Gen X getting a good grip on planning, Investors Group research finds
WINNIPEG, Jan. 4 /CNW/ - Sometimes referred to as the 'lost' generation,
Generation X - the segment of the Canadian population between the ages
of 30 and 44 - may be finding its financial way according to new
research by Investors Group.
Results of a new poll probing the Gen X retirement mindset revealed a
majority (58 per cent) have a clear vision for their retirement life
and what they will be doing with their time. This compares favourably
with the findings of an earlier retirement survey by Investors Group which found that two-thirds of their Boomer aged
parents (66 per cent) say they have a clear retirement vision. Echoing
the sentiment of their elders, 60 per cent of Gen Xers think that
retirement will be an exciting stage of their lives.
The two generations also display similar approaches to saving and
investing for retirement. Sixty-one per cent of Gen Xers have RRSPs and
of those, 85 per cent plan to contribute the same or more in the
upcoming tax year. This compares to 62 per cent of Boomers who have
RRSPs, 79 per cent of whom who will be contributing the same or more to
their RRSPs. TFSAs are equally popular for both generations as well.
Four out of ten (39 per cent) Gen Xers have opened TFSAs, almost the
same as 43 per cent of Boomers who have.
"Gen X and Boomers may have some differences, but it appears the apple
doesn't fall far from the tree in financial planning," says Debbie
Ammeter, Vice President, Advanced Financial Planning of Investors
Group. "Gen Xers share remarkably similar dreams and hopes especially
when it comes to their vision of retirement and how they are going to
According to the research, Gen Xers plan to spend much of their
retirement years enjoying the same activities as their parents. Like
Boomers, travel scores highest on the list of retirement pleasures for
Gen X (68 per cent) along with no work pressures (58 per cent). Boomers
rank travel and no work pressures at 61 per cent and 58 per cent
Taking extended life expectancies into consideration, Gen X may be able
to enjoy some retirement time together with their Boomer parents—if Mom
and Dad agree. Surprisingly, spending time with family (57 per cent)
rates higher as a retirement pastime for Gen Xers than it does for
Boomers (46 per cent).
The concept of 'working retirement', pioneered by Boomers, also appears
to be taking hold in the next generation. Four-out-of-ten Gen Xers as
well as Boomers expect to gradually retire by working fewer hours from
their current employer.
"It may be that Boomers have fundamentally changed the way retirement is
viewed and the kids are following in their footsteps," says Ammeter of
Investors Group. "But it is also possible that the Gen X retirement
lifestyle vision could change as this demographic cohort continues to
According to Investors Group's research, a majority (62 per cent) of Gen
Xers believe they will have to fund their own retirement. Half (51 per
cent) expect to fund their own medical and personal care. Boomers have
very similar views with 60 per cent saying they will have to fund their
retirement and 56 per cent expecting to pay for their own care.
When compared to Boomers, Gen Xers recognize that government pensions
might not play as large a role in their retirement income (25 per cent and 20 per cent respectively) and see RRSPs as a more
important income source (21 per cent versus 16 per cent). Only 3 per
cent expect inheritance to be a primary source of retirement income.
Fifty-four per cent of Gen Xers follow a spending budget while four of
ten (39 percent) work with a financial advisor to help them make
investing and saving decisions.
"Given the financial challenges confronting them, including uncertain
economic times, it's notable that many are not putting financial
planning on the back burner," said Ammeter. "But there's certainly room
Among Gen X RRSP contributors, 43 per cent plan to invest in the stock
market via mutual funds while 28 per cent say they plan to put it in
GICS, governments or money market investments. Twenty per cent are not
sure where they plan to invest their money.
It depends on perspective
One area of apparent disagreement between Gen X members and Boomers is
the impact on society that Boomers have had. Perhaps not surprisingly,
Boomers appear to be more impressed while Gen Xers are less moved.
One-in-four (27 percent) Gen Xers think that Boomers had an exceptional
or positive impact on society, politics and the economy and the
majority give them mixed marks—64 per cent say their influence was both
positive and negative.
Boomers, on the other hand, beg to differ. Forty-five per cent believe
their generation had an exceptional or positive impact on society.
"Like so many other things in life, your viewpoint depends at least
partially on your perspective," said Ammeter.
About the Survey Methodology
This Harris/Decima Poll was conducted online within Canada between
October 28 and November 9, 2010 among 2,031 adults (aged 18 and
over). Respondents for this survey were selected from among those who
have agreed to participate in Harris/Decima surveys. The data have been
weighted to reflect the composition of the adult population. Because
the sample is based on those who agreed to participate in the
Harris/Decima panel, no estimates of theoretical sampling error can be
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 $125 billion in
total assets under management.
SOURCE Investors Group Inc.
For further information:
Teresa Pagnutti or Lisa Mills