Canada's most educated, most affluent retirees are also the most likely to carry debt.
According to Statistics Canada data released on Wednesday, in 2009, 34 per cent of retirees aged 55 and older held mortgage or consumer debt. The median amount owed was $19,000.
Among indebted retirees, 25 per cent owed less than $5,000, 32 per cent owed between $5,000 and $24,999, and 26 per cent owed between $25,000 and $99,999. At the high end of the debt scale, 17 per cent owed $100,000 or more.
Those with a university degree had a median debt level of $20,000 compared to $13,000 for those who did not finish high school. And those with household income between $75,000-$400,000 were also the most likely to be carrying debt over $100,000.
"People who are already home owners, have high financial knowledge, higher income, are more likely to hold debt, but these same groups report high levels of financial security due to their income and net wealth," Katherine Marshall, a senior analyst at Statistics Canada and the study's author, said in an interview.
"They may be carrying debt but their debt in relation to their net wealth is quite a bit lower, and so they have a lot of backup, so to speak. They just feel more financially secure because of their higher than average income and their higher than average net worth."
Peter, a 47-year-old retired plumber from Campbell River, B.C., counts himself in that group. Although he has $142,000 in debt on a line of credit, he is using it for investment opportunities. Peter, who did not want his last name published, has three rental properties in Canada and two in Europe, from which he earns about $9,500 a month, before expenses.
Paying off the line of credit, which has a 2.75-per-cent interest rate, is not a priority, he said in an e-mail from London, where he was watching the royal wedding. "It helps with the cash flow on a monthly basis. In short, I'm not worried about it at all."
Not all retired Canadians are comfortable carrying debt, however. Asked how they would rank their financial situation, those with debt of any size gave a lower rating, Ms. Marshall said.
"Debt may be the proverbial financial albatross around the neck. Even when controlling for other factors, indebted retirees are less likely to give a positive review of their financial situation. And it may simply be that that outstanding balance, that monthly payment that must be made, is still enough to increase a sense of insecurity."
Among retirees with no debt, 9 in 10 reported they had no trouble keeping up with bills and other financial commitments, compared to 7 in 10 of those with debt.
The incidence and amount of debt declined with age. Among retirees age 75 and over, only 20 per cent had some form of debt and the median amount was $15,000, compared with 48 per cent of those age 55 to 64, who held a median debt of $20,000. Men of all ages carried a higher median debt ($22,000) than women ($15,000).
Of those over 55 and not yet retired, two-thirds carried debt, with a median value of $40,000.
"It may be one of the reasons they are still remaining in the work force," Ms. Marshall said.
A recent RBC poll found that in the past 12 months, there has been a significant rise in the number of retirees returning to the work force because they need the income (41 per cent in 2011 compared to 32 per cent in 2010), as well as a drop in the number of Canadians retiring debt-free (56 per cent in 2011; 61 per cent in 2010).