Although a significant number of Canadians believe that $1-million is enough savings to retire on, IG Wealth Management says this figure is a myth, and that nearly two thirds who believe this may be misguided by outdated information. A similar survey conducted by BMO Financial Group found, on average, that Canadians now believe they will now need $1.7-million to retire.
In the IG survey of 1,507 Canadians over age 18 but who are not yet retired, conducted in the first week of January 2023, researchers found that 63 per cent believed that $1-million in savings is enough to retire on comfortably. Conducted in partnership with Pollara Strategic Insights, the survey further found that nearly half think they will be able to retire comfortably just by focusing on investing in a Registered Retirement Savings Plan (RRSP).
“It’s surprising that so many Canadians believe $1-million in savings is enough for retirement, considering many don’t know what their cost of living will be once retired,” says Christine Van Cauwenberghe, head of financial planning with IG Wealth. One third of those surveyed said they did not know what percentage of their current income they would need to cover expenses in retirement.
“Generally speaking, the amount one needs to retire comfortably will depend on a variety of factors,” she adds. “Unfortunately people are often misguided by outdated information.”
A slightly earlier survey, also conducted by Pollara, this time surveying 1,500 adult Canadians in early November 2022 for BMO’s 13th annual retirement study, uncovered the $1.7-million figure, and also found that only 44 per cent of Canadians are confident they will have enough money to retire as planned. The average amount held in RRSPs nationally, they say, is just $144,613, a two per cent increase over the 2021 reported average of $141,923.
