One third say CPP will be their primary source of retirement income, but
seven-in-ten don't know the maximum amount
WINNIPEG, Feb. 19, 2014 /CNW/ - Canadians nearing retirement (aged
55-64) are confident they have enough money to live the retirement
lifestyle they desire but many do not know how much retirement income
they will need nor how much their company and/or government pensions
Sixty-nine per cent of Canadians approaching retirement age were unaware
of what the maximum monthly payout from government is for Canadian Pension Plan (CPP) or Quebec Pension Plan (QPP) and Old
Age Security (OAS), yet more than eight-in-ten of this age group say
they plan to use this as a source of retirement income, and more than
one third anticipate this will be their primary source, according to
new research from Investors Group.
A recent survey from Investors Group examining Canadians' knowledge of
their pension plans and their retirement income revealed that while
Canadians appear optimistic about their retirement lifestyle, few have
a firm handle on what their cost of living will be and what their
pensions will offer.
Sources of retirement income
Sixty per cent of Canadians say they plan to use an employer pension as
a source of income and 37 per cent say this will be their primary
However, of those who say they have workplace pensions and plan to rely
on it as their primary source of income, more than half (55 per cent)
did not know the monthly benefit they can expect.
"Planning for retirement at an early age will help Canadians to really
understand what will be required to maintain your desired lifestyle and
where savings and investments are needed to fill the pension gaps,"
said Dave Ablett, Director, Tax and Estate Planning, at Investors
Cost of living and what to expect
Seven-in-10 say that they will have enough to pay the cost of living in
retirement, yet when asked what they anticipate their monthly cost of
living to be, 42 per cent of unretired Canadians did not know. The
research revealed that as Canadians approach the age of retirement, a
significant number are still not aware of what it will take to support
their lifestyle with 39 per cent of Canadians aged 55-64 were still unclear on what to expect.
"As you near the age of retirement, it is even more important to
understand what your cost of living will be and to consider how that
amount may fluctuate throughout your retirement years," said Investors
Group's Ablett. "A financial advisor can help identify and plan for
retirement needs to avoid an inadequate retirement income."
Nearly three-quarters (72 per cent) of unretired Canadians are confident
they will be able to maintain their current lifestyle in retirement.
This number jumps to 91 per cent among Canadians working with a financial advisor.
While 39 per cent of Canadians say that confidence in their own money
management has gone up over the last 10 years, 58 per cent say their
confidence in younger generations' ability to save adequately for
retirement has gone down.
In addition, (66 per cent) of Canadians are less confident in
governments' ability to continue to provide an acceptable level of
pension and retirement benefits.
"While the survey indicates that Canadians are approaching retirement
with confidence, it also identifies the need for Canadians to gain a
better understanding of what their ideal financial future looks like so
they can build a plan to get there," said Dave Ablett of Investors
About the Survey Methodology
Data was collected using computer assisted telephone interviewing (CATI)
via the Harris/Decima teleVox omnibus. Overall, 1,010 completes were
collected nationally between January 23 and January 27, 2014. The
sample consists of 80% landline and 20% cell phone respondents, with
quotas by gender (50/50 split) and by region. The data is weighted in
tabulation to replicate actual population distribution by age and
gender within region according to the 2011 Census data. This survey is
considered accurate to a margin of plus or minus 3.1 per cent, 19 times
out of 20. The margin of error for subgroups is higher.
About Investors Group
Investors Group, founded in 1926, is a national leader in delivering
personalized financial solutions to Canadians through a network of over
4,600 Consultants located throughout Canada. In addition to an
exclusive family of mutual funds and other investment vehicles,
Investors Group offers a wide range of insurance, securities, mortgage
and other financial services. Investors Group is a member of the IGM
Financial Inc. (TSX: IGM) group of companies. IGM Financial is one of
Canada's premier financial services companies with over $132 billion in
total assets under management as of January 31, 2014.
SOURCE: Investors Group Inc.
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