More than 60 per cent of Canadians are concerned they’ll outlive their retirement savings and 45 per cent don’t feel confident they’ll be able to afford the post-work lifestyle they want, according to a new survey by RBC Insurance Services Inc.
The survey, which polled 1,000 Canadians aged 55 to 75, also found respondents use a variety of tools to save for retirement, with registered retirement savings plans (45 per cent), cash (43 per cent) and tax-free savings accounts (39 per cent) ranking the highest. Annuities aren’t widely used, with only 12 per cent of respondents using or planning to use this option, according to the survey.
“Canadians are living longer than in years past, and they want active and productive lifestyles in retirement,” said Jean Salvadore, director of wealth insurance for RBC Insurance, in a news release. “However, some are better prepared for retirement than others. Having sufficient retirement savings is critical, and Canadians should consider a combination of tools and a well-diversified retirement plan to ensure they have enough money to stretch over decades.”
The worry of outliving retirement savings is a concern for solo retirees as well, according to a survey by TD Bank Group. Some 2,500 Canadian adults responded to the survey, 699 of whom are older than 40 and single, widowed, divorced, separated or never married. Of that cohort, 456 said they plan to live alone in retirement.
The TD survey found 47 per cent of respondents are worried about outliving their retirement savings, with concerns ranging from increasing daily living expenses (63 per cent), not having enough money for necessities (41 per cent) and rising health-care costs (39 per cent).
More than a third (39 per cent) of respondents who plan to live alone in retirement said they feel at a disadvantage compared to dual-income couples, and 46 per cent said they struggle to save for retirement while covering day-to-day expenses on their own.
“Facing retirement alone is becoming increasingly prevalent, but what is striking in these findings is the high level of anxiety that comes with this trend,” said Rowena Chan, senior vice-president at TD Wealth Financial Planning, in a press release. “Canadians planning to retire solo are acutely concerned about whether they are saving enough to meet the wide spectrum of costs they will encounter in their older years — from day-to-day living expenses to providing enough for their own care in the event of illness.
“For those relying on a single income to fund their retirement, it’s critical to think beyond day-to-day financial obligations and plan accordingly for the future,” she added.