Are your clients dipping into their RRSPs?

Canadians are increasingly willing to take money from their RRSPs to pay off expenses, says a recent Scotiabank poll.

While the top reason for withdrawing money was to buy a first home (40%), the number of withdrawals overall is on the rise. One-third of RRSP holders (36%) reported taking out funds this year, up from 23% in 2005.

Read: TFSA or RRSP, what’s the right choice?

The survey also finds:

• The average amount Canadians withdrew $24,531 from their RRSP in 2012, more than double the amount taken in 2005.
• 14% take money out of their RRSPs to cover day-to-day living expenses, and 6% took money out to pay for vacations.
• Canadians age 50 and up are most likely to withdraw money from RRSPs

Read: Best ways to mature RRSPs

“If Canadians are going to take money out of their RRSP for a major purchase like a house, they need to have a plan in place to return that money as soon as possible,” says Bev Moir, a ScotiaMcLeod wealth advisor.

Read: Why clients must pay back RRSP withdrawals

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.