- While majority cite saving for retirement and a rainy day
as top priorities, less than half are setting money aside for
either
- Boomers worry about impact of inflation on retirement
savings
- More Canadians holding TFSAs than RRSPs
TORONTO, Feb. 26, 2020 /CNW/ - As a majority of
Canadians (74%) continue to worry about their savings and how to
balance immediate financial priorities against long-term needs,
they are increasingly struggling to bridge a savings gap. More than
half (53%) are now taking a "whenever I can" approach – the highest
level in five years – rather than regularly setting aside savings,
according to the annual RBC Financial Independence in Retirement
Poll.
The poll found that, while over half of Canadians cite saving
for retirement (56%) and a rainy day (53%) as their top financial
priorities, what they manage to save for either is falling well
short of their intentions. In fact, less than half of poll
respondents who identified these two priorities actually put any
savings toward them over the past year, with only 46% contributing
to a rainy day fund and 43% putting money aside for retirement.
Concerns about not meeting their retirement savings goals are
particularly weighing on the minds of those who are closest to
retiring – Boomers aged 55+ – with four-in-ten (40%) fretting that
they haven't saved enough money for their retirement years. Boomers
are also worrying about the impact inflation (40%) and any
weakening of the markets (36%) could have on the value of their
savings and investments.
Yet amidst these concerns, almost half (46%) of those aged 55+
do not have a financial plan in place, which could help them save
and invest for their retirement years.
"It's easy to connect the dots: many who aren't saving enough
don't yet have a financial plan," explains Stuart Gray, Director – Financial Planning
Centre of Expertise, RBC. "The most important first step is to
understand what your current finances will allow you to achieve.
From there, a financial advisor can help you develop a plan to
close any gaps and ease your concerns."
When Canadians with a financial plan (49%) were asked how they
felt about their financial future, responses were quite positive,
stating they felt organized (43%), optimistic (38%), confident
(35%) and reassured (33%). Resources such as RBC's MyAdvisor
make it easy to begin building a personalized plan, Gray adds.
"This is a great example of how less is more. We start by having
a simple 20-minute conversation with you, which can be by phone, or
in person at one of our branches, or even by live video if you
prefer – whichever way you find most convenient. Through this, we
help you begin to explore your options," says Gray. "You'll see
right away that it's never too late to begin making your money work
for you and it can be easier than you may think."
For the second consecutive year, the poll found that more
Canadians own TFSAs (60%) than RRSPs (49%) and, if Canadians could
only contribute to one, TFSAs continue to be preferred over RRSPs
by a 2:1 margin (50% vs. 25%). For Canadians wanting to grow their
savings, the big advantage of both TFSAs and RRSPs: the impact of
compounding when financial contributions to TFSAs and RRSPs are
invested.
"We explain this as gaining interest not only on your original
investment, but also interest on your interest, which helps your
earnings generate even more earnings," adds Gray. "That's a win for
anyone who invests inside their TFSAs and RRSPs."
More information about getting started on a plan and how TFSAs
and RRSPs can help build out savings and investments can be found
at www.rbcfinancialplanning.com.
RBC 2020 FINANCIAL INDEPENDENCE IN RETIREMENT POLL
National & Regional Comparisons
RESPONSES
|
CAN
|
BC
|
AB
|
SK/ MB
|
ON
|
QC
|
AC
|
Worried about
balancing
immediate priorities vs.
