JUL 4: BEST FROM THE BLOGOSPHERE
July 4, 2022
HOOPP research shows saving for retirement is a struggle for most
New research from the Healthcare of Ontario Pension Plan (HOOPP) finds that while Canadians view retirement savings as a priority, few are able to do much about it.
A media release from HOOPP outlines some of the key findings of the research, carried out for HOOPP by Abacus Data.
“Saving for retirement is the number two priority amongst Canadians, with 53 per cent citing it (affording the day to day was number one, at 62 per cent), but many are struggling to accomplish it. Thirty-two per cent of working Canadians said they have yet to save anything for retirement, and 38 per cent said they have saved nothing for retirement in the past year,” notes the release.
So, how are people planning to pay for their retirement, if they aren’t saving?
The research found that “nearly half of Canadian homeowners are planning to rely on the sale of a home to set themselves up for retirement (45 per cent), but that plan is becoming increasingly risky in the current environment,” HOOPP reports.
“The general outlook for retirement security in Canada is darkening,” states David Coletto, CEO of Abacus Data, in the release. “Seventy-five per cent of all Canadians agree there is an emerging retirement crisis in Canada and 72 per cent feel that saving for retirement is prohibitively expensive — both up seven points over last year. And if current trends continue, it will be tougher for younger generations.”
David Coletto spoke to Save with SPP a couple of years ago on the issue of millennials and retirement saving.
So if, as the research suggests, the price of housing is so high that there’s no way to get into real estate while also saving for retirement, what’s the solution?
HOOPP’s Senior Vice President of Plan Operations, Steven McCormick, states in the release that the answer may be wider access to workplace pensions.
“Savings challenges are more acute for younger adults, but there is an agreement across generations that an important solution to the problem is better workplace retirement savings plans, and that everyone has a role to play on this front,” states McCormick in the article.
The release notes three interesting findings from the research:
- 82 per cent of Canadians agreed that all workers should have access to a pension that guarantees a percentage of their working income in retirement. Sixty-six per cent are willing to pay for this access themselves by accepting a slightly lower salary in exchange for a better (or any) pension.
- 77 per cent agreed that all employers should be required to contribute in some way towards pensions for all workers, and 74 per cent agree governments could save money by supporting pensions that are more efficient.
- 83 per cent agreed that without good pension plans at work, many Canadian seniors will experience poverty and 77 per cent said workers without pensions will become a burden on the taxpayer.
HOOPP has long been an advocate for retirement income security, and their latest round of research clearly shows that the problem of having enough to live on in retirement is not one that is going away.
If you don’t have a workplace pension plan – and are one of the majority of Canadians who want access to one – take a look at the Saskatchewan Pension Plan, which is open to any Canadian with registered retirement savings plan room.
SPP offers a voluntary defined contribution plan – the money you contribute is pooled for investment efficiency, professionally invested, and – at retirement – can be converted to retirement income, including the option of a lifetime annuity. SPP has been delivering retirement security since 1986. Check them out today.
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Written by Martin Biefer
Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.