Retirement was cut short for 30% of older Canadians in 2013 due to financial concerns, says a study by ING Direct.
Nearly half of those people (48%), it adds, were forced back to work to bolster their savings. And, in a related study, the bank finds 31% of retirees who return to the workforce often do so because their living costs are also rising.
What’s more, the reality of retirement isn’t often what older Canadians imagined when they were young, says ING. Almost half (45%) concede the costs of living are higher than anticipated. As such, they wish they had saved more in their 20s and 30s (29%), adding they shouldn’t have spent mindlessly prior to retirement (11%).
Advisors can help provide reality checks since, as the survey reveals, most retirees nowadays (40%) says they would have maxed out their annual contributions if they’d had a better understanding of how much they needed to retire.
Another 16% wish they’d had a good financial role model.
The good news, says the study, is more than half of working retirees (58%) predict they’ll be able to leave work once more in five years, though 24% aren’t as hopeful.
A look at Millennials
Most Canadians aged 18 to 34 (64%) are contributing regularly to retirement savings, says a third ING study that centred on young investors.
The only problem is many (69%) aren’t maxing out their annual RRSP contributions, and more than half (61%) aren’t sure how much they need to save.
Nonetheless, they’re motivated to put away funds due to habits handed down by parents (29%), because they know financial plans are effective (22%), or because they see a current retiree struggling (18%).
Most young Canadians polled say retirement will come after age 60: Almost a third (29%) think they’ll retire between ages 61 and 65, while 21% expect to kick back between ages 66 and 70.
They plan to achieve this by avoiding debt (41%), sticking to a plan (37%) and by setting goals (20%), says the study.