62 per cent of millennials have started putting money away for their "golden years", many started before 25
TORONTO, Jan. 19, 2016 /CNW/ - A new survey by Tangerine* found that the younger generation of Canadians are getting the message to start saving early and build a nest egg for retirement. The survey revealed that despite being in the early stages of their career or still in school, 62 per cent of millennials (those 18-34) have started saving for retirement and almost half (46 per cent) said they started before the age of 25.
These results are additionally impressive when compared to the 81 per cent of older working Canadians** aged 35-65 who are currently saving for retirement. When asked when they started saving, only 18 per cent reported to have started before the age of 25.
Millennials also appear to have their sights set high, with 40 per cent believing they will need more than $1 million saved for retirement. To meet this expectation, many millennials (63 per cent) expect to retire over the age of 60, which is slightly more optimistic than the rest of Canadians, with 74 per cent expecting to retire over the age of 60.
"Our survey results have consistently shown that Canadians expect to retire later in life, or they've had to return to work after retirement," said Silvio Stroescu, Managing Director of Deposits and Investments at Tangerine. "It's encouraging to see that many young Canadians have now started saving earlier, to help fund the retirement they envision and perhaps even retire earlier as a result, without having to go back to work."
Of those 38 per cent of millennials not yet saving for retirement, many (62 per cent) say it's because of their low salary or not having enough money, and another 23 per cent said it's because they are saving for a big ticket item like a house, a wedding, or travel.
'YOLO' OR RETIRE YOUNG?
- 59 per cent of millennials would only go out once a week to socialize with friends in order to retire before the age of 65
- 47 per cent of millennials would give up takeout food and cook all their meals to retire before the age of 65
- Over a quarter (28 per cent) of millennials would work 50+ hours a week for the remainder of their working career to retire in their 50s
- 43 per cent of millennials would give up all forms of social media to retire before the age of 50
- 22 per cent of millennials would forego contributions to their retirement savings for a luxury 'must-have' purchase like a smart phone, concert tickets or designer handbag
MAKING IT AUTOMATIC
Regardless of when they started saving or when they expect to retire, both millennials and older working Canadians share the same perspective on the best strategy for retirement saving - make it automatic. 42 per cent of millennials and 41 per cent of older working Canadians recommend setting up an Automatic Savings Program. Another 25 per cent of millennials and 28 per cent of older working Canadians said their best method for saving for retirement is participating in their company's matching program.
RETIREMENT SAVINGS 101
Across the different age groups, the survey's findings were consistent when it comes to financial literacy. 58 per cent of both millennials and older working Canadians felt they did not learn enough about saving for retirement before they started. When asked where they learned about saving for retirement, both millennials (63 per cent) and older working Canadians (66 per cent) said it was self-taught. However, 43 per cent of millennials also reported learning from their parents, compared to just 26 per cent of older working Canadians over 34.
For information on saving, investing and planning for retirement, visit Tangerine.ca/forwardthinking.
**For the purposes of this survey, "older working Canadians" or "the rest of Canadians" refers to those outside the millennial group (18-34) who are working and are aged 35-65.
*From December 29, 2015 to January 4, 2016, Vision Critical conducted an online survey on Tangerine's behalf among 2,017 randomly selected Canadian adults who are Angus Reid Forum panelists. 1,010 are aged 18 to 34, and are either employed or full-time students. 1,007 are aged 35-65 and employed. The margin of error for each sample group - which measures sampling variability - is +/- 3.1 per cent, 19 times out of 20. Discrepancies in or between totals are due to rounding.
Tangerine is a direct bank that delivers simplified everyday banking to Canadians. With more than 1.9 million clients and close to $38 billion in total assets, we are Canada's leading direct bank. Tangerine offers banking that is flexible and accessible, products and services that are innovative, fair fees, and award-winning client service. From no-fee daily chequing and high-interest savings accounts, GICs, RSPs, TFSAs, mortgages and mutual funds, Tangerine has the everyday banking products Canadians need. With over 1,000 employees in Canada, our presence extends beyond our website and Mobile Banking app to our Café locations, Pop-Up locations and 24/7 Contact Centres. Tangerine was launched as ING DIRECT Canada in 1997. In 2012 it was acquired by Scotiabank, and operates independently as a wholly-owned subsidiary. For more information, visit tangerine.ca
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For further information: Cayley Kochel, Tangerine, 416-497-5157 ext. 4013, firstname.lastname@example.org