Which Investments Make Sense at Age 70? What to Know in Canada
At the age of 70, many people face the question of how to manage their assets safely and sensibly. This stage of life comes with specific priorities: security, accessibility, and a balanced approach between preserving capital and achieving modest returns. This article explores investment options that may be suitable for individuals in this age group in Canada and provides practical insights into managing wealth later in life. Investment strategies undergo significant transformation as Canadians enter their seventies. The financial landscape at this age demands careful consideration of risk tolerance, income requirements, and estate planning objectives. With potentially decades of retirement ahead, finding the right balance between safety and growth remains crucial for maintaining purchasing power against inflation.
Turning 70 in Canada usually brings a different kind of financial planning challenge. Instead of focusing on aggressive growth, most people start thinking more about steady income, protecting their savings, and making money last for the rest of their lives. The right investments depend on your health, family situation, tax position, and how much risk you are comfortable taking, but some guiding principles are common for many older adults.
Changing financial priorities at age 70
By age 70, retirement is often fully underway. Employment income may have stopped, and government programs such as Old Age Security (OAS) and the Canada Pension Plan (CPP) are usually already in pay. The main question becomes how to coordinate these income sources with withdrawals from RRSPs, RRIFs, TFSAs, and non-registered accounts.
Financial priorities often shift in three ways. First, capital preservation becomes more important than chasing high returns. Second, predictable cash flow matters more, especially to cover housing, healthcare, and day-to-day living expenses. Third, planning for longevity and potential care needs, including home care or assisted-living costs, becomes a key consideration when choosing investments.
What is the right investment approach at age 70?
There is no single right investment approach at age 70, but a few principles can help. Many Canadians in their seventies benefit from a diversified mix that leans toward lower volatility holdings, such as guaranteed products and high-quality bonds, while still keeping some exposure to growth assets like equities.
A common approach is to separate your money into “buckets.” Short-term needs (one to five years of expenses not covered by pensions) can be held in cash, high-interest savings accounts, and short-term guaranteed investment certificates (GICs). Medium-term money may sit in bond funds or laddered GICs. Longer-term funds, which may not be needed for ten years or more, can include dividend-paying stocks or low-cost equity exchange-traded funds (ETFs) to help offset inflation over time.
Investment options for older adults in Canada
Canadians in their seventies typically draw on several types of investments and accounts. Cash and high-interest savings accounts provide liquidity for emergencies and near-term spending. GICs and term deposits offer principal protection and a known rate of return if held to maturity, which many retirees value for peace of mind.
Bond funds and bond ETFs provide diversification across many issuers and maturities, though their market value can fluctuate when interest rates move. Some retirees also use conservative balanced funds that mix stocks and bonds in a single product. For those who prioritize guaranteed income, life annuities purchased from insurance companies can turn a lump sum into a regular payment for life. Meanwhile, tax-advantaged accounts such as RRIFs and TFSAs remain important vehicles for managing withdrawals and minimizing taxes.
Investments for retirees: prioritizing stability over returns
At age 70, protecting what you already have often matters more than seeking very high returns. This usually means limiting exposure to highly volatile assets, such as speculative stocks or concentrated positions in a single company or sector. Instead, retirees often focus on diversified portfolios with a larger share of stable income-producing investments.
A sample asset mix for some retirees might be, for example, 40–60 percent in fixed income (GICs, government and high-quality corporate bonds, conservative bond funds) and the remainder in diversified equities for growth potential. The appropriate mix depends heavily on individual circumstances, including other secure income sources, tolerance for market swings, and whether you plan to leave an inheritance. Regularly revisiting your allocation, perhaps every year or two, can keep the portfolio aligned with your changing needs.
Comparison of common investment options in Canada
Understanding the typical costs and returns of common investment choices can help older adults in Canada decide what fits their situation. Guaranteed products like GICs often show clearly posted interest rates, while market-based investments such as ETFs and mutual funds have management expense ratios (MERs) and fluctuating yields. Insurance products like annuities convert savings into income, but the amount you receive depends on interest rates and your age at purchase.
| Product/Service | Provider | Cost Estimation |
|---|---|---|
| High-interest savings account | EQ Bank | No monthly account fee; variable interest often in the range of about 2–3%/year |
| 1-year non-redeemable GIC | Royal Bank of Canada (RBC) | Posted promotional rates frequently around roughly 4–5%/year |
| Canadian aggregate bond ETF (ticker ZAG) | BMO | MER about 0.09% annually; yield changes with markets, often near 3–5%/year |
| Balanced mutual fund (RBC Select Balanced Fund) | RBC | MER typically around 1.8–2.0% annually; returns vary with market conditions |
| Life annuity for a 70-year-old | Sun Life Financial | Lifetime annual income often in a range near 5–7% of premium, depending on terms |
Prices, rates, or cost estimates mentioned in this article are based on the latest available information but may change over time. Independent research is advised before making financial decisions.
These figures are broad estimates meant only to illustrate typical ranges available in Canada. Actual rates depend on the provider, account type, investment amount, and timing. Before committing funds, it is important to check current posted rates, read product documents carefully, and consider how fees or penalties might affect your net return, especially for long-term holdings.
A retiree might, for instance, combine a high-interest savings account for immediate cash, a ladder of GICs to lock in rates over different terms, and a low-cost bond ETF for diversified fixed income exposure. Some may add a modest allocation to dividend-focused equity funds for growth potential, while others may prefer the certainty of an annuity for a portion of their savings to cover core living expenses.
As you weigh these choices at age 70, the main goal is usually to create a sustainable, understandable, and tax-aware income plan rather than to maximize returns at all costs. Considering your cash flow needs, risk tolerance, and family objectives can help you decide which mix of guaranteed and market-based investments makes sense for your situation in Canada.
