Most Canadians plan to keep investing at least as much in registered retirement savings plans (RRSPs) as they did last year, despite recent volatility in North American and global stock markets, according to a survey by Investors Group.
Eighty-three per cent of Canadians who plan to invest said they will increase or match their 2010 RRSP contribution, up slightly from the 79 per cent of Canadians who reported similar intentions last year. And three-quarters (76 per cent) of Canadians said they have an RRSP or plan to open one in the coming year, found the survey of 2,829 adults.
Among those who said they don't plan to invest, concern about stock market volatility remains about the same, at 10 per cent compared to nine per cent last year.
"Canadians have used RRSPs as the cornerstone of their personal investment and savings plan for many years and it is encouraging to see this level of continued commitment," said Jack Courtney, assistant vice-president of advanced financial planning at Investors Group. "Keeping your long-term objectives in mind is very important when making investing decisions and a personal financial plan is a definite asset in that regard."
Canadians who have a financial plan are more likely to already have or intend to establish an RRSP (88 per cent), compared with those who do not have a financial plan (64 per cent). They are also more likely to already have or plan to start a tax-free savings account (TFSA), at 78 per cent compared to 58 per cent.
TFSA ownership in Canada has reached the 50 per cent mark, up from 45 per cent last year and 25 per cent in 2009 when the TFSA was introduced, according to the survey. Of those who still do not have a TFSA, 25 per cent said they plan to open one in 2012 — the same as last year.
Young Canadians catching up
While young Canadians (aged 18 to 29) continue to trail baby boomers (aged 45 to 64) in RRSP ownership, they appear to be more aggressive in their investment intentions, said Investors Group. Fifty-four per cent of gen-Y Canadians said they own an RRSP or plan to open one in the next year, compared to 83 per cent of boomers. But many more younger Canadians plan to increase their RRSP contribution (48 per cent) compared to their boomer elders (27 per cent).
Among young Canadians who are not planning an RRSP investment, a majority said they don't have money to invest after paying their bills (64 per cent). But 22 per cent said they have decided to pay down their mortgage and other loans instead of investing.
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