Canadian Preretirees Lack Retirement Confidence

Twenty-four percent of Canadian preretirees (working, ages 50 to 65 with at least $50,000 in investible assets) are not confident that they will be able to live comfortably in retirement, and about half of Canadian preretirees expect to have a lower standard of living compared with their existing lifestyle, according to a new study by LIMRA.

This is similar to LIMRA research of preretirees in the U.S., which found that less than half of preretirees (ages 55 to 70 and not retired) felt confident they will be able to live their desired lifestyle in retirement. 

The current study found that while seven in 10 preretirees in Canada have a dollar amount in mind that they will need to have saved or invested to ensure living comfortably in retirement, few (7%) have formal written plans. In addition, one quarter of preretirees have never saved regularly for retirement, and one-quarter remain uncertain when they can retire.

According to the survey, the majority of preretirees in Canada have neither estimated the amount of guaranteed income they will need in retirement nor the income they will receive in retirement.

“Without a clear understanding of their expenses in retirement or the income they can expect to receive, preretirees will not be able to develop a credible retirement plan and ensure a secure financial future,” said Sally Bryck, associate research director, LIMRA Retirement Research. She added that financial advisers can play an important role in helping preretirees as they prepare for retirement.