Relaxation/Vacation
Poll shows 18-34 group planning for retirement in unprecedented numbersYoung and seriousYoung people are planning for their senior years in unprecedented numbers, according a new survey by RBC Financial Group. MARYANNA LEWYCKYJ |
|
 [ 2006-12-19 ] |
Young people are planning for their senior years in unprecedented numbers, according a new survey by RBC Financial Group.
The poll results showed that 48% of respondents between the ages of 18 and 34 are planning for retirement, the highest figure in the 16-year history of the survey.
It also showed that 62% of people polled aged 18 to 34 now hold RRSPs, up from 44% five years ago.
"This was the most striking part of the poll results this year," said Dave Richardson, VP of RBC Asset Management Inc.
Across all age groups, the poll showed 68% of Canadians have RRSPs, up from 57% just five years ago.
Figures released by Statistics Canada last month revealed tax filers contributed a record $30.6 billion to RRSPs in 2005, up 6.2% from 2004.
HIGHEST LEVEL
More than 6.1 million Canadians contributed to an RRSP in 2005, up 2.2% from 2004 and the highest level since 2001.
Richardson points out that today's baby boomers are more educated about investing than any previous generation and the lessons are being handed down to their adult offspring.
"I think it's probably the exposure this younger population group has to another population group that is about to retire," said Richardson. "They see what their parents are about to face and they start to think about how that's going to impact them as well."
He also points out that a strong equity market, particularly in Canada, has piqued investment interest for young Canadians.
But Canadians aren't just counting on RRSPs and pensions to get them through their golden years.
Many hope their home will help bolster their nest egg.
The survey showed 34% of people who are not yet retired are expecting their home will be a source of retirement income.
INCOME
Of those considering their home to be a primary or secondary source of income in retirement, 40% anticipate the sale of their home or use of the home's equity, will account for up to half of their retirement income.
Richardson says investors should be careful not to put too much stock in their home as a primary source of income.
"You're still going to need a place to live," said Richardson. "To use your home equity, you're either going to have to refinance the home with a reverse mortgage, downsize or sell the property, which you or may not want to do at 65."
Do you have you a bad boss?