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Alberta boomers worry their savings won't last through retirement
- TD Waterhouse Boomer Happiness Index also shows only 7% of Alberta boomers feel 'very well-prepared' for retirement -
CALGARY, Jan. 5 /CNW/ - While the majority (82%) of Alberta boomers say they are happy, their feelings change when thinking about retirement. Seventy-eight percent say they worry that they won't have enough money to last through retirement, and only 7% say they feel very well-prepared. This is according to the TD Waterhouse Boomer Happiness Index, which polled boomers (ages 45-64) to determine their emotional and financial state heading into retirement.
Money doesn't buy happiness, but it appears that having a financial plan does.
The report found that Alberta boomers' concerns about money are warranted: only 42% have a financial plan in place for retirement. The Index also found a correlation between having a financial plan and happiness levels: when thinking about the fact that they are retired or approaching retirement, Canadian boomers who have a financial plan are more likely to feel happy (55% versus 31%) or relieved (37% versus 22%) than those without.
"I'm not surprised that Alberta boomers don't feel financially prepared for retirement: less than half have a financial plan in place. Most Canadians recognize the importance of planning ahead to ensure that they are financially ready when they stop working, but they need to start saving early," says Crystal Wong, TD Waterhouse Financial Planning Senior Regional Manager in Calgary. "It's essential to create a comprehensive, written financial plan - and stick to it."
Not surprisingly, the TD Waterhouse Boomer Happiness Index showed that boomers across Canada who have a financial plan are significantly more likely to feel prepared for retirement than those without (82% versus 35%).
Albertans most likely to work during retirement
So much for relaxing and enjoying their golden years: Albertans are among the most likely in the country to work during their retirement to supplement their savings (46% versus 39% nationally). The top three ways Albertan survey respondents plan to fund retirement are: Old Age Security and Canada Pension Plan (72%), RRSPs (70%) and company pensions (49%).
Alarmingly, nearly one-third (31%) of Albertans say that they are relying on winning the lottery. While this statement may be tongue-in-cheek, across Canada this group is less likely to have a financial plan, and more likely to be anxious about retirement and feel behind in their savings.
Albertans worry about maintaining current standard of living in retirement
Alberta boomers are among the most likely in the country to say that their top fear about retirement is maintaining their current standard of living (77% vs. 67% nationally). The top concerns are having enough money to last through retirement (78%), maintaining their current standard of living after retirement (77%) and keeping healthy and active (76%). While these concerns aren't all financial in nature, retirement anxieties may be alleviated by planning ahead and seeking the advice of professionals who can help develop a plan that takes into consideration your personal circumstances and goals, as well as help you offset risks.
And it's not just about achieving a target amount of savings before retirement. "As your retirement draws closer, speaking with a financial advisor about creating a clearly-defined financial plan will help you compare your current and future sources of income against your expenses," says Wong. "An accredited financial advisor can help you build sound financial strategies to reduce taxes as well as work to minimize the effects of market and financial risks throughout your retirement years, so your money is there when you need it. A comprehensive financial plan will also include strategies for transition of wealth and estate planning: key elements in a retirement plan."
Passing on wisdom: helpful tips from those with experience.
The top pieces of advice Alberta boomers and pre-boomers (ages 65-74) have for the next generation are: start saving earlier (90%), pay off your mortgage faster (62%) and save more or invest more in an RSP (60%). Alberta survey respondents are the most likely in the country to advise people to develop a financial plan and not focus solely on savings (69% vs. 57% nationally).
"I agree with the top piece of advice being start saving earlier. I tell boomers not to procrastinate. Given that those with a retirement plan in place are happier than those without, it makes sense both financially and emotionally to seek the help of a qualified advisor who can coach you through the process," says Wong. "Even do-it-yourself investors can gain valuable insights from a second opinion."
About The TD Waterhouse Boomer Happiness Index
The TD Waterhouse Boomer Happiness Index polled boomers (age 45-64) and pre-boomers (age 65-74) through a custom, online survey. The survey was conducted by Environics Research from December 2 -7, 2010, and polled 1,000 Canadians including 110 Albertans.
About TD Bank Group
The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Group (TD or the Bank). TD is the sixth largest bank in North America by branches and serves approximately 19 million customers in four key businesses operating in a number of locations in key financial centres around the globe: Canadian Personal and Commercial Banking, including TD Canada Trust and TD Insurance; Wealth Management, including TD Waterhouse and an investment in TD Ameritrade; U.S. Personal and Commercial Banking, including TD Bank, America's Most Convenient Bank; and Wholesale Banking, including TD Securities. TD also ranks among the world's leading online financial services firms, with more than 6 million online customers. TD had C$620 billion in assets on October 31, 2010. The Toronto-Dominion Bank trades under the symbol "TD" on the Toronto and New York Stock Exchanges.
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