What's Funding Your Future? Canadians relying on RRSPs for retirement but not necessarily contributing: Scotiabank Poll

  • One third of Canadians planning to retire have pushed back their planned retirement age.

TORONTO, Feb. 5, 2013 /CNW/ - With the RRSP contribution deadline just four weeks away, Scotiabank's annual Investment Poll found that two-thirds of Canadians who plan to retire say their RRSPs will be their source of retirement funding (65 per cent), yet half of Canadians say they do not plan to contribute to their RRSPs this tax season (49 per cent).

"We want to encourage as many Canadians as possible to consider contributing to an RRSP and take advantage of this important investment opportunity as part of their overall financial plan," Mike Henry, Senior Vice President, Retail Payment, Deposits and Lending, Scotiabank. "It is a bit worrying that people might be relying on investments that they have yet to make. Even making small contributions every month or year can really help your plans down the line."

In addition to their RRSPs, top sources of retirement funding for Canadians include their savings (60 per cent), the government (57 per cent), work pension (52 per cent) and selling their home (22 per cent).

Two-thirds of those who expect to retire say they are concerned about not having enough money to support their retirement (68 per cent).

Four in ten of those who expect to retire in the future (41 per cent) think they will need less than $300,000 for their ideal retirement. Over the past five years, Canadians say they have saved an average of $24,469 (this is down from the $31,824 they reported saving over a five year period in 2011).

The study also found that four-in-ten Canadians who are currently saving for retirement (44 per cent) have been doing so for the past 1-10 years. As well, more people are setting aside less than $200 each month (43 per cent vs. 34 per cent in 2011).

"As I like to tell my pre-retirement clients, there is no one dollar amount that you'll need for your retirement as every person's idea of retirement is unique," said Bev Moir, Senior Wealth Advisor, Retirement Planning at ScotiaMcLeod.  "The key is to start investing early, invest regularly and stay invested. Having a financial plan in place to help you map out what you can do throughout the year is a simple way to stay on track and look forward to making that all-important RRSP contribution worry-free. From automatic contributions to your RRSPs to choosing financial products that help you save as you spend, a financial advisor can help you develop a plan to suit your lifestyle."

Additional findings from the study found that while many Canadians say they are optimistic about the future of the Canadian economy (46 per cent), a growing number of Canadians who have yet to retire say they have pushed back their planned retirement age because of the state of the economy (33 per cent vs. 27 per cent in 2011).

The majority of those planning to hold off on retiring say they have pushed their retirement back by 5-9 years (58 per cent). A smaller group of Canadians say they plan to push it back by 10 or more years (27 per cent).

About the polling data
The 2012 Scotiabank Investment Poll was conducted online using Harris/Decima's proprietary panel. A total of 1,003 surveys were conducted from a random sample of panel members aged 18 years and over across Canada. The study was conducted from November 28th to December 13th, 2012.

About Scotiabank
Scotiabank is one of North America's premier financial institutions and Canada's most international bank. With more than 81,000 employees, Scotiabank and its affiliates serve some 19 million customers in more than 55 countries around the world. Scotiabank offers a broad range of products and services including personal, commercial, corporate and investment banking. In December 2012, Scotiabank became the first Canadian bank to be named Global Bank of the Year and Bank of the Year in the Americas by The Banker magazine, a Financial Times publication. With assets of $668 billion (as at October 31, 2012), Scotiabank trades on the Toronto (BNS) and New York Exchanges (BNS). For more information please visit www.scotiabank.com.

BACKGROUND INFORMATION:

Plan to Contribute to RRSP for 2012 Tax Year

Plan to contribute to RRSP for 2012 tax year Total Region
Atlantic Quebec Ontario Man/Sask Alberta BC
Yes 39% 34% 37% 44% 32% 46% 34%
No 49% 54% 54% 42% 57% 46% 52%
Don't know 12% 12% 9% 14% 11% 8% 14%


Funding For Ideal Retirement

How much needed for ideal retirement Total Region
Atlantic Quebec Ontario Man/Sask Alberta BC
Less than $1,000,000 (NET) 65% 57% 77% 59% 74% 52% 66%
  Less than $300,000 41% 48% 49% 39% 39% 21% 40%
  $300,000 - $999,999 24% 10% 28% 21% 35% 30% 26%
$1,000,000 - $1,999,999 22% 38% 16% 24% 16% 28% 15%
$2,000,000 or more 14% 5% 7% 17% 10% 20% 18%

Where money will come from

Total Atlantic Quebec Ontario Man/Sask Alberta BC
Your RRSP contributions 65% 69% 55% 72% 67% 65% 56%
Savings 60% 52% 56% 67% 48% 65% 55%
Government 57% 53% 51% 61% 60% 59% 57%
Work Pension 52% 61% 47% 54% 62% 45% 47%
Sell home 22% 31% 23% 22% 19% 24% 21%
Inheritance 22% 10% 15% 28% 17% 19% 24%
Investment property 15% 20% 14% 15% 8% 30% 11%
Lottery 7% 10% 6% 7% 5% 8% 9%
Equity in home 4% 6% 2% 3% 9% 8% 2%

 

 

SOURCE: Scotiabank

For further information:

Patty Stathokostas
P: 416 866 3625
E: patty.stathokostas@scotiabank.com