Bleak mid-winter: millions of Canadians could face an economic shock

And two in five over 55s say they can't afford to save for retirement

Bleak mid-winter: millions of Canadians could face an economic shock
Steve Randall

February is meant to be a more positive month as long-awaited pay cheques arrive, and spring is edging closer. But for many Canadians, optimism around finances is hard to find.

A new survey from the Angus Reid Institute has found that those over 55 are concerned about their retirement savings, with two in five saying they cannot afford to contribute to an RRSP or TFSA right now due to the financial situation.

One in ten say they are contributing the maximum amount to their TFSA or RRSP in a typical year while around one-in-five are contributing less than half of their allowable limit. Many Canadians under 44 don’t contribute to a TFSA or RRSP, despite being in the prime of their working lives as they feel the pressure from the effects of inflation and high shelter costs.

Meanwhile, half of under 55s are concerned that they could lose their job if the economy worsens, far above the three in ten of over 55s who were worried.

While those nearing retirement have at least had some warning that the day would come, many under 55 say they would struggle with an unexpected bill of any size – ranging from less than one fifth of under 35 men or women, to 25% of women aged 35-54 (compared to just 14% of men in this age group.)

Around one fifth of respondents said they could only manage an unexpected bill of up to $250, one third said they could manage one of $500-$1000 (although this drops to 22% among women 55+) while more than half of men and women over 55 said they could cope with a bill over $1000 that they hadn’t expected compared with around one third of under 55s.