- Number of younger Canadians with RRSPs highest since 2008
- Average contribution for all RRSPs rises to $4,653
- Regular contributions preferred by majority
TORONTO, Feb. 5, 2014 /CNW/ - Six-in-ten Canadian adults (59 per cent) now own RRSPs, after dipping to 55 per cent in 2012, and the amount they plan to contribute by this year's March 3rd deadline has risen to an average of $4,653, up about $500 compared to last year, according to the 24th Annual RBC RRSP Poll.
The poll indicates that younger Canadian adults in particular - those aged 18 to 34 - are showing increased attention to RRSPs. Half (50 per cent) of this age group now own RRSPs - the highest number in the past six years and a full 10 per cent higher than 2012 - and their planned RRSP contribution amount has jumped up by 39 per cent to an average of $4,329 compared to $3,104 last year. While three-quarters (74 per cent) of those with RRSPs indicate they won't be making the maximum allowable contribution this year, this is not necessarily a cause for concern, according to Richa Hingorani, senior manager, Financial Planning Support, RBC Financial Planning.
"Maxing out your contribution at the start of the year is great if you can afford it, but for most Canadians regular contributions throughout the year is a more realistic and effective approach," advised Hingorani. "By building RRSPs into your cash flow, you can start small and adjust as you go."
Hingorani added: "By making regular contributions to your RRSP, you ensure that time and compounding growth work to your advantage. And the best part is you don't have to scramble for cash as the holiday bills are arriving."
Other key findings about the RRSPs held by Canadians:
- Regular contribution plans continue to be the top means for adding money into RRSPs, with 34 per cent making regular contributions. Of these:
- 61 per cent contribute regularly (weekly, biweekly, monthly)
- One-quarter (25 per cent) make one-time contributions
- 10 per cent contribute whenever they have some money
- One-quarter (23 per cent) plan to contribute the maximum allowable
- 72 per cent of RRSP holders report they have unused contribution room
- Of these, 78 per cent don't expect to be able to/don't know if they will use up all of their contribution room before they retire
- Of these, 59 per cent aren't worried about unused contribution room impacting their ability to retire when they want to
- 81 per cent are not planning to change the investment mix within their RRSP
- Mutual funds continue to be the preferred investment choice; among the top three for all RRSP holders:
- Mutual funds: 43 per cent
- Savings accounts: 22 per cent
- GICs/term deposits: 20 per cent
24th ANNUAL RBC RRSP POLL - FAST FACTS
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About RBC's financial planning advice, resources and interactive tools
Canadians can access RBC Financial Planning and rbc.com/savingsspot for free planning, budgeting and savings advice and resources, or to find the nearest Investment and Retirement Planner. The RBC Advice Centre offers free online advice, resources and tools regarding retirement and estate planning including RRSPs and the RSP-Matic Savings Calculator. 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 budget and track their spending habits, as well as manage and plan their taxes.
About the 24th Annual RBC RRSP Poll
The 24th Annual RBC RRSP poll was conducted by Ipsos Reid between November 6 to 20, 2013 via a random sample of 2,062 Canadian adults in the general population (aged 18 and over). The results are based on samples where quota sampling and weighting are employed to balance demographics and ensure that the sample's composition reflects that of the actual population according to Census data. Quota samples with weighting from the Ipsos online panel provide results that are intended to approximate a probability sample. A weighted probability sample of 2,062 Canadian respondents, with 100 per cent response rate, would have an estimated margin of error of ±2.2 per cent, 19 times out of 20.
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