Most Canadians enjoy retirement, but worry good times won’t last, Investors Group survey shows

Many “underlive” in retirement, fearing overspending

  • 80 per cent of recent retirees say their retirement is living up to their expectations
  • 37 per cent of recent retirees are unable to do everything they want in retirement
  • 59 per cent are worried about making their retirement fund stretch for their remaining years

WINNIPEG, April 25, 2016  Retirement is supposed to be a time to do all the things you weren’t able to do when work, family obligations and the many demands and commitments of adult life got in the way. For some, that means spending more time volunteering with their preferred charity. For others, it’s about taking a shot at writing the book they’ve always known they had in them, starting a business or going back to school. Whatever your passions and aspirations, retirement should be low on stress and high on living life to the fullest.

By and large, retirees feel their retirement is on track with what they expected

A study by Investors Group shows that a vast majority of recent retirees are enjoying their retirement, with 80 per cent stating that it meets their expectations.

  • An overwhelming majority of retirees (90 per cent) are spending more time with friends and loved ones
  • 84 per cent are able to spend more time on the hobbies they enjoy

When approaching retirement age, many Canadians may ask themselves what it is they want to spend their time on, based on what’s truly important to them and what kind of lifestyle they’d like to live. While each individual will offer different answers, thinking about those questions early on is at the very core of planning for life after retiring.

“Being reasonable in your retirement expectations is a good thing, but it’s possible to be too reasonable,” says Tim Cottee, Vice President, Retiree Planning, Investors Group. “You might give up on truly meaningful experiences out of the fear of overspending. But this is a risk, too – the risk of underliving.”

Canadians are enjoying retirement, but are anxious about money

Many Canadians share a common concern about making their retirement fund last for as long as they need it. Such anxiety can lead some to “underlive” as they avoid doing things they really want to do and find fulfilling for fear of spending too much money.

“Many retirees pull back on spending far beyond what is required to sustain them throughout their retirement,” says Cottee. “The question is – are they underliving in retirement? You see people put off experiences they’ve dreamed about their entire life, and then they end up with abundant financial resources, but little time or health to achieve their dreams.”

While a smart retirement plan requires prioritization and some tough trade-offs, it shouldn’t be an exercise in self-sacrifice.

  • 64 per cent of retirees find it hard to strike a balance between enjoying retirement and making money last
  • More than half (59 per cent) are worried about making their retirement fund stretch for their remaining years
  • If retirees came into an unexpected sum of money, more than one third (33 per cent) say they would pay off debt and 16 per cent would invest it, suggesting that money is an overriding concern

Canadians working with financial advisors worry less about their nest egg providing for them throughout retirement

A deeper analysis of survey data shows a stark distinction between those who planned for retirement with a financial advisor and those who did it themselves. Seventy-one per cent of respondents who did not work with an advisor felt it was difficult to strike a balance between enjoying retirement and making money last, while only 58 per cent of respondents who used an advisor acknowledged the same concern.

“Making plans based on professional advice can help you avoid overspending or underliving,” says Cottee. “An advisor will support you in making decisions based on fact, not fear and ensure you have access to all the strategies you need to live an enjoyable and rewarding life in retirement.”

About the Survey Methodology

An online survey with 1,004 recent or soon to be retirees (50+) was conducted between February 18th and February 23rd, 2016 using Leger’s online panel Legerweb. The sample was split evenly between those who intend to retire in the next 5 years (n=502) and those who have retired within the past 5 years (n=502). A probability sample of the same size would yield a margin of error of +/- 3.1%, 19 times out of 20.

About Investors Group

Investors Group, founded in 1926, is a national leader in delivering personalized financial solutions to Canadians through a network of approximately 5,300 Consultants located throughout Canada. In addition to an exclusive family of mutual funds and other investment vehicles, Investors Group offers a wide range of insurance, securities, mortgage and other financial services. Investors Group is a member of the IGM Financial Inc. (TSX: IGM) group of companies. IGM Financial is one of Canada’s premier financial services companies with approximately $133 billion in total assets under management as of March 31, 2016.

SOURCE Investors Group Inc.

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April 25, 2016