Majority of Canadians Expect to Work After Retirement, Primarily to Stay Mentally and Socially Active: Scotiabank Study

  • More than one-third of Canadians plan to work after they retire out of financial necessity
  • Half of Canadians believe they will need to save less than a million dollars for retirement

TORONTO, Jan. 4 /CNW/ - Of those Canadians who plan to retire, more than two-thirds (69 per cent) plan to work during retirement, primarily to remain mentally (72 per cent) and socially (57 per cent) active, according to a recent Scotiabank study conducted by Harris/Decima assessing Canadians' attitudes toward retirement and investing. However, more than a third of Canadians (38 per cent) expect to work after they officially retire out of financial necessity.

"Being mentally and socially active is important at any age, and we are happy to see that these are the main reasons Canadians continue to work after they retire," said Gillian Riley, Senior Vice-President & Head, Retail Payments, Deposits and Lending, Scotiabank. "For the number of Canadians who feel they will not be financially prepared to retire, at Scotiabank we understand that planning for retirement can often be overwhelming and we want to help Canadians invest for their future so they can achieve their ideal retirement."

The study found that 56 per cent of Canadians think they will need less than one million dollars to fund their retirement, half of whom believe they will need less than $300,000. More than one-quarter of Canadians (28 per cent) think they will need between one and two million dollars and 16 per cent believe they will need two million dollars or more to fund their ideal retirement.

"While there's no magic number that Canadians should be aiming for when saving for retirement, it's important that Canadians are realistic about how they plan to spend their retirement and how much it will cost," said Ms. Riley. "Whether it be $250,000 or $1,000,000, it can be daunting to think about needing such a large sum of money, so it is equally important for Canadians to consider how much they can afford to put away for retirement and understand what that amount will mean for them down the road."

When it comes to how they plan to spend their retirement, the majority of Canadians plan to travel (86 per cent), spend time with family and friends (72 per cent), read (61 per cent) and exercise (60 per cent). Other retirement plans include taking up a hobby (50 per cent) and going back to school (24 per cent). 

As for saving for retirement, three-quarters (78 per cent) of those expecting to retire are currently putting money away for their future and they have been doing so for an average of 15 years. Half of Canadians (55 per cent) who plan to retire report saving less than $20,000 over the past five years.

"We all know that it's important to invest for our future, but with so many demands on our time and money it can be easy to put off saving for a goal that often seems far away," commented Ms. Riley. "At Scotiabank, we work with our customers to help make their long-term goals more tangible so they can take action and let the saving begin."

While the bulk of money for retirement will come from RRSP contributions and savings (78 per cent and 68 per cent respectively), many Canadians indicated their retirement would also be funded by money from the government (63 per cent), their work pension (55 per cent) or inheritance (27 per cent). A small number of Canadians expect to have retirement money come from the lottery (five per cent) or their kids (four per cent).

For more information about investing for your future, visit www.letthesavingbegin.com.

Let the Saving Begin is a Scotiabank program designed to inspire and empower Canadians to get on track with their saving, investing and borrowing habits.

Built on three simple principles, Let the Saving Begin encourages Canadians to:

  • Save automatically, because it works;
  • Invest for your future, because no one else will; and
  • Borrow to get ahead, not fall behind.

About the survey

A total of 1,011 completed surveys were collected from a random sample of Harris/Decima's panel members across Canada, of which 731 expect to retire. The study was conducted from October 14th, 2010 to October 25th, 2010. 

This was a standard panel survey among a random sample of Harris/Decima's Canadian panel members. In a fashion similar to a telephone study, email addresses from their panel were pulled at random, according to population and gender specifications, in order to make the study representative of the Canadian population by region and gender. When contacted to solicit participation, participants had no prior knowledge of the subject matter of the study. Harris/Decima controls access to the study through passwords to ensure that respondents can participate only once. Subsequent to completion of the study, the data was weighted by region, age, and gender.

About Scotiabank

Scotiabank is one of North America's premier financial institutions and Canada's most international bank. With more than 70,000 employees, Scotiabank Group and its affiliates serve some 18.6 million customers in more than 50 countries around the world. Scotiabank offers a broad range of products and services including personal, commercial, corporate and investment banking. With assets above $526 billion (as at October 31, 2010), Scotiabank trades on the Toronto (BNS) and New York Exchanges (BNS). For more information please visit www.scotiabank.com.

SOURCE Scotiabank

For further information:

Robyn Harper, Scotiabank Public Affairs, 416-933-1093, robyn_harper@scotiacapital.com.


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