COVID has impacted Canadians' retirement readiness

Poll findings reflect how pandemic has extended and reshaped Canadians’ path to financial freedom, outlook on life after work

COVID has impacted Canadians' retirement readiness

New survey data released by the Canadian Institute of Actuaries (CIA) confirms what many Canadians and their advisors have been seeing for the past year: the pandemic has transformed the way Canadians are thinking about retirement.

Drawing from Ipsos survey data collected in July and August 2020, the research covered a sample of more than 1,500 Canadians aged 18 and older. Participants were asked about their retirement risk concerns and preparedness, their understanding of longevity and life in retirement, and how well their expectations around needing long-term care have matched up with reality, particularly against the backdrop of COVID-19.

Among those who either were not retired or had spouses who were still working, 23% said the pandemic has impacted their or their spouse’s retirement timeline; within that group, 69% said they or their spouse will spend more years working than expected in order to keep receiving income. More broadly, 40% of non-retired Canadians said they did not know when they will retire, and an additional 14% said they have no expectations of ever retiring.

Just over a third (36%) of all respondents said they earned less household income because of the pandemic; related to that, a quarter of participants (25%) said COVID-19 has pushed them to take on additional debt. Among retirees, nearly one in five said they had less than $25,000 in savings and investments, while more than half of Canadians said they have no financial plan for their retirement.

Touching on respondents’ attitudes toward long-term care, 63% said that they saw assisted living facilities in a more negative light as a result of the COVID-19 pandemic. Nearly half of Canadians (47%) rated long-term care availability as fair to poor; 55% assessed its quality as fair to poor; and 49% rated their ability to afford it as fair to poor.

Overall, 67% of Canadians surveyed said they haven’t done anything to plan for their long-term care needs.

“Understanding and planning for the financial risks of retirement – whether related to income, savings, health care costs, or other expenses – is something all Canadians need to do to ensure their safety and comfort in the future,” said CIA President Jacqueline Friedland, FCIA. “These survey results show that Canadians need a lot more support and information to protect themselves in their old age.”