After decades of work,

retirement

is supposed to feel like freedom, and for many Canadians it did, until costs for groceries and essentials soared. What was once a comfortable retirement income in 2021 now does not go as far.

Many retirees are therefore reconsidering their financial plans, not due to poor decisions but because the economic landscape has changed and retirement can be expensive. Fortunately, there are practical ways to supplement your retirement income without sacrificing the lifestyle you have built.

The reality of a fixed income in a high-cost era

People tend to spend to the level of their income, whatever that income happens to be. When

costs rise faster than income

does, something must give. For retirees, that tension can feel especially stressful because the usual options, such as asking for a raise or picking up more hours, are not available.

During certain periods after the pandemic, investment returns were strong and some households benefited from rising real estate values. Some retirees were temporarily shielded from the rising cost of living expenses. But market volatility is real and a portfolio that looked healthy at retirement can look different a few years later, particularly for those drawing down their savings during a downturn.

Before exploring ways to bring in more income, it is worth taking a careful look at your current budget.

Tracking actual spending

for a month or two often reveals expenses that have quietly crept up or debt payments that consume significant portions of your income.

Trimming expenses will not solve everything, but it creates breathing room while you explore other options.

Revisiting when you draw CPP and OAS

If you retired early and have not yet started collecting

Canada Pension Plan

(CPP) or

Old Age Security

(OAS) benefits, the timing of when you begin drawing them deserves careful thought. You can choose to start receiving CPP as early as age 60 with reduced payments or delay receiving it to increase your monthly amount, up to age 70.

CPP also has a

child-rearing provision

that no matter when you begin receiving the CPP benefits, could increase the amount you receive each month. Apply for the child-rearing provision when you

apply for any CPP benefit

.

OAS follows a similar logic. Delaying OAS from age 65 to 70 increases the monthly payment by 36 per cent. If higher living costs are manageable in the short term through other means, waiting even a year or two to start these benefits can meaningfully improve long-term income. These are not decisions to make quickly or without guidance. A

Certified Financial Planner

(CFP) or financial adviser can calculate the break-even points based on your health, other income sources and tax situation. What works for one household may not work for another, so personalized advice is crucial.

Part-time work that fits your life

Returning to paid work is a straightforward way to top up retirement income and for many retirees it adds welcome structure and social connection. The key is to find work that matches your energy, schedule and interests, not just any paycheque. Also be sure that you are not taking on work because

family members are costing you

more than you can afford.

Contract and consulting work suit retirees with specialized expertise, as organizations often value experienced professionals for project-based work that does not require full-time hours. Knowledge gained in fields such as accounting, education, project management, health care or skilled trades remains valuable.

Seasonal and flexible retail or service jobs are another option, especially for those who enjoy interacting with people and want predictable hours. Many employers appreciate older workers for their reliability and customer-service skills.

If you are still collecting or planning to collect CPP, note that working while receiving CPP before age 70 means you can still contribute to the plan and earn

post-retirement benefits

that will modestly increase your future payments.

Turning a hobby or skill into income

Retirement often frees up time for creative or hands-on activities that were not possible during a busy career. Many retirees find their hobbies can also generate income.

Woodworking,

jewelry

making, photography, baking, sewing or gardening can lead to sales at local markets, online platforms such as Etsy or through community connections. Teaching skills such as music lessons, language tutoring or cooking classes offers another way to earn flexible, modest income.

The goal does not need to be a full

side business

. Even a few hundred dollars a month from something you already enjoy doing can meaningfully reduce financial pressure.

Generating income from your assets

If you own your home or have other assets, there may be opportunities to generate income without selling anything. Renting out a basement suite, a laneway home or even a spare room can provide a reliable monthly contribution to household income.

If your cottage or vacation property is unused for part of the year, renting it out seasonally can be a practical option. Short-term rental platforms make this easier but be sure to check rules, regulations and tax details first. Consulting an accountant is wise, and if renting is not a suitable option,

downsizing your home

may help reduce expenses.

Building a retirement budget that reflects today

Whether or not topping up income becomes part of your plan, regularly

updating your retirement budget

to reflect current expenses and income, including

irregular costs and debt payments

, will help you address any gaps as early as possible. For support with debt, you may want to seek support from a non-profit

credit counsellor

and for investment decisions, seek guidance from a qualified financial adviser.

Retirement is not a fixed destination. It is a phase of life that keeps evolving. Adapting your financial approach, even modestly, can make a meaningful difference in how comfortable the years ahead will feel.

Mary Castillo is a Saskatoon-based credit counsellor at Credit Counselling Society, a non-profit organization that has helped Canadians manage debt since 1996.

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