Canadians now expect to need $1.7 million to retire, up 20% from 2020, a BMO survey found

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Canadians consider they are going to need to save up to $1.7 million to retire, up 20 p.c from 2020, in accordance to analysis launched Tuesday by BMO Monetary Group.

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“While the headwinds expected in 2023 will naturally raise concerns about how inflation and interest rates will affect our finances, Canadians remain resilient and are taking proactive steps to protect and invest in their retirement nest egg,” stated Nicole Ove, head of retail investments at BMO.

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In accordance to the report, Canadians are prioritizing retirement financial savings as each contributions and account balances are rising year-over-year. The nationwide common quantity held in a registered retirement financial savings plan (RRSP) rose two per cent to $144,613 in 2022, whereas almost half of Canadians stated they contributed to their RRSP for the tax yr.

Though they consider they need to save extra money, solely 44 per cent of Canadians are assured they are going to have sufficient to retire as deliberate, the examine found. This determine represents a lower of 10 p.c from 2020.

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When it comes to saving for retirement, the survey reveals that Canadians have combined outlooks, with 22 per cent planning to retire between the ages of 60 and 69 with a median age of 62.

Of those that skilled a main occasion for the reason that begin of the pandemic, comparable to beginning a household, transferring home or beginning a enterprise, 20 p.c confronted a lack of revenue and 9 p.c had a bigger cost.

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The examine says 69 per cent of Canadians consider the state of the economic system has affected the quantity they save, and 60 per cent say it has affected the cash they make investments.

Ou stated Canadians can flip to monetary advisors to assist them concentrate on their monetary objectives throughout disruptions, main life occasions and uncertainties.

The BMO survey, performed by Polara Strategic Insights, surveyed 1,500 grownup Canadians on-line between November 4 and seven, 2022. The margin of error for a likelihood pattern of this measurement is ±2.5 p.c, 19 out of 20.

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