Young and RRSP-less No More: RBC Poll
Canadians between ages of 18 and 34 ramping up RRSPs; Shifting top financial priorities now include retirement savings
TORONTO, January 19, 2012 The 22nd Annual RBC RRSP Poll finds that 43 per cent of Canadians between the ages of 18 and 34 now hold RRSPs. This represents a shift from last year, when the number of younger Canadians holding RRSPs dropped to its lowest point in almost a decade (39 per cent). In addition, retirement savings has moved up to fourth place on the list of financial priorities for this age group, compared to its seventh place position last year.
What has slipped significantly for the 2011 tax year is the percentage of younger Canadians who plan to contribute the maximum to their RRSPs. In the 2010 tax year, young Canadians were the most likely age-group to maximize their RRSP contribution (33 per cent); for the 2011 tax year, they are the least likely to do so at 16 per cent (compared to 25 per cent of all Canadians).
"Younger Canadians have any number of competing 'here and now' financial needs, in addition to trying to save for their future goals." advised Jason Round, head, Financial Planning Support, RBC Financial Planning. "We want to ensure young Canadians know all the options available to help them. The tax-sheltering benefits of RRSPs can help to buy your first home and grow your money for future goals. Contributing to an RRSP also helps to reduce your taxable income today."
The RBC RRSP poll indicates that financial priorities are shifting among younger Canadians. Compared to 2010, more young Canadians are focusing on home ownership (49 per cent compared to 44 per cent) and retirement savings (35 per cent compared to 26 per cent). A lower priority is being placed on regular payments to reduce or eliminate debt (48 per cent compared to 56 per cent) and general savings for a rainy day (39 per cent compared to 45 per cent).
"Trying to take care of day-to-day expenses, save up for that first home and put aside money for future goals, such as retirement, may feel overwhelming, but it can be done if you set your priorities and make informed decisions," added Round. "It doesn't cost anything to go online and check out some of the resources available for saving and investing or first time home buying, or to meet with an advisor who can help you achieve your financial goals."
|RRSP Fast Facts for the 2011 Tax Year||Young Canadians|
|Have an RRSP||43%||60%|
|No withdrawals from RRSP in the past year||88%||80%|
|Contribute through a regular contribution plan|
|Plan to make the maximum allowable contribution|
|Contributing the same amount as last year||41%||52%|
|Contributing more than last year||35%||27%|
About the 22ndAnnual RBC RRSP Poll
This survey was conducted by Ipsos Reid between October 24 and November 15, 2011 via interviews of 4,135 Canadian adults, including a random sample of 1,224 adults in the general population (aged 18 and over) and 2,911 Boomers aged 50-69 with household financial assets of $100,000 or more. The results are based on samples where quota sampling and weighting are employed to balance demographics and ensure that the sample's composition reflects that of the actual population according to Census data. Quota samples with weighting from the Ipsos online panel provide results that are intended to approximate a probability sample. A weighted probability sample of 1,224 Canadian respondents, with 100 per cent response rate, would have an estimated margin of error of ±3 per cent, 19 times out of 20. Data for 2,911 Boomers are unweighted with a margin of error of ±2 per percentage points, 19 times out of 20.
About RBC's financial planning advice, resources and interactive tools
The RBC Advice Centre offers free online advice, resources and tools regarding RRSPs - including the RSP-Matic® Savings Calculator and updates on the federal government's RRSP First Time Home Buyers' Plan. Whether Canadians want to save and invest, buy their first home, get more from their day to day banking, protect what's important, or take care of their businesses, the RBC Advice Centre can help answer their questions. Interactive tools and calculators provide customized information covering many facets of personal finance. With the guidance of RBC advisors who are available to chat live, Canadians have access to free, no-obligation professional advice about RBC products and services and personalized one-on-one service. Further information is available at rbcadvicecentre.com.
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