Canadians reluctant to invest, Tangerine survey suggests

Are we, as a nation, a bit on the fence about whether to wade into investing – or to just stash cash in a safe savings account?

A new survey from Tangerine Wealth, posted on the Toronto Star website, suggests just that.

According to their media release, “nearly half of Canadians (48 per cent) are holding back money they could be investing, with market uncertainty emerging as a key reason many remain on the sidelines.”

“The survey suggests Canadians aren’t avoiding investing altogether, but many are struggling to find the right balance between saving and investing. Among those setting money aside instead of investing it, nearly one-quarter (24 per cent) have parked $25,000 or more, often in chequing or savings accounts,” the release continues.

How come? Let’s read on.

“Many Canadians are weighing the value of keeping money within reach today against the opportunity to grow it for tomorrow,” states Aharon Kagedan, Managing Director, Wealth at Tangerine, in the release. “Holding cash can make sense for short-term needs, but when it aligns with their goals and comfort with risk, investing has the potential to turn those savings into real momentum over time,” he states.

Here are the key findings from the research, as set out in the release:

• “Among those who had money they could have invested, two-thirds (65 per cent) set at least some of it aside, with a quarter (25 per cent) setting aside most or all of it. Only 15 per cent say they invested all of it.”
• “Many are sitting on significant amounts of uninvested cash. Among those holding back funds, nearly one-quarter (24 per cent) have set aside $25,000 or more, and 13 per cent have set aside $50,000 or more.”
• “Market uncertainty is keeping many Canadians on the sidelines. Nearly one in five (19 per cent) of those who set money aside cite market volatility, while 17 per cent worry about losing money and 12 per cent believe markets are currently too high.”
• “Half (51 per cent) of Canadians feel confident making investment decisions today, with younger Canadians reporting more confidence than older ones. 19 per cent of those aged 55 to 65 say they are not confident at all.”

The release concludes by suggesting those who are hesitant about investing should make use of online tools (the release highlights the bank’s tools) or seek professional advice for direction.

For sure it doesn’t make a ton of sense to have tens of thousands of dollars sitting in a basic chequing or savings account where it will earn little to no interest.

Such “idle” money might be better put to work for your future. Did you know that contributions to the Saskatchewan Pension Plan are treated the same as registered retirement savings plan contributions for tax purposes?

You’ll receive a tax deduction for contributions you make to SPP. At the same time, those contributions will be invested for you in SPP’s low-cost, diversified, professionally managed pooled funds. There will be no tax charged on the growth of your SPP contributions.

It’s when you turn those savings into future retirement income – options include a lifetime monthly annuity payment or the more flexible Variable Benefit – when taxes will apply.

Check out SPP today!

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