long-term needs
|
74%
|
71%
|
71%
|
74%
|
74%
|
78%
|
72%
|
Save 'whenever I
can'
|
53%
|
57%
|
47%
|
54%
|
57%
|
47%
|
47%
|
Top financial
priority:
Saving for retirement…
|
56%
|
57%
|
60%
|
62%
|
54%
|
51%
|
61%
|
…putting money
toward
saving for retirement
|
43%
|
42%
|
43%
|
48%
|
43%
|
42%
|
41%
|
Top financial
priority:
Rainy day fund…
|
53%
|
60%
|
46%
|
53%
|
54%
|
51%
|
56%
|
…putting money
toward
rainy day fund
|
46%
|
53%
|
43%
|
43%
|
51%
|
36%
|
46%
|
Top financial
priority:
Paying down debt…
|
40%
|
40%
|
38%
|
42%
|
41%
|
38%
|
38%
|
…putting money
toward
debt
|
42%
|
40%
|
42%
|
43%
|
44%
|
38%
|
43%
|
Don't have a
financial
plan
|
51%
|
47%
|
50%
|
45%
|
49%
|
56%
|
54%
|
Have a
TFSA
|
60%
|
63%
|
62%
|
65%
|
61%
|
59%
|
45%
|
Have an
RRSP
|
49%
|
50%
|
49%
|
50%
|
49%
|
53%
|
37%
|
Prefer TFSA to
RRSP
|
50%
|
53%
|
50%
|
50%
|
49%
|
51%
|
49%
|
RBC 2020 FINANCIAL INDEPENDENCE IN RETIREMENT POLL
Age Group & Gender Comparisons
RESPONSES
|
ALL
|
18-34
|
35-54
|
55+
|
Men
|
Women
|
Worried about
balancing
immediate priorities vs.
long-term needs
|
74%
|
70%
|
78%
|
81%
|
82%
|
62%
|
Save 'whenever I
can'
|
53%
|
52%
|
53%
|
50%
|
52%
|
54%
|
Top financial
priority:
Saving for retirement…
|
56%
|
59%
|
52%
|
44%
|
63%
|
57%
|
…putting money
toward
saving for retirement
|
43%
|
47%
|
39%
|
36%
|
49%
|
42%
|
Top financial
priority:
Rainy day fund…
|
53%
|
54%
|
53%
|
48%
|
49%
|
61%
|
…putting money
toward
rainy day fund
|
46%
|
45%
|
47%
|
50%
|
40%
|
48%
|
Top financial
priority:
Paying down debt…
|
40%
|
37%
|
43%
|
39%
|
47%
|
34%
|
…putting money
toward
debt
|
42%
|
38%
|
45%
|
45%
|
50%
|
32%
|
Worried about not
saving
enough for retirement
|
53%
|
49%
|
56%
|
59%
|
63%
|
40%
|
Worried about
impact of
inflation on value of
savings
|
38%
|
39%
|
37%
|
36%
|
37%
|
40%
|
Worried about
impact on
value of investments, if
markets weaken
|
34%
|
33%
|
34%
|
32%
|
32%
|
36%
|
Don't have a
financial plan
|
51%
|
47%
|
54%
|
48%
|
59%
|
46%
|
Have a
TFSA
|
60%
|
61%
|
59%
|
57%
|
54%
|
67%
|
Have an
RRSP
|
49%
|
51%
|
48%
|
40%
|
59%
|
48%
|
Prefer TFSA to
RRSP
|
50%
|
49%
|
51%
|
43%
|
41%
|
63%
|
About the RBC 2020 Financial Independence in Retirement
Poll
These are a selection of findings of the 30th annual
RBC RRSP Poll, conducted by Ipsos from December 10 to 17, 2019 on behalf of RBC
Financial Planning, through a national survey of 2,000 Canadians
aged 18+ who completed their surveys online. Quota sampling and
weighting are employed to balance demographics to ensure that the
sample's composition reflects that of the adult population
according to Census data and to provide results intended to
approximate the sample universe. The precision of Ipsos online
polls is measured using a credibility interval. In this case, the
poll is accurate to within ±2.2 percentage points had all Canadian
adults 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
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About RBC's financial planning advice and unique MyAdvisor
service
RBC Financial Planning offers planning advice and resources
and the RBC Retirement Planning website can help you plan
for 30 years or more in retirement. This financial advice is
complemented by a free service unique to RBC –
MyAdvisor – which connects clients to advisors and
financial planners for face-to-face, real-time video or phone
meetings, where together they can view and adjust a client's
comprehensive financial picture. In addition, Discover &
Learn offers free online advice, resources and tools for
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protect what's important, save and invest, borrow with confidence
or take care of their businesses.
SOURCE RBC Royal Bank