Canadian workers could need almost $2 million to retire

New survey suggests a lack of confidence in pension, retirement plans

Canadian workers could need almost $2 million to retire

Looking to retire this year? Well, you might need $1.7 million in savings.

A new report from BMO found that working Canadians now believe they’ll need close to $2 million stashed away in retirement funds, a 20% increase from 2020. What’s more, less than half of Canadians think they’ll have enough money to retire as they planned.

BMO's 13th annual Retirement Study found that employees are now making retirement savings a main priority in 2023, in the face of inflationary hikes and a cost of living crisis.

"While the anticipated headwinds in 2023 will understandably prompt concerns about how inflation and interest rates will affect our finances, Canadians remain resilient and are taking proactive measures to protect and invest in their retirement nest egg," says Nicole Ow, head of retail investments at BMO.

With inflation hitting a four-decade high in late 2022, employees are understandably concerned about their futures. Whether or not these rising costs and living crisis concerns will put people off retiring is yet to be seen – however, according to BMO’s data, 59% of workers think inflation will affect their retirement goals, with 74% of employees now officially concerned about the economy.

Almost nine in 10 (88 per cent) Ontarians feel more needs to be done to encourage people to save for retirement, according to the Financial Services Regulatory Authority of Ontario (FSRA).

Offering older employees the option of semi-retirement should be a smart way for organizations to manage labour shortages, found another survey.

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