On January 14, 2019, the Royal Bank of Canada (RBC) released the 2019 RBC Financial Independence in Retirement Poll, which uses findings from a poll conducted by Ipsos of over 2,000 Canadians online for RBC in November.
There are problems with online polling but we can assume that the figures they use are fairly good, but they are not definitive.
How much do you need for retirement? Many experts claim that a person should have between 50 and 70% of their current income a year in retirement. In Canada, if a person is working, they can expect that the Canada Pension Plan will replace between 25 to 30% of their working income. If you add the Old Age Security Benefit most Canadians can expect to have about 35 to 40% of their income covered by our government programs. This means that if you want to follow the guidelines by the experts you need to come up with a saving strategy or work for a company that has a pension plan that will replace between 15 to 35% of your current yearly income.
According to the survey, Canadians believe that they need $1 million to fund a comfortable financial future. As Canadians look to retirement, we hope to amass this amount in private savings held in TFSAs, RRSPs and other un-registered investment accounts.
In the survey, Canadians have identified their top four motivators to accumulating such a nest egg. These motivators are
1. being debt-free
2. having things to make life more comfortable
3. having money to take part in desired experiences
4. having enough to travel wherever you want.
However in Canada that million dollars is not a goal for all of us, in British Columbia, we need a little more than a million, we need about $1.07 million. Albertans think they need $916,000, those in Saskatchewan and Manitoba cite $907, 000 and Ontarians just $872,000. Quebecers need just $427,000. The figures are interesting when we compare them to the national average of $787,000. Men believe they’ll need $942,000, compared to women at just $650,000. I wonder why this is so as women tend to outlive men so should need more.
Canadians are prepared, according to the poll to take four actions to achieve the financial independence we want. These actions are:
1. spend less on non-essentials [74%]
2. eat out less [59%]
3. postpone major purchases [45%]
4. cut back on travel [34%].
Our goals as Canadians this year appears to be to delay gratification, live within our means, eliminate debt, and then grow our retirement income.
If you retire with debt, the debt can cause you some worry, but the good news is Canadians said clearly that they don’t want to live with debt and certainly don’t want to carry debt into retirement and if we are able to achieve our goals then we as a country are in good shape for the future.
There are problems with online polling but we can assume that the figures they use are fairly good, but they are not definitive.
How much do you need for retirement? Many experts claim that a person should have between 50 and 70% of their current income a year in retirement. In Canada, if a person is working, they can expect that the Canada Pension Plan will replace between 25 to 30% of their working income. If you add the Old Age Security Benefit most Canadians can expect to have about 35 to 40% of their income covered by our government programs. This means that if you want to follow the guidelines by the experts you need to come up with a saving strategy or work for a company that has a pension plan that will replace between 15 to 35% of your current yearly income.
According to the survey, Canadians believe that they need $1 million to fund a comfortable financial future. As Canadians look to retirement, we hope to amass this amount in private savings held in TFSAs, RRSPs and other un-registered investment accounts.
In the survey, Canadians have identified their top four motivators to accumulating such a nest egg. These motivators are
1. being debt-free
2. having things to make life more comfortable
3. having money to take part in desired experiences
4. having enough to travel wherever you want.
However in Canada that million dollars is not a goal for all of us, in British Columbia, we need a little more than a million, we need about $1.07 million. Albertans think they need $916,000, those in Saskatchewan and Manitoba cite $907, 000 and Ontarians just $872,000. Quebecers need just $427,000. The figures are interesting when we compare them to the national average of $787,000. Men believe they’ll need $942,000, compared to women at just $650,000. I wonder why this is so as women tend to outlive men so should need more.
Canadians are prepared, according to the poll to take four actions to achieve the financial independence we want. These actions are:
1. spend less on non-essentials [74%]
2. eat out less [59%]
3. postpone major purchases [45%]
4. cut back on travel [34%].
Our goals as Canadians this year appears to be to delay gratification, live within our means, eliminate debt, and then grow our retirement income.
If you retire with debt, the debt can cause you some worry, but the good news is Canadians said clearly that they don’t want to live with debt and certainly don’t want to carry debt into retirement and if we are able to achieve our goals then we as a country are in good shape for the future.
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