TORONTO, Feb. 26 /CNW/ - A new report from BMO Financial Group shows the
current recession has pushed Canadians into saving more of their hard-earned
dollars while supplementing their incomes through additional employment or
second mortgages. The findings also indicate more Canadians intend to
contribute to RRSPs this year.
The highlights from the BMO Savings Monitor survey, gauging the opinions
of Canadians on the global financial crisis and its impact on their saving and
investing strategies throughout the RRSP season, reveal:
- Almost half, 48 per cent, have taken steps to improve their savings
- Half of Canadians have created a household budget to help tame
- Two-thirds of Canadians will be making RRSP contributions this year,
up from only half in 2008
- In addition, 31 per cent have secured supplementary income through
additional employment or a second mortgage while 25 per cent have cut
back on big-ticket purchases
"What we're finding is that most people just aren't saving enough to meet
their expected living standards for when they retire," said Dr. Sherry Cooper,
Chief Economist, BMO Financial Group, and author of The New Retirement: How It
Will Change Our Future. "What I urge is that this is not the time to stop
saving. I urge that people continue to save as much as they can, to max out
their RRSPs, and to use the new tax-free savings accounts to the maximum
Despite the increased sums being stored away, the vast majority of
Canadians still don't have a financial plan.
- 42 per cent mistakenly believe they don't have enough funds to warrant
a financial plan
"With more money in Canadians' bank accounts, it's important they think
long term with respect to how they are managing their money, regardless of
whether it's a few thousand dollars or tens of thousands," said Linda Knight,
president and chief operating officer of BMO Mutual Funds. "It doesn't cost
anything to stop into a BMO branch and speak with a financial advisor who can
help make the most of their hard-earned dollars well into the future."
Over the past few months, money management among Canadians has shifted.
- Since December 2008, the percentage of Canadians who claim to be
taking a more serious look at their money has grown from 20 per cent
to 29 per cent.
- In addition, the number of Canadians who are considering withdrawing
from their RRSPs to supplement cash flow dropped from 15 per cent in
January 2009 to only 10 per cent in February.
- The number of Canadians who are considering cutting back on their RRSP
contribution dropped from 31 per cent in January 2009 to only 20 per
cent in February.
The common-sense approach to money management has also transferred to the
way Canadians who will receive a 2008 tax refund intend to spend it.
- 51 per cent planning to spend refunds on sensible, long-term needs,
including paying down credit cards (25 per cent); taking advantage of
the recent home renovation tax credit (22 per cent) and investing in a
TFSA or RRSP (20 per cent)
- Only 12 per cent intend to use their tax refund to pamper themselves
The recession has also led to an inevitable shift in Canadian family
concerns with more parents speaking to their kids about responsible spending.
- 41 per cent have begun reining in the amount of money they spend on
"Many of today's families are trying extremely hard to cope with the
current recession through various means," adds Knight. "It's not always easy
to know what are the right moves to make with your money, which is why we are
here to help make sense of money matters."
The Leger Marketing online poll was conducted from February 5 to 9, 2009
and is based on a sample of 1,502 Canadians aged 18 and older. The margin of
error for a sample of this size is +/- 2.5%, 19 times out of 20.
An instant replay of a media conference call with Dr. Sherry Cooper and
Judy Thomson is available until 6:00pm, February 27, 2009, at (416)
695-5800/1(800)408-3053, Passcode: 7104437.
For further information:
For further information: Deborah Rowe, Toronto, email@example.com,
(416) 867-4897; Lucie Gosselin, Montreal, firstname.lastname@example.org, (514)
877-1101; Laurie Grant, Vancouver, email@example.com, (604) 665-7596