Gordon Powers

A lot of older workers assume their retirement benefits — medical, dental, drugs, life insurance — will be available to them for as long as they live.

But they're wrong.

According to a Watson Wyatt survey of 500 major Canadian employers, fewer than half of them now provide any medical coverage for their retirees.

And even if your employer currently says that it will look after you when you retire, there's no guarantee it won't break that promise a few years down the line.

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Not that long ago, both Bell Canada and Sears eliminated most supplemental benefits for retirees, joining a growing list of companies scrambling to cancel, scale back, or somehow cap their soaring retirement obligations.

Just last month, auto parts supplier Visteon Corp. slashed retiree health care benefits to 6,650 current and future retirees. In bankruptcy court, the company said its savings would total some $310 million.

The unkindest cut of all: Molson's recent decision to phase out its longstanding policy of providing free beer to retirees. Their allotment will now be a dozen bottles a month, down from a previous six dozen a month.

And this is only going to get worse. The cost to an employer providing life insurance alone for a 62-year-old employee is $2,000, according to research by Towers Perrin. Add healthcare insurance to age 65 and that obligation rises to $11,000. Tack on life and health insurance for life, and the cost soars to $40,000.

No wonder so many companies are trying to get out of the retirement business.

That's also why those that still do offer coverage often kick you out of the plan once you turn age 65. And why many of them will also drop you if you no longer reside in Canada.

Even though you'll still be covered by your provincial health plan for many items in retirement, this means you'll soon be facing a long list of items that you'll have to cover on your own.

These include prescription drugs, ambulances, glasses, hearing aids, orthotics, orthopaedic shoes, nursing care, massage therapy and psychologists, as well as routine dental care and repair.

So what should you do before those benefits disappear altogether?

Plan ahead — preferably well before your retirement date. If you're lucky, your employer may have already put together an information package for you, so check with HR first.