- Impact of inflation on retirement finances now one of
Canadians' top concerns
- RRSPs rebound, as financial priorities shift to
longer-term saving and investing
- Investors willing to pay fees for opportunity to gain
higher returns
TORONTO, Jan. 21, 2022 /CNW/ - With inflation reaching the
highest levels in the past 30 years, Canadians trying to refocus on
their financial future now face a new uncertainty: the effects of
rising inflation on their retirement savings. According to RBC's
annual Financial Independence in Retirement Poll,
inflation has now moved into the top three concerns Canadians have
about retirement for the first time in more than a decade.
"When assessing value, investment performance after fees is what
really matters. It's encouraging to see that younger Canadians
understand how crucial this is in achieving your retirement savings
goals and building a strong financial future."
Inflation is also limiting the ability of Canadians to increase
any savings, as it continues to drive up the costs of fixed
expenses – a key savings barrier referenced by 29% of poll
respondents, with the largest number of these (40%) being aged 25
to 34. A majority (85%) of this younger age group also worries the
most about trying to balance saving for today versus saving for
their future.
There is a key difference across all age groups, however,
despite the uncertainties posed by the pandemic and rising
inflation. Today, almost half (48%) of Canadians have a financial
plan and the majority (86%) of those say they are feeling positive
about their financial future because of that plan.
"The unexpected has changed lives over the past two years, but
if you have a plan, it's easier to adapt to those changes," says
Stuart Gray, Director – Financial
Planning Centre of Expertise, RBC. "A plan helps you keep on top of
your finances, so you know what adjustments you can make for
changing circumstances while saving for today and investing for the
future."
One strong indicator that Canadians want to refocus on their
financial future: RRSPs are making a big comeback. After seven
years of trending downward – and last year's historic low of 46% –
RRSPs have rebounded and now over half (53%) of Canadians have
RRSPs in place to save and invest for their retirement. Also,
within those RRSPs, more Canadians are holding mutual funds (36%
vs. 30% last year), stocks (20% vs. 14%) and ETFs (11% vs. 7%).
Another future-focused indication in poll findings: the
percentage of Canadians who are building their investment
portfolios has risen to 28% from 25% last year (and 10 points
higher than a decade ago). Of particular note, younger investors
aged 25 to 34 are also expressing the most interest in building
these portfolios (32%). Since the onset of the pandemic, these
younger investors are also focusing more attention on the value of
their investments (22%) and almost half (48%) indicate they are
willing to pay fees if this offers the opportunity to gain higher
returns on those investments.
"When assessing value, investment performance after fees is what
really matters. It's encouraging to see that younger Canadians
understand how crucial this is in achieving your retirement savings
goals and building a strong financial future," adds Gray. "Whenever
you want advice, our financial advisors are here to help – in
person or through our MyAdvisor digital advice platform,
which connects you to an interactive, personalized plan where you
can review forward-looking projections and try out different
savings scenarios. This makes it easy to see how changes you make
to your savings and investments today can impact your finances in
the future."
Fast Facts: RBC 2022 Financial Independence in Retirement
Poll
Selected findings – National and
regional
Top concerns
about
retirement finances
|
NAT'L
|
BC
|
AB
|
SK/MB
|
ON
|
QC
|
AC
|
Having enough
savings
|
47%
|
43%
|
44%
|
47%
|
47%
|
52%
|
44%
|
Maintaining my
standard
of living
|
36%
|
39%
|
31%
|
34%
|
36%
|
42%
|
29%
|
Impact of
inflation
|
29%
|
33%
|
31%
|
28%
|
29%
|
26%
|
32%
|
The cost of
healthcare
|
27%
|
30%
|
25%
|
21%
|
24%
|
31%
|
29%
|
Outliving my
savings
|
25%
|
29%
|
30%
|
29%
|
28%
|
16%
|
29%
|
Barriers to saving
more
|
NAT'L
|
BC
|
AB
|
SK/MB
|
ON
|
QC
|
AC
|
Income too
low
|
36%
|
38%
|
41%
|
45%
|
37%
|
30%
|
34%
|
Fixed expenses too
high
|
29%
|
35%
|
38%
|
37%
|
29%
|
22%
|
24%
|
No money left over
at the
end of the month to save
|
26%
|
25%
|
30%
|
32%
|
24%
|
25%
|
31%
|
Unexpected
expenses
(dentist, car repairs, etc.)
|
26%
|
32%
|
36%
|
29%
|
23%
|
22%
|
27%
|
Unsteady work
income
|
13%
|
13%
|
17%
|
9%
|
14%
|
11%
|
10%
|
Have a financial
plan?
