Baby Boomers Set to Redefine Retirement
New national poll shows Boomers have ambitious expectations for active retirement lifestyle
Winnipeg, MB – January 6, 2005: It has been almost 40 years since The Beatles first mused about the golden years in their song “When I’m 64”. Today, that reality is much closer at hand for baby boomers, who begin turning 59 this year. According to a new national poll released today by Investors Group, baby boomers are set to redefine retirement with far more active and ambitious plans for their golden years than current retirees.
“As we have seen throughout their history, baby boomers are redefining each phase of life they reach,” says Debbie Ammeter, Vice President of Advanced Financial Planning for Investors Group. “They are set to redefine retirement just like they redefined their teenage years with hula hoops and rock and roll.”
The national poll conducted for Investors Group by Decima Research found a sharp contrast between the retirement plans of baby boomers and the lifestyle of current retirees. For example, 56 per cent of working baby boomers today (poll respondents between the age of 45-54) say they plan to get away for some or a lot of the harshest months of winter in retirement, while only 27 per cent of current retirees actually do that now.
The contrast is evident through a range of questions about retirement:
- 59 per cent of baby boomers plan to devote a lot of their time to hobbies in their retirement, while only 45 per cent of retired Canadians actually do so today;
- 28 per cent of baby boomers plan to purchase a vacation property, motor home or boat in their retirement, while only 15 per cent of retired Canadians said that they plan to make or have made such a purchase in their retirement; and,
- 82 per cent of baby boomers plan to do some or a lot of physical recreational activities, while only 64 per cent of retired Canadians report doing the same.
“The baby boomers’ shadow of influence is as long as ever,” says Ammeter. “The research also shows that the retirement attitudes of working Canadians trailing the baby boomers (aged 18-44), are quite similar to the boomers, which suggests the boomers are once again redefining an important life stage, not only for themselves, but for generations to follow.”
A good example of how the baby boom generation is ushering in new attitudes about retirement comes with a question about volunteering. Some 70 per cent of baby boomers plan to spend some or a lot of their time doing volunteer work in retirement, while 62 per cent of working Canadians between the age of 18 and 44 plan to do the same. By comparison, only 48 per cent of retired Canadians today say they are spending some or a lot of their time volunteering.
“The combination of longer life expectancies and plans for more active retirement lifestyles will come with a price tag,” says Ammeter. “Given that boomers are the next generation to retire, it is striking that over half don’t know how much their retirement will cost.”
The poll found that 56 per cent of baby boomers had not determined, either on their own or with a financial planner, how much income they will need during retirement including how much money they will need to save or invest to achieve this income.
The research also found that among baby boomers, who have developed a reputation as consumer borrowers, many have done a good job of saving money. Over 18 per cent of boomers said they had household savings and investments worth over $250,000. Another 21 per cent said they had saved between $100,000 and $250,000. “While many baby boomers have done a good job of saving for retirement, without a plan they won’t have the reassurance that their expected retirement income will support their desired lifestyle,” said Ammeter.
Many baby boomers and the generations of working Canadians behind them expect to participate in some form of self-employment or consulting work in their retirement. While 51 per cent of baby boomers (and 53 per cent of all working Canadians) plan to work on their own or do some consulting work in retirement, only 22 per cent of retired Canadians do the same today.
“Working in retirement can be an excellent way of remaining active, and can help finance retirement expenses but Canadians may or may not find the kind of part-time employment that suits their lifestyle in retirement. If their retirement plan is dependent on working, they may compromise their retirement dream,” says Ammeter.
Below are four simple tips to turn your dream retirement into reality:
- As you approach retirement, take the time to define your goals for retirement. Consider whether you want to travel, participate more actively in a hobby, buy a cottage, etc.
- Work with a professional financial planner to determine how much after tax income your savings and pension plans can generate, and how much your retirement lifestyle will cost
- Develop a strategy to achieve your retirement goals with specific saving and investment plans.
- Monitor your strategy annually and adjust for any changes in goals, assumptions, and/or personal circumstances.
The survey results are based on a Decima TeleVox national telephone survey conducted with a representative sample of 2,035 adult Canadians between September 11-21, 2004. A sample of this size will provide results that can be considered accurate for the population overall to within plus or minus 2.2 per cent, 19 times out of 20.
Investors Group is a national leader in delivering personalized financial solutions to more than one million Canadians, through a network of close to 3,200 Consultants located in 100 Financial Planning Centres. In addition to an exclusive family of mutual funds, managed asset and other investment vehicles, Investors Group offers a wide range of mortgage, insurance, brokerage and banking services. Investors Group is part of IGM Financial Inc. and a member of the Power Financial Corporation group of companies.
| For more information contact: | ||
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| Ron Arnst Media Relations (204) 956-3364 ron.arnst@investorsgroup.com |
Mike Van Soelen Environics Communications (416) 969-2717 mvansoelen@environicspr.com |
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