New poll outlines the reasons why most Canadians aren’t investing their money
According to a poll from Investor's Edge, the direct investing division of CIBC, only 48 percent of Canadians invest money annually.
The survey also reveals that while 56 percent of respondents are comfortable investing their own money, this confidence increases to 75 percent among current investors.
However, only about half of the respondents (51 percent) view themselves as knowledgeable about investing, with this figure rising to 68 percent among investors.
A significant portion of Canadians who hesitate to invest cite a lack of knowledge (65 percent) and fear of losing money (57 percent) as major deterrents.
This uncertainty extends to current investors as well, with 38 percent unsure of what ETF stands for and 42 percent unfamiliar with the concept of dollar cost averaging.
Luka Marjanovic, managing director and head of CIBC Investor's Edge, emphasizes the importance of starting early despite gaps in knowledge.
“Knowledge is power in investing, but the good news is that you don't need to know everything to get started. In most cases, investing prudently and early is more important than having a perfect plan,” Marjanovic explains.
He highlights that having the right tools can motivate prospective investors to begin making their money work for them.
The poll also indicates a strong desire for knowledge among Canadians, with 79 percent acknowledging the importance of knowing how to invest and the same percentage believing that more information or advice on current investment trends would boost their confidence.
Additionally, 73 percent express a willingness to learn more about investing.
Marjanovic points out the necessity of educational resources in today's economic climate. “With living costs rising sharply in recent years, it's more important than ever that we bridge those educational gaps for Canadians,” he says.
“The pressures on budgets are real for many Canadians, but there's also a long-term cost associated with not investing and then trying to make up that gap later in life.”
Investor's Edge offers several tips for those looking to expand their investing knowledge and skills:
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Start early: Leveraging the power of compound interest can significantly benefit early investors.
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Use the right tools: Access to quality research, such as proprietary research and Morningstar Equity Research Reports provided by CIBC Investor's Edge, can facilitate informed trading decisions.
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Build in diversity: Creating a diversified portfolio through assets like ETFs can minimize risk while earning returns.
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Grow your knowledge: Engaging with books, websites, online communities, and utilizing resources like CIBC Investor’s Edge’s investing 101 page and theme-based strategy builder can enhance one's understanding of investing.
