Paying Down Debt once again tops the list of financial priorities for
Canadians entering 2013, while Retirement Planning declines in importance
TORONTO, Jan. 2, 2013 /CNW/ - Canadians have named paying down debt as their
top financial priority entering 2013 - the third year in a row that debt has
topped the list of financial priorities across the nation. The annual poll
conducted for CIBC by Harris/Decima also shows that retirement planning has
fallen out of the top three priorities nationally, as age groups traditionally
focused on retirement planning have turned their focus to debt repayment and
other priorities in 2013.
Over the last three years of this CIBC poll, Canadians identified the
following as their top financial priorities:
|Paying Down Debt |17% |17% |14% |
|Building Savings |10% |10% |10% |
|Managing Day to Day Spending/Budgeting| 8% |14% |12% |
|Retirement Planning | 7% |11% |13% |
"These results highlight that Canadians are well aware of the importance of
good debt management and remain focused on reducing debt in the year ahead,"
commented Christina Kramer, Executive Vice President of Retail Distribution
and Channel Strategy for CIBC. "Having been named the top priority three years
in a row, there is an opportunity for more Canadians to turn awareness of debt
management into action and outline some clear steps towards paying down their
debt in 2013."
One of those steps could involve seeking advice about how to accelerate debt
repayment. About half (46 per cent) of Canadians surveyed said they had met
with an advisor in the last year, however only 6 per cent of those surveyed
thought about debt management as a topic of conversation with an advisor.
"Many Canadians are missing an opportunity to get advice about debt management
as part of their broader financial plan," noted Ms. Kramer. "As you repay
debt, you reduce interest costs which can free up some of your income to be
directed towards other goals, such as building up your savings account or
having a better monthly cash flow."
Some are Delaying Retirement Planning to Focus on Debt
A key finding of the poll is that age groups where retirement planning was
traditionally a top priority have now shifted to a focus on debt reduction.
-- Two years ago, 24 per cent of respondents aged 45-64 named
retirement planning as their top financial priority, which fell
to just 12 per cent in this year's survey.
-- At the same time, debt management increased as a priority from
14 per cent two years ago to 18 per cent today for this age
"While it is important to address immediate financial needs such as debt
reduction, it is equally important to keep long term goals such as retirement
in sight," commented Ms. Kramer. "Even small contributions today can make it
easier in future years to reach your retirement savings goals."
While it can be challenging to keep multiple financial goals top of mind, Ms.
Kramer added that getting advice can help to keep the two in balance.
"It is possible to make debt repayment a priority while still keeping up
regular investments into your retirement plan, and that can be made easier by
having a clear plan with an advisor that outlines the steps you can take each
month to get closer to your goals over time," added Ms. Kramer.
Advice on Delivering on Financial Priorities
-- Recognize that your finances are all connected - Making
progress on one aspect of your financial goals can lead to an
opportunity to improve in others, meaning you don't have to
focus on just one priority at a time. For example, a reduction
in debt can free up funds to go towards savings, or to further
accelerate debt reduction. Renewing your mortgage at a lower
interest rate can generate an improvement in cash flow that can
be used to start making RSP contributions earlier in life which
can grow over time.
-- Talk to an Advisor - Most Canadians don't think about making
debt reduction the topic of a conversation with an advisor, but
it can help you make progress on paying down debt by looking at
your overall financial picture and putting realistic steps in
place to reduce interest costs and accelerate debt repayment.
-- Stick to your Plan - Once you have a plan in place, stick to
it. If you fall off track, get back to your plan as soon as
possible and keep making progress towards your goal.
KEY POLL FINDINGS
Percentage of Canadians, by age, who named either paying down debt or
retirement planning as their number one financial priority entering 2013:
|Age Bracket|Paying|Retirement |
| | Down | Planning |
| | Debt | |
|18-24 | 12% | 0% |
|25-34 | 24% | 5% |
|35-44 | 28% | 4% |
|45-54 | 21% | 11% |
|55-64 | 13% | 13% |
|65+ | 7% | 4% |
Top Financial Priority entering 2013, by region:
| |Paying|Building| Managing |Retirement|
| | Down |Savings |Day to Day| Planning |
| | Debt | | Spending | |
|National | 17% | 10% | 8% | 7% |
|Atlantic Canada | 20% | 10% | 8% | 7% |
|Quebec | 14% | 6% | 5% | 7% |
|Ontario | 19% | 11% | 9% | 6% |
|Manitoba and | 19% | 11% | 10% | 6% |
|Saskatchewan | | | | |
|Alberta | 19% | 11% | 6% | 8% |
|British Columbia| 17% | 14% | 9% | 9% |
| | | | | |
Percentage of Canadians who have met with an advisor in the last year, by
|Atlantic Canada |36%|
|Manitoba and |40%|
|Saskatchewan | |
Each week, Harris/Decima interviews just over 1000 Canadians through teleVox,
the company's national telephone omnibus survey. These data were gathered in a
sample of 2,009 Canadians between October 25th and November 4, 2012. A sample
of this size has a margin of error of +/-2.2%, 19 times out of 20.
CIBC is a leading North American financial institution with nearly 11 million
personal banking and business clients. CIBC offers a full range of products
and services through its comprehensive electronic banking network, branches
and offices across Canada, and has offices in the United States and around the
world. You can find other news releases and information about CIBC in our
Press Centre on our corporate website at www.cibc.com.
Kevin Dove, Head of External Communications and Media Relations, CIBC: (416)
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CO: Canadian Imperial Bank of Commerce
NI: FIN ECOSURV
-0- Jan/02/2013 11:00 GMT
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