A new poll found that Canadians are planning to put money away in their nest egg, but the probability of that taking place is quite low. Most respondents said they will put money into their RRSP, Tax-Free Savings Account (TFSA) or both. Can it be done?
The Canadian Imperial Bank of Commerce (CIBC) released the findings of its latest study that found 60 percent of Canadians say they will invest in their retirement this year. More than one-quarter (28 percent) will contribute to both an RRSP and a TFSA, 19 percent will opt for the RRSP and 13 percent will only save into a TFSA.
One of the key conclusions made from the study was that many of these individuals who plan to save money this year won’t. CIBC made this statement based on research from previous years. Last year, for instance, 35 percent said that not having enough money was the primary hindrance from contributing to their retirement savings.
Nonetheless, some respondents were honest with their situation. Less than one-third (31 percent) conceded that they will not make any deposits into their RRSP, TFSA or general savings account, according to the Harris-Decima survey. This number is up from 28 percent a year ago.
“While it's positive that so many eligible Canadians plan to contribute towards their retirement this year, we know from previous years that only 26 per cent of eligible tax filers actually made a contribution to their RRSP but our data shows 47 per cent say they intend to contribute to their RRSP," said Jamie Golombek, Managing Director of Tax & Estate Planning at CIBC, in a press release.
"If you don't have the money to make a contribution to your retirement savings, the solution may come from having a hard look at your budget. Saving for retirement is really about delaying some consumption from the present to the future."
More than 60 percent of respondents who plan to save this year resided in Manitoba, Saskatchewan (65 percent), Alberta (65 percent), Ontario (63 percent) and British Columbia (60 percent). The least likely were residents in Atlantic Canada (58 percent) and Quebec (53 percent).
The telephone survey was conducted with 1,740 Canadian adults between Dec. 13, 2012 and Jan. 7, 2013. It contains a margin of error of +/- 2.35 percentage points.