|
NAT'L
|
BC
|
AB
|
SK/MB
|
ON
|
QC
|
AC
|
Yes, I
do
|
48%
|
47%
|
49%
|
49%
|
51%
|
44%
|
46%
|
RRSPs
|
NAT'L
|
BC
|
AB
|
SK/MB
|
ON
|
QC
|
AC
|
Yes, I have an
RRSP
|
53%
|
50%
|
51%
|
55%
|
56%
|
55%
|
44%
|
RRSP holds mutual
funds
|
36%
|
42%
|
40%
|
40%
|
38%
|
27%
|
35%
|
RRSP holds
stocks
|
20%
|
30%
|
11%
|
19%
|
22%
|
15%
|
11%
|
RRSP holds
ETFs
|
11%
|
13%
|
12%
|
5%
|
13%
|
10%
|
2%
|
Investing during
pandemic
|
NAT'L
|
BC
|
AB
|
SK/MB
|
ON
|
QC
|
AC
|
Building my
investment
portfolio
|
28%
|
33%
|
20%
|
24%
|
32%
|
27%
|
20%
|
Focusing on the
value of
my investments
|
22%
|
24%
|
19%
|
25%
|
24%
|
21%
|
15%
|
Willing to pay fees
for
higher returns
|
46%
|
49%
|
47%
|
42%
|
46%
|
44%
|
43%
|
Fast Facts: RBC 2022 Financial Independence in Retirement
Poll
Selected findings – National, gender and age
group
Top concerns
about
retirement finances
|
NAT'L
|
M
|
F
|
25-34
|
35-54
|
55+
|
Having enough
savings
|
47%
|
44%
|
49%
|
58%
|
55%
|
36%
|
Maintain standard of
living
|
36%
|
33%
|
38%
|
44%
|
40%
|
31%
|
Impact of
inflation
|
29%
|
30%
|
28%
|
32%
|
26%
|
34%
|
The cost of
healthcare
|
27%
|
26%
|
27%
|
21%
|
26%
|
32%
|
Outliving my
savings
|
25%
|
23%
|
27%
|
20%
|
26%
|
26%
|
Key barriers to
saving more
|
NAT'L
|
M
|
F
|
25-34
|
35-54
|
55+
|
Income too
low
|
36%
|
32%
|
40%
|
41%
|
35%
|
32%
|
Fixed expenses too
high
(rent, mortgage, food, etc.)
|
29%
|
24%
|
35%
|
40%
|
32%
|
23%
|
No money left over
at end
of the month to save
|
26%
|
21%
|
30%
|
26%
|
30%
|
22%
|
Unexpected
expenses
(dentist, car repairs, etc.)
|
26%
|
21%
|
31%
|
32%
|
29%
|
22%
|
Unsteady work
income
|
13%
|
12%
|
13%
|
15%
|
13%
|
8%
|
Have a financial
plan?
|
NAT'L
|
M
|
F
|
25-34
|
35-54
|
55+
|
Yes, I
do
|
48%
|
49%
|
48%
|
47%
|
44%
|
53%
|
RRSPs
|
NAT'L
|
M
|
F
|
25-34
|
35-54
|
55+
|
Yes, I have an
RRSP
|
53%
|
57%
|
51%
|
53%
|
61%
|
54%
|
RRSP holds mutual
funds
|
36%
|
35%
|
37%
|
33%
|
38%
|
38%
|
RRSP holds
stocks
|
20%
|
25%
|
12%
|
21%
|
19%
|
16%
|
RRSP holds
ETFs
|
11%
|
14%
|
8%
|
16%
|
10%
|
10%
|
Investing during
pandemic
|
NAT'L
|
M
|
F
|
25-34
|
35-54
|
55+
|
Building my
investment portfolio
|
28%
|
33%
|
24%
|
32%
|
27%
|
26%
|
Focusing on the
value of my investments
|
22%
|
26%
|
19%
|
22%
|
19%
|
27%
|
Willing to pay fees
for higher returns
|
46%
|
49%
|
43%
|
48%
|
46%
|
43%
|
About the RBC 2022 Financial Independence in
Retirement Poll
A total of 2,000 surveys were completed
online by Ipsos among Canadians aged 18+ from October 22 to 30, 2021 using the Ipsos I-Say
Panel for this poll, which has been conducted on behalf of RBC for
over three decades. Quota sampling and weighting was employed in
order to balance demographics and ensure that the sample's
composition reflects that of the actual population of Canadians,
according to Census data. The precision of online polls is measured
using credibility interval. In this case, the results are accurate
to within ± 2.5% percentage points, 19 times out of 20, of what the
results would have been had the entire population of adults in
Canada been surveyed. Credibility
intervals will be wider for smaller subsets of the population.
Where appropriate, attitudes and opinions are tracked back to
previous years' polls.
About RBC
Royal Bank of Canada is a global financial institution with
a purpose-driven, principles-led approach to delivering leading
performance. Our success comes from the 87,000+ employees who
leverage their imaginations and insights to bring our vision,
values and strategy to life so we can help our clients thrive and
communities prosper. As Canada's
biggest bank, and one of the largest in the world based on market
capitalization, we have a diversified business model with a focus
on innovation and providing exceptional experiences to our 17
million clients in Canada, the
U.S. and 27 other countries. Learn more at rbc.com.
We are proud to support a broad range of community initiatives
through donations, community investments and employee volunteer
activities. See how at rbc.com/community-social-impact.
About RBC and our unique MyAdvisor personalized planning
support
We believe that every Canadian deserves a
personalized plan. MyAdvisor – a digital advice platform only
available at RBC – has now connected over 2.8 million Canadians to
their personalized plan and the ability to adjust those plans in
real time. MyAdvisor offers a hybrid approach, so you don't have to
choose between digital or human – you get both. Along with 24/7
digital access to your plan, cash flow, net worth and goals, you
receive insights, real-time visuals and forecasts to help stay on
top of your money and reach your goals. MyAdvisor also connects you
to the expertise of an RBC advisor in your community, via live
video, phone or in-person within a branch. Through interactive
scenario planning, you can see the potential future impact of
today's money decisions on tomorrow's outcome. Whether you're
planning for retirement, saving for your first home, or somewhere
in between, we can help.
SOURCE RBC Royal Bank