Canadians make guesswork of retirement planning

While many Canadians have an idea at what age they’d like to retire, they have little idea how much money they need before clocking out at work.

Based on an online CIBC poll of 1,544 Canadians conducted between Jan. 31 and Feb. 3, the average age at which Canadians hope to retire is 61.

However, over half of non-retired respondents (57%) wondered whether they could achieve retirement by that age, and most of these respondents (85%) didn’t have a formal financial plan for retirement.

While 21% of poll respondents said they calculated on their own the amount of money they’ll require for a comfortable retirement, 33% said they used their best guess, and 28% simply hoped they’d have enough.

Only 14% calculated a number with the help of a financial advisor.

A separate online poll of 2,005 Canadians by RBC conducted last October and released on Thursday revealed the potential need for financial planning among respondents aged 18 to 34. More than half (54%) had no financial plan, and 77% hadn’t connected with a financial advisor within the past year.

A challenge is that many of these respondents likely don’t know what financial planning is and may instead be lured by a faulty proposition: Nearly half (47%) said they were willing to pay fees for the opportunity to gain a better return on their investments.

The polling industry’s professional body, the Canadian Research Insights Council, says online surveys can’t be assigned a margin of error because they don’t randomly sample the population.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.