Young Canadians Understand Importance of Retirement Savings

In fact, 61% of the respondents said they plan to invest some for retirement in the next 12 months, according to a news release. Those who do contribute to Registered Retirement Savings Plans (RRSPs) said they do so for the long-term savings and not for the immediate income tax benefits it offers.

The survey also found that turning 25 seems to be the trigger for retirement investing. Fifty-four percent in the 25-29 age group have already contributed to an RRSP, while only 23% in the 20-24 age group have already done so.

The young Canadians invest in an RRSP every two years, but their investments are modest. Forty percent of them have invested less than $2,500 to date, though the realistic annual amount that they judge necessary to ensure nice retirement years is $2,775.

“Young people dream of traveling, having kids, but also about investing for retirement. They have a positive image of people who invest in RRSPs. This is good news. However, the actual amounts invested by young people are rather modest and might not be sufficient to ensure the retirement of their dreams. It is essential to continue to raise the awareness of this issue among young adults in order to prevent them from ending up ‘poorly retired’, since 30% of them admit that they do not know how to invest in a RRSP,” said Stéphane Gagnon, Vice-President, Marketing at Laurentian Bank, in the release.

The Ipsos Descarie / Laurentian Bank survey of 1,304 respondents aged 20 to 29 was conducted between December 7 and 14, 2005, in the Province of Quebec.