Clients’ top question: Have I saved enough?

“Have I saved enough?”

That’s the top question on the minds of half of Canadian pre-retirees, finds an RBC poll.

Read: 37% of boomers question if they have enough savings

A Franklin Templeton retirement survey confirms as much, finding that about half of Canadian pre-retirees (49%) are concerned about outliving their retirement assets or making major sacrifices in retirement.

Read: 30% of Canadian retirees face surprising costs

And more than two-thirds of Canadian respondents in the FTI survey say they experience stress and anxiety when thinking about savings and investments. On the bright side, that’s down from 72% the previous year.

The solution: soothe by keeping savings on track

The decline might be a case of recency bias, which is when investors focus on recent results, says Matthew Williams, senior vice-president at Franklin Templeton Investments, in a release.

“Canadians might have been looking back at the S&P/TSX composite index over the past year and seeing a return of 18% in 2016. In contrast, when they looked back on 2015, the same Canadian equity benchmark had fallen 11%,” he says. That distraction by short-term volatility makes working with an advisor important, he adds.

Indeed, having an advisor practically guarantees saving: 93% of pre-retirees with an advisor are saving for retirement versus 47% without.

Read: How to stay relevant in the age of robos

Further, about half (48%) of pre-retirees who have an advisor and who have saved more than $50,000 say their retirement will be better than previous generations. Only a third of pre-retirees without advisors think likewise.

Working in retirement: more fiction than fact

Some clients might try to self-soothe by deciding they’ll simply keep working.

In fact, almost two-thirds (65%) of Canadians not yet retired are considering working during retirement to earn income, with 19% of pre-retiree baby boomers expecting employment to be their primary source of retirement income, finds the Franklin Templeton survey.

Albertans are at the high end, with 70% of pre-retirees planning to work, compared to 61% of pre-retirees in both Quebec and Atlantic Canada.

But that might be nothing more than wishful thinking.

A CIBC poll finds that a third of respondents stopped working earlier than expected because of health issues (33%) or at the urging of employers (22%).

The RBC poll found that a mere 1% of retired respondents had started a new business.

Much ado about nothing?

In the end, chances are clients’ worries about running out of savings are fuelled by longevity expectations. But new research finds longevity for Canadian pensioners is lower than anticipated.

Canadian male pensioners are living about 1.5 years fewer than expected from age 65, reveals data from Club Vita Canada, a longevity analytics firm for Canadian pension plans. Female pensioners are living less long than expected by about half a year.

(The data are significant for defined-benefit plans, because the plans currently overestimate how long plan members live and therefore take an overly conservative approach to funding liabilities.)

While you’re probably not going to suggest to clients that they don’t have long to live, it’s helpful to remember that statistics for demographic cohorts aren’t applicable to individuals.

About the survey: The Franklin Templeton retirement survey was conducted online among a sample of 2,001 Canadians and 2,013 Americans ages 18 and older, from January 6 to 18, 2017.