in this paper is not simply good policy. It is good business. Financial institutions that tailor products, advice and education to meet the needs of all three groups will be better positioned to serve Canada's fastest-growing demographic.
Policymakers who encourage that evolution will help create a retirement system that reflects the way Canadians actually live today, not the way they lived thirty years ago.
The question is no longer whether retirement has changed. It has. The question is whether our retirement system will evolve quickly enough to meet Canadians where they are.
Don't Retire... Re-Wire!
Sue
My Book is Now Available for Pre-Order I hope you will consider pre-ordering a copy of Your Retirement Reset for you, a friend or loved one. It's available September 29, 2026 published by ECW Press - You can now order at Indigo or Amazon. And if you love supporting Canadian booksellers, please also check with your local independent bookstore. Most can easily order it for you.
Former bank executive and Retire with Equity founder says "fear of running out" reflects a structural gap in retirement system design — not a failure of individual planning TORONTO, ON — July 23, 2026 — Susan Pimento, founder of Retire with Equity, is a co-author to The Canadian retirement evolution: Why financial institutions and policymakers must rethink retirement, a new report published today by EY examining how Canada's retirement landscape is changing — and why the systems built to support retirees are struggling to keep pace.
The report arrives amid a structural shift in how Canadians fund retirement: in 1990, over 70 percent of Canadian workplace pension plans were defined-benefit schemes providing predictable lifelong income; by 2022, that figure had fallen to 37 percent — shifting investment risk, and the fear of running out onto individuals.
Drawing on more than 30 years of senior leadership in Canadian banking and frontline lending, including serving as Vice President at a Schedule I bank, Pimento contributed a framework that groups Canadian retirees into three primary categories, each with distinct financial circumstances and priorities — a lens designed to help financial institutions and policymakers move beyond one-size-fits-all retirement planning. Sue Pimento is also the author of the forthcoming Your Retirement Reset: How to Convert Home Equity into Financial Security (ECW Press, to be released September 2026),
"Fear of running out — FORO — reflects a structural gap in retirement system design, not a failure of individual planning," said Pimento. "Most retirement frameworks were built for accumulation rather than sustainable income in later life. Canadians aren't failing their retirement plans. In many cases, the plans were never designed for the retirement they're actually living." Pimento's contribution reflects the research focus of Retire with Equity, which provides retirement intelligence to Canada's financial sector on its fastest-growing and wealthiest demographic: adults 55 and over. Her forthcoming book examines how home equity — the largest asset most Canadian households hold — can be strategically converted into retirement income, and argues it belongs in every retirement conversation and product roadmap.
"The industry has spent decades perfecting how Canadians save," Pimento added. "The next decade will be judged on how well we help them spend — sustainably, confidently, and without fear." The EY Report: "Canadian Retirement Evolution" is publicly available at:
https://www.ey.com/en_ca/insights/financial-services/canadas-retirement-evolution Media availability: Susan Pimento is available for interviews and commentary on:
retirement income design the three categories of Canadian retirees financial strategies for aging in place Intergenerational financial conversations about money (between seniors and their adult children) home equity strategies new ways for government and banks to serve the 55+ demographic About Susan Pimento Susan Pimento brings deep experience to the conversation on modern retirement strategies in Canada. With over 30 years of senior leadership in banking and frontline lending — including serving as Vice President at a Schedule I bank — she now advises financial institutions and policymakers on how to modernize retirement solutions and engage Canada's fastest-growing, wealthiest demographic: adults 55+. She is the founder of Retire with Equity and author of Your Retirement Reset: How to Convert Home Equity into Financial Security (ECW Press, September 2026).
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Media Contact: Susan Pimento Website: www.retirewithequity.ca Email: sue@retirewithequity.ca
