Three quarters of Canadians are financially unprepared for retirement
Toronto (5 November 2010) – “While most Canadians view retirement as an opportunity to do the things they really want, three quarters of Canadians are financially unprepared to afford the lifestyle they imagine,” according to the latest quarterly Consumerology Report. The report tracks consumer opinions about the economy, personal financial expectations, consumer buying intention, and attitudes toward key national issues.
The purpose of the most recent study was to explore perceptions and expectations about all facets of retirement. Among the findings, most people would like to retire earlier than they expect to be able to, but only a third of Canadians expect to be retired before 65 and almost one in five expect to be working after age 70. Over 50 per cent of Canadians expect to work in some capacity well into their so-called golden years. This compares to more than three quarters of current retirees havenât worked in any capacity.
The findings have implications for public policy makers and marketers, as a growing number of Canadians expect to work beyond the established retirement age of 65. With an aging workforce, employers will be forced to consider the needs of older employees and ensure the work environment is designed with their needs in mind.
The study found that despite their lifestyle goals, pre-retirement individuals do not have the financial resources in place to sustain those goals, partially explaining why they anticipate continuing to work for income. Strikingly, people make almost no link between their aspirations for lifestyle in retirement and their savings plan. Almost three quarters of Canadians have not calculated what income their current retirement savings will provide during retirement.
Today’s workers also face different challenges in saving for retirement than their predecessors. The majority of people preparing for retirement admit to worrying they will outlive their savings and less than half have any employer sponsored pension plan. As a result, almost all Canadians expect government pensions, OAS and CPP/QPP, to be very important elements of their retirement income. Most homeowners will also be relying heavily on the equity in their home.
The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE