People living in Vancouver and Victoria will need to work longer than residents of other Canadian cities to retire, according to a report.
The Vancity report, Falling Behind: Retirement Realities in B.C.’s Two Largest Cities, indicates that if people start making the average Canadian RRSP contribution at age 25, it will take them three to four years longer to save for retirement in Vancouver compared with Toronto, or six to seven years longer compared with Winnipeg.
The difference between cities is driven by a higher cost of living, which requires a higher retirement income to maintain a similar lifestyle in Vancouver and Victoria compared to other Canadian cities.
The statistics on RRSP contributions of people under age 45 in Vancouver and Victoria show the following:
- more than 75% do not contribute to RRSPs;
- their RRSP contributors are dropping faster than the Canadian average; and
- their average annual RRSP dollar contribution is dropping.
Without change, retirement may be out of reach for younger British Columbians. Three out of four people under 45 will be unable to retire if they don’t increase their RRSP contributions.
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