More Canadians saving, more money being saved
Survey also reports strong RRSP investment intentions
Winnipeg – November 27, 2007: A record-breaking 75 per cent of Canadians own RRSPs according to the sixth annual RRSP Investment Intentions poll from Investors Group. RRSP ownership has increased from 64 per cent last year, the second consecutive year this number has grown by 10 points or more.
Among Canadians who already have a RRSP, or plan to start one this year, three-quarters plan to contribute the same or more to their RRSP portfolios in the 2007 tax year than they did in 2006.
RRSP contributions strong across all age groups
Contribution intentions are strongest among respondents 55-years of age and under. Seventy-eight (78) per cent of Canadians aged 25 to 34 plan to contribute the same or more than they did last year. This number jumps to 82 per cent among 35 to 44 year olds and to 84 per cent among 45 to 54 year olds.
With older adults saving for their rapidly approaching retirement years, the message about saving seems to be getting through to the younger generation, as well. A strong majority of Canadians aged 25 to 34 (60 per cent) indicate they have an investment portfolio.
Canadians confident about debt in retirement
Investors Group’s RRSP Investment Intentions Poll found more than one-third of non-retired Canadians (35 per cent) plan to carry up to $100,000 in debt into retirement. Among those planning to carry debt into retirement, 45 per cent say it will be in the form of credit cards, lines of credit or personal loans, and 28 per cent say it will be for a mortgage on a primary residence.
"A focus on saving while carrying debt may seem contradictory, but it also suggests Canadians are balancing their lifestyles today against their plans for the future,” says Debbie Ammeter, Vice President, Advanced Financial Planning, Investors Group. “Most households carry monthly financial commitments, such as mortgages, car loans, and credit card payments. The challenge is finding the right comfort level in this balancing act.”
“Factors contributing to a greater comfort level among Canadians in managing debt include historically low interest rates, a healthy Canadian dollar and strong market performance,” says Ammeter.
Home equity supplementing retirement income
The recent strength of the Canadian housing market may also influence how Canadians plan to fund their retirement. One-in-five non-retired homeowners (19 per cent) plan to use home equity to generate retirement income.
Of those hoping to generate income from their home equity, 40 per cent believe their home will contribute between 10 and 30 per cent of their retirement income. Some of the most popular home equity strategies this group will consider include selling their home and buying something smaller (54 per cent); taking out a line of credit secured by home equity (22 per cent); taking out a reverse mortgage (15 per cent); or selling the home and renting (seven per cent).
A total of 2,055 surveys were completed with Canadian adults between September 4th and September 13th 2007, using the Harris Decima online panel. A sample of 2,055 respondents provides estimated proportions that are accurate to within, at most, ± 2.2% at the 95% confidence level. That is, 95 times out of 100, the real value of the variable in the total population will lie within ± 2.2% of the estimated proportions provided by the sample. One time out of 20, the real value of the variable in the population will fall outside this range.
Investors Group, founded in 1926, is a national leader in delivering personalized financial solutions to Canadians through a network of over 4,200 Consultants located throughout Canada. In addition to an exclusive family of mutual funds and other investment vehicles, Investors Group offers a wide range of insurance, securities, mortgage and banking services. Investors Group is a member of the IGM Financial Inc. (TSX: IGM) group of companies. IGM Financial is one of Canada’s premier financial services companies with over $125 billion in total assets under management.
| For more information contact: | |
|---|---|
| Ron Arnst Media Relations (204) 956-3364 ron.arnst@investorsgroup.com |
Teresa Pagnutti Environics Communications (416) 969-2721 tpagnutti@environicspr.com |
