According to a new survey, the pandemic hasn’t seriously affected Canadians’ retirement goals or expectations
By Caitlin Finlay
Despite the financial strains of 2020, a survey from BMO has found only a small drop in the number of Canadians who say they have confidence in their retirement plans.
Conducted in November 2020 and released on January 20, BMO’s annual retirement survey showed that 54% of Canadians are confident that they’ll have sufficient funds to retire at the age they want to, which was only a 4% decrease from the 2019 survey results. Residents from Ontario and the Prairie provinces had the highest level of confidence in their retirement plans at 58% and 57%, respectively, and the lowest confidence in retirement plans was in the Atlantic provinces, with 42%.
As for the age at which Canadians hope to retire, the survey found that the average age is 62, with a third of respondents saying they plan to retire between 60 and 69 years of age. While just over half of Canadians—53%—say they have no set estimate for the amount of money they’ll need for retirement, those who do have a figure in mind estimate they’ll need $1.4 million, an increase of 6% from 2019.
The survey also found that 64% of Canadians have contributed to or plan to contribute to their RRSPs before the March 1 deadline, a number essentially unchanged from 2019. Residents of Quebec (51%) and the Atlantic provinces (60%) are the least likely to contribute to RRSPs, while the most likely were those in both Ontario and British Columbia (67%). Withdrawals from RRSPs by those under 71 years of age decreased from 37% in 2019 to 28% in 2020. Pandemic-related withdrawals accounted for only 6% of early withdrawals, with most withdrawals going towards purchasing a house.
“The past year was challenging for Canadians in many ways, including financially,” Robert Armstrong, the director of Multi-Asset Solutions for BMO Global Asset Management, said in a release. “It‘s encouraging to see such resilience among Canadian investors, and the continued prioritization of retirement planning.”