Half (51 per cent) of Canadians are planning to contribute to their registered retirement savings plans this year — a substantial increase since last year (18 per cent), according to a new survey by Edward Jones Canada.
The survey, which polled more than 1,600 adults, found half (51 per cent) said cost of living is their most significant barrier to saving for retirement, followed by income (19 per cent) and debts (14 per cent). However, these challenges haven’t impacted respondents’ ability to contribute to their RRSPs, as the percentage of those unable to afford to do so dropped from 29 per cent in 2022 to 16 per cent this year.
Among respondents who contribute to an RRSP, nearly a quarter (23 per cent) said they plan to contribute the maximum amount, with respondents between the ages of 18 and 34 and 35 and 54 more likely (22 per cent and 23 per cent, respectively) to contribute to their RRSP this year. These age groups were also more likely (17 per cent and 15 per cent, respectively) to contribute the maximum amount compared to last year.
Still, when asked to describe how they felt about their current financial situation, just a third (33 per cent) of respondents said they’re happy with the current state of their finances, while half (50 per cent) said they’re nervous and 14 per cent said they’re fearful.
Additionally, 43 per cent of respondents said they believe in having a combination of an RRSP and other investment options. Just 19 per cent said they believe an RRSP alone meets their saving and investing needs and 12 per cent said they prefer other investment options altogether, such as a tax-free savings account (51 per cent), real estate (11 per cent) and non-registered investment accounts (10 per cent). Notably, those aged 18 to 34 were 11 per cent more likely to use or consider real estate investments despite market conditions such as rising interest rates and inflation.
“The data highlights the important fact that there is no such thing as a one-size-fits-all approach to investing,” said Julie Petrera, Edward Jones’ senior strategist of client needs, in a press release. “Canadians are all different and their needs are constantly changing. These account types offer various benefits and restrictions both immediately and longer term.”