Canadians cut their retirement savings goal by more than $200,000: RBC Poll
TORONTO, Feb. 6, 2013 /CNW/ - Almost half (46 per cent) of retired Canadians
and only one-in-four (23 per cent) Canadians who are not yet retired have
determined the amount of money they will need for a comfortable retirement,
according to the 23(rd) Annual RBC RRSP Poll. Those who are not yet retired
have significantly reduced their retirement savings goal by more than $200,000
to an average of $564,000 in 2012 from $778,000 in 2011. Prior to retirement,
retirees estimated that they would only need an average of $347,000.
The gender gap has significantly narrowed between men's and women's retirement
savings goals, from a difference of $280,000 in 2011 down to $86,000 in 2012.
Men had an average retirement goal of $732,000 in 2011, which fell 42 per cent
to $424,000 in 2012, while women had an average retirement goal of $452,000 in
2011, which increased 13 per cent to $510,000 in 2012.
"When looking at your percentage of pre-retirement income needed in
retirement, some say 75 per cent, some say 85 per cent and some even say 110
per cent - we say everyone is different," said Jason Round, head, Financial
Planning Support, RBC Financial Planning. "While it's important to have a
retirement savings goal, there isn't one number that's right for everyone.
Your goals and dreams for retirement deserve a plan that's personalized to you
and takes into account many other relevant factors."
The RBC poll also found that Canadians have had a relatively consistent view
of how they are doing with their retirement savings over the past four years.
More than half of Canadians (53 per cent in 2012) say they are at or ahead of
where they should be in terms of retirement savings.
Round notes that using a rule of thumb approach in planning can be useful in
getting started when retirement is many years away but, as retirement nears,
averages are less helpful. There comes a point when you need to dig a little
deeper and create a plan for you based on you and the reality you will face in
retirement. For example, consider the following factors that will shape your
Longevity: Canada's aging population is a reality. According to Statistics
Canada, Canadians aged 65 in 2012 can expect to spend more than 20 years in
retirement. The average male retirement expectancy is 18 or more years; for
women it is 21 plus years. Retirement is not a single phase of your life but a
series of stages and living longer does not necessarily mean living the same.
How will your time horizon impact your retirement savings?
Health: Your personal health can affect your enjoyment of your retirement
years as well as your income. Almost one third (30 per cent) of retirees say
the cost of healthcare is among the top concerns in retirement. Do you have
health concerns? Have you planned to ensure healthy aging? Have you considered
the costs associated with potential or real health concerns?
Inflation: One-third of retired Canadians (32 per cent) state that inflation
and the effect it might have on their retirement finances is among top
concerns. What measures have you taken to manage inflation? How will you
maintain a sustainable level of income in retirement amidst unforeseeable
Work: Among the Canadian working population, 42.4 per cent are between the
ages of 45 and 64, a record high proportion, according to Census Canada 2011.
Canadians are increasingly choosing to continue to work or return to work
after retirement. The RBC Poll found 27 per cent of Canadians say they will
never retire and 23 per cent plan to open a business in retirement. Have you
considered whether you would choose to fully retire or return to work during
"Planning for retirement is so much more than just a magic number and this is
where financial advice can ensure all aspects of retirement are explored to
ensure you have the retirement you want," added Round.
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 including RRSPs, the RSP-Matic® Savings
Calculator and updates on the federal government's RRSP First Time Home
Buyers' Plan. 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.
About the 23(rd) Annual RBC RRSP Poll
The 23(rd) Annual RBC RRSP poll was conducted by Ipsos Reid between October 24
and November 27, 2012 via a random sample of 1,225 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 1,225 Canadian respondents, with 100 per cent
response rate, would have an estimated margin of error of ±3 per cent, 19
times out of 20.
Media contacts: Suzanne Willers, RBC, 416 974-2727 Kate Yurincich, RBC, 416
To view this news release in HTML formatting, please use the following URL:
CO: RBC Royal Bank
NI: FIN ECOSURV
-0- Feb/06/2013 10:00 GMT
Press spacebar to pause and continue. Press esc to stop.