Advisors expect RSP contributions to remain steady this tax season: Online poll

(February 13, 2003) Despite shaky markets and weak investor confidence, advisors say the bulk of their clients will contribute about the same amount to their RRSP as last season, according to a recent online survey conducted by The ADVISOR Group.

Advisors were asked whether their clients plan to contribute more, less or the same amount to their RRSPs this tax period, compared to last. Sixty per cent said the same, 34% indicated less and only 5% said clients would contribute more.

About 200 advisors responded to January’s online poll, promoted in Advisor.ca’s daily e-mail bulletins.

The RRSP contribution findings were slightly weaker when compared to an informal online investor poll conducted for Advisor.ca and posted on the MoneySense.ca Web site in December. That survey indicated that three-quarters of investors would contribute the same or more to their RRSP this season.

Another poll conducted by TD Financial Group in November produced contrasting results. It found that the average RRSP contribution will be about 20% lower this tax season compared to last. Respondents to the TD poll said they would contribute an average of $3,900 to their RRSP for the 2002 tax year, down from last year’s average of $4,850.

The latest ADVISOR Group survey also found 43% of respondents’ clients are investing in RRSPs this tax season. The poll revealed that 48% of clients contribute to their RRSPs on an annual basis, while 43% prefer regularly monthly payments.

The survey included questions on the markets and economic performance. Nearly half said they expected stocks to rise in the next three months. Advisors also expect bond prices to decrease and interest rates to rise.

Asked for their current recommended asset allocation for an unrestricted portfolio, advisors chose, on average, 58% equities, 31% fixed income and 10% cash.

In addition, nearly 80% of respondents said they expect their client base to increase over the next 12 months.

Ninety-five per cent of respondents sell mutual funds, 77% sell insurance and 18% sell securities. The first Omnibus survey attracted advisors from across the country. The ADVISOR Group plans to conduct similar surveys every month and compare the results to past polls.

Are you surprised by the results of our survey? Is your experience this RRSP season similar to or vastly different from our results? Share your thoughts in the “Free for All” forum of the Talvest Town Hall on Advisor.ca.

Filed by Doug Watt, Advisor.ca, dwatt@advisor.ca