Canadian seniors are wealthier than ever. Do seniors' discounts still make sense?

Cost of Living9:09Is it time to retire the seniors' discount?

Whether she's attending a chamber performance or playing in one, cellist and teacher Laura Backstrom says one thing is pretty consistent — the audience "looks like a sea of white hair," she says.

In contemplating why that is, Backstrom, 60, said she initially thought it was because seniors have "a need for music in their life and they have the time for it and they have the resources." 

But lately, her thinking has changed, she told Cost of Living. Now she wonders if audience demographics could have something to do with who gets a discount and who pays full freight.

While seniors enjoy healthy discounts on many event and entertainment tickets, those deals aren't extended to all potential attendees, she said. "There are people who maybe have a couple of kids and they find that getting a babysitter and paying for that just puts it over the top and out of reach for them." 

While few would suggest any older person should struggle financially, the higher incidence of poverty in younger groups has some Canadians wondering whether seniors should be the group to enjoy the most discounts on everything from bus fare to entertainment.

There are valid concerns about seniors living in poverty but statistics show that cohort is not the hardest up in Canada. Six per cent of Canadians aged 65 and older are classed as low-income, compared to 11.1 per cent of all other adults, according to the most recent Statistics Canada data.

The data, from 2022, also shows that single people in their senior years are four times more likely to experience poverty than seniors who live with a partner or family.

But even among that more vulnerable group of single seniors, of which many are women, only about 14 per cent live in poverty compared to 31 per cent of single people in every other age group, Statistics Canada says.

Backstrom qualifies for a discount at her local recreation centre in Victoria, and she thinks that may be misguided, too. "For a three-month pass, a senior is $95, an adult is $120. That's quite a big difference. With mortgage payments being super high for a lot of young families, that might just really put it out of reach."

The history of senior discounts

The demographics of Canada's poorest have changed considerably since senior discounts became common starting in the 1960s, said Harry Kitchen, a professor emeritus of economics from Trent University who has studied these discounts.

"At that time, a lot of retired people were very poor. A lot of them had worked in jobs where there wasn't a pension income or not a very good pension income, and they hadn't saved," said Kitchen. "When they retired, they really didn't have much income to live on."

The first Canada Pension Plan pensions started on Jan. 1, 1967, but full pensions weren't available until 1976. Guaranteed Income Supplement payments started in 1967. 

The proportion of poor people in the over-65 group is smaller than any other age group.- Harry Kitchen, economist

The 2021 census showed that poverty dropped "fairly dramatically" across all age groups since the 2016 census, said Kitchen, who lives in Peterborough, Ont.

But the breakdown of who is and isn't poor continued a trend that had already been present for years, with high incidences of poverty among people 25 to 55. That group encompasses a lot of single-parent families or people working two or three jobs to make ends meet, he said.

"The proportion of poor people in the over-65 group is smaller than any other age group," he added.

That said, some people say one of the tools Canada uses to measure poverty — the market basket measure (MBM) — isn't accurate for seniors because it doesn't capture health-related expenses such as prescription drugs or hearing aids.

The latest census data don't reflect the affordability crisis that mounted when inflation spiked to a 40-year high in June 2022 and collided with the housing shortage. In December 2023, the Bank of Canada said housing affordability was the worst it had been since 1982.

Discounts for parents?

Lisa Evans, a single parent with two young children, said she doesn't want to see seniors' discounts eliminated. But she wishes parents could be offered a discount, too.

"I think the reality now is some seniors are in a better financial position than the younger people are," said Evans, a marketing communications specialist who lives in Dundas, Ont. "Certainly parents are struggling more with the cost-of-living increases. We're seeing that wages aren't keeping up with the cost of living, that housing is completely out of control."

Evans said she and her late father used to discuss how things had changed since he bought their Toronto house for $60,000 in 1979. He earned $20,000 a year.

"Interest rates were insane at that time, granted. But that house was three times his salary," she said.

"That house is now worth $1 million." 

For a household earning about $100,000 a year, that two-bedroom bungalow costs 10 times their annual income, she said. The mortgage would be especially tough for parents of young children who are also juggling the costs of daycare or summer camps, she said. 

A sky-high mortgage isn't something most seniors have to worry about. Statistics Canada says nearly 69 per cent of people 75 and over own their homes, with most of those presumably purchased decades earlier.  

Evans has occasionally dipped into seniors' day discounts by getting her mom to pick up diapers or other pricey essentials. If there was a parents' day at Shoppers Drug Mart, "I would definitely plug those dates into my calendar and run over and grab the things that I need."

She said it would also be helpful to get the same discounted entry received by a senior when she takes her kids strawberry-picking or to the zoo.

"Spending $100 to go to African Lion Safari or a place like that, it's just out of the budget," she said. Some places offer a family admission but the math is based on two adults and two kids, which doesn't help a single-parent like Evans.

'Perks of being an old gal'

For Diane Bracuk of Toronto, getting 20 per cent off at Shoppers is "one of the perks of being an old gal." 

Bracuk said the retailer is where many seniors go for medically related purchases.

Even though she has kept fit, getting older has meant "the aches and pains come in, you get arthritis and you have to pay for this stuff," she said. "Advil super strength is expensive. Tylenol is expensive."

While she's there on Thursdays, she also buys the L'Oreal hair dye she feels she needs as a woman over 60 who is still in the workforce.

Seniors on a fixed income can't "spend the way [they] used to," she added. 

Steven Shechter, a professor at the Sauder School of Business at the University of British Columbia, said removing senior discounts would be a rough ride for businesses, regardless of whether they still make sense.

"If your competitors and you have been offering this for a while, I'd be very cautious about removing it," said Schechter, noting the fallout that could result from powerful seniors' advocacy groups.

Retail industry consultant Doug Stephens said that even though you can't "paint a whole generation with the same brush" most of today's seniors are in a better economic situation than their parents or grandparents were at the same age. 

"And yet these discounts persist," he said.

"One could make a pretty cogent argument that the discounts currently going to seniors ought to be going to young people to give them, you know, a better head start in life and maybe just a fighting chance at paying their bills."

Shane Coutinho is a 34-year-old public service employee who has moved back to his parents' home in Unionville, Ont., while he saves money toward buying his own place. 

He said he doesn't fault seniors for taking advantage of what's offered to them. At the same time, he wonders if there's a way for those better prices to be available for all ages, especially given big grocery and pharmacy chains have been posting record profits. 

"It would go a long way."