Canadians embracing RRSPs, advice

By Steven Lamb | January 4, 2005 | Last updated on January 4, 2005
2 min read

(January 4, 2005) Canadians are planning to contribute more to their RRSPs this year, with an average intended contribution of about $5,560, according to a report from RBC Financial Group.

In its 14th annual survey of investors, RBC found that 65% of Canadians have an RRSP, up from 57% in 2002.

“Canadians have always been diligent about saving for retirement,” said Matt Varey, senior vice-president and director, RBC Investments. “Those who start contributing early and those who invest wisely will likely see the best payoff from their investments.”

Mutual funds remain the investment of choice, with 52% opting for the instant diversification they bring to their retirement fund. But investors seem to be regaining their confidence in the equity markets, with 27% investing in individual stocks, up from 19% last year.

There is an increasing number of investors seeking professional help though, according to the survey, with 73% consulting a financial advisor for at least some of their investment choices. In 2003, only 67% of respondents said they had an advisor.

“Using an advisor is often part of a smart investing strategy,” added Varey. “Advisors can play an important role for the 48%of RRSP holders who need help understanding the different investment choices available to them.”

And it looks like some advice is sinking in. Almost one-third of RRSP investors have already made some or all of their intended contribution for 2004, indicating a plan is in place and they are squirreling away monthly contributions. Fifty-two per cent said they have reviewed their portfolio over the last year, with 41% including their advisor in the process.

The average total market value for personal RRSPs is $64,600 in 2004, up from $58,079 in 2003.

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Steven Lamb