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B.C. boomers feel least prepared for retirement
- TD Waterhouse Boomer Happiness Index shows only 32% of B.C. boomers have a financial plan for retirement -
VANCOUVER, Jan. 5 /CNW/ - While the majority of B.C. boomers (88%) state that they are very happy (28%) or somewhat happy (60%), compared to the rest of Canada, they feel the least prepared for retirement. Over half (57%) of boomers in B.C. stated they feel unprepared, compared to 42% nationally. In fact, according to the TD Waterhouse Boomer Happiness Index, which polled boomers (ages 45-64) to determine their emotional and financial state heading into retirement, 79% in B.C. worry that they won't have enough money to last through retirement.
Money doesn't buy happiness, but it appears having a financial plan does.
Boomers' concerns about money are warranted - only 32% 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 one.
"It's concerning that less than a third of B.C. boomers have established a comprehensive plan for achieving a financially-secure retirement," says Jillian Bryan, an Investment Advisor with TD Waterhouse in Vancouver. "Formulating a plan for how you are going to manage your money to last your lifetime takes careful, thoughtful execution. Getting an early start on planning, saving and investing for retirement is even more critical now than ever before - we can't afford to ignore it."
Are B.C. boomers counting on a winning lottery ticket?
The top three ways B.C. boomers plan to fund their retirement are through: Old Age Security and Canada Pension Plan (70%), RRSPs (61%) and company pensions (41%).
However, B.C. survey respondents feel like they are playing catch-up: the majority (64%) feel behind in their retirement savings compared to their peers. Forty-six per cent say they will keep working to fund their retirement, and alarmingly, more than a third (36%) are hoping to win the lottery, making them among the most likely in the country to be relying on this method to fund their retirement (vs. 32% nationally). And while winning the lottery may be a tongue-in-cheek response, according to the survey results, this group is less likely to have a financial plan and more likely to feel anxious about retirement.
What's keeping boomers up at night?
When thinking about retirement, the top fears voiced by boomers were: not having enough money to last through retirement (79%), maintaining their current standard of living (75%) and keeping healthy and active (71%). 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.
Most Canadians recognize the importance of planning ahead to ensure that they are financially ready when they stop working. 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 retirement income plan will help you compare your current and future sources of income against your expenses," says Bryan. "An 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."
Passing on wisdom: helpful tips from those with experience.
The top three pieces of advice that B.C. boomers and pre-boomers (ages 65-74) recommend for the next generation are: start saving earlier (87%), save more money or invest more in an RSP (68%) and pay off your mortgage faster (63%).
"I agree that the most important tip is to start saving earlier: don't procrastinate," says Bryan. "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. 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 120 people in British Columbia.
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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