But for many Boomers, the numbers won't add up without a detailed budget
TORONTO, May 17, 2012 /CNW/ - Most (71 per cent) Boomers can't wait to spend their time as they wish in retirement, but four-in-10 (42 per cent) of those not-yet-retired expect managing cash flow in retirement to be more difficult and 37 per cent are worried they do not have enough money to do what they want, according to the third annual RBC Retirement Myths and Realities Poll.
"It's understandable to have concerns about money management in retirement and that's where planning can help alleviate this anxiety," said Amalia Costa, head, Retirement Strategies, RBC. "Seeking financial advice and working with an advisor will help you to determine the lifestyle you want in retirement, to understand the financial implications and to develop the corresponding financial plan and budget."
Only half (52 per cent) of those expecting to retire within a year have a detailed budget as part of a financial plan. Furthermore, the survey found that retired Boomers require a higher percentage (60 per cent) of their annual pre-retirement income (up from 56 per cent in 2011 and 2010).
"When your retirement is years away, you are primarily focused on growing your retirement savings. Then when your actual retirement date nears, you need to get much more specific on two fronts," advises Costa. "First, you need to understand what your spending will be in this new phase of your life, including how much of this is for living expenses and how much is for more flexible lifestyle expenses. Then, you need to figure out how to most effectively use those accumulated savings, along with your other retirement resources to create a new pay cheque for yourself - one that aligns to your spending requirements."
Costa noted that the poll results show that only half of those within a year of retirement have created a detailed budget. This first step, along with working with a financial advisor to create a retirement income plan, can go a long way towards providing Canadians with a greater sense of control and certainty - translating into less anxiety and more enjoyment in retirement.
About the RBC Myths & Realities Poll
The third Annual RBC Retirement Myths & Realities Poll, which examines Canadians' expectations and experiences in retirement, was conducted by Ipsos Reid from February 24 to March 12, 2012. For this survey, a national sample of 2,833 adults aged 50 and over with household assets of at least $100,000 from Ipsos' Canadian online panel was interviewed online. A survey with an unweighted probability sample of this size and a 100 per cent response rate would have an estimated margin of error of ±2 percentage points 19 times out of 20 of what the results would have been had the entire population of adults in Canada been polled. All sample surveys and polls may be subject to other sources of error, including, but not limited to, coverage error and measurement error.
About RBC's financial planning advice, resources and interactive tools
The RBC Advice Centre offers free online advice, resources and tools regarding retirement and estate planning https://www.rbcadvicecentre.com/saving_and_investing/retirement_and_estate_planning]. In addition, RBC's myFinanceTracker, a comprehensive online financial management tool, offers all personal RBC online banking clients the ability, at no cost, to create a set budget and track their spending habits and to access H&R Block tax-related apps in the new myTax Centre, to help manage and plan their taxes.
Image with caption: "RBC Retirement Myths & Realities Poll 2012 - expectations of managing cash flow in retirement (CNW Group/RBC)". Image available at: http://photos.newswire.ca/images/download/20120517_C8361_PHOTO_EN_13821.jpg
Image with caption: "RBC Retirement Myths & Realities Poll 2012 - Methodology (CNW Group/RBC)". Image available at: http://photos.newswire.ca/images/download/20120517_C8361_PHOTO_EN_13822.jpg
Image with caption: "RBC Retirement Myths & Realities Poll 2012 - half of Boomers due to retire within one year say there is a budget included in their financial plan (CNW Group/RBC)". Image available at: http://photos.newswire.ca/images/download/20120517_C8361_PHOTO_EN_13820.jpg
Image with caption: "RBC Retirement Myths & Realities Poll 2012 - retirees are living on a higher percentage of their pre-retirement income than in the past two years (CNW Group/RBC)". Image available at: http://photos.newswire.ca/images/download/20120517_C8361_PHOTO_EN_13823.jpg
For further information:
Suzanne Willers, RBC Corporate Communications, 416 974-2727,
Kate Yurincich, RBC Corporate Communications, 416 974-1031,