Canadians unsure about RRSP, don't ask for help

Canadians unsure about RRSP, don't ask for help

Canadians unsure about RRSP, don Almost two thirds of Canadians don’t get expert advice to plan for their retirement despite being unsure of the best options.

Two in five Canadians polled by CIBC say they see “no point” in investing in an RRSP with two thirds saying that a TFSA is a better choice because it’s completely tax free.

Jamie Golombek, managing director, Tax & Estate Planning, CIBC Financial Planning and Advice, says that an RRSP should still be the primary retirement savings vehicle for most people but he understands why there is reluctance.

"Several myths about RRSPs have been circulating in recent years, which are unfairly giving them a bit of a bad rap and Canadians are asking if an RRSP is still the way to go," says Golombek. "While everyone's retirement needs will be different, it's important to take the time to build a retirement plan to ensure you have sufficient funds to live the lifestyle you want, cover unexpected expenses such as health or care costs, or leave a legacy for heirs."

Just 51% of respondents said an RRSP was their main retirement savings vehicle and 54% aren’t sure about tax implications if they or their spouse dies.

Nearly 2 in 5 are not planning to make RRSP contributions and 19% are not sure if they should or not.

Danger from not seeking advice
Around a third of respondents to CIBC’s poll said that they get professional advice about retirement savings with almost as many planning on their own and 1 in 5 asking friends and family.

"The danger comes in not seeking advice from a qualified financial advisor or planner, and instead relying on misinformation and cocktail party banter to make important financial decisions," says Golombek.

Percentage of Canadians who have or expect the following sources of retirement income:
  All Canadians 18-34 35-54 55+
Government pension/benefits (e.g. CPP, QPP, OAS, GIS) 57 % 39 % 53 % 77 %
Registered Retirement Savings Plan (RRSP) 51 % 50 % 48 % 55 %
Employer sponsored pension 34 % 29 % 29 % 44 %
Tax-Free Savings Account (TFSA) 32 % 43 % 23 % 35 %
Equity in home 19 % 14 % 17 % 26 %
Non-registered investments 18 % 20 % 14 % 22 %
Inheritance 11 % 14 % 11 % 9 %
Real Estate Investments 8 % 12 % 7 % 7 %
Rental Property Income 7 % 10 % 6 % 5 %
Lottery 4 % 7 % 4 % 3 %
Other 4 % 3 % 2 % 5 %
I don't know 13 % 18 % 18 % 4 %

Percentage of all Canadians who have a RRSP/RRIF or spousal RRSP/RRIF:
  All Canadians 18-34 35-54 55+
Yes 60 % 49 % 61 % 67 %
No 40 % 51 % 39 % 33 %

Top sources for advice about saving for retirement among all Canadians:
  All Canadians 18-34 35-54 55+
Family and/or friends 22 % 40 % 16 % 12 %
Financial expert/professional (NET) 35 % 26 % 31 % 47 %
  Financial planner 20 % 15 % 17 % 29 %
  Professional Investment Advisor 15 % 12 % 13 % 21 %
  Accountant 8 % 6 % 8 % 9 %
Other 6 % 5 % 5 % 7 %
No one - I do it myself 31 % 19 % 35 % 37 %
I haven't thought about retirement 17 % 27 % 22 % 4 %

Number of Canadians not currently retired or semi-retired who plan to make an RRSP contribution for the 2017 tax year:
  All Canadians 18-34 35-54 55+
Yes, I have already made my entire contribution 10 % 11 % 8 % 12 %
Yes, I contribute monthly/regularly 21 % 17 % 26 % 12 %
Yes, I plan to contribute before the March 1, 2018 deadline 11 % 12 % 10 % 15 %
No, I'm not making a contribution 39 % 40 % 36 % 43 %
I'm not sure yet 19 % 20 % 19 % 19 %

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