Survey sheds light on retail investors’ sentiment on stock markets and outlook on their financial futures
Nearly three fourths of Canadians who have yet to retire are concerned that they’re falling short of their retirement goals, according to a new poll.
In Scotiabank’s 2021 Retail Investor Sentiment Survey, 72% of respondents who have not yet retired said they’re worried they’re not saving enough for retirement.
Around one third (32%) project that because of the pandemic, they won’t be able to retire at their desired age. Nearly three tenths (28%) said they won’t be able to settle their debts before retiring, and nearly half (44%) believe they’ll need to set aside more than $1 million to finance their ideal retirement lifestyle.
The poll also found a gender gap in perceived retirement readiness, with 58% of men reporting they feel on-track to achieve their retirement goals, compared to just 43% of women.
For most Canadians, the financial markets are a valuable vehicle for their retirement plans. Six tenths of Canadians (59%) are investing their money; 31% are not and have no plans to start, while 10% plan to begin investing in the next six months.
Among investors, one third (33%) said they’re holding off on investing entirely for now due to the uncertainty they feel from the pandemic, and 15% said they prefer to keep their money in their savings accounts. And even after living with the COVID-19 pandemic for nearly a year, 70% of Canadians said the current environment makes it hard for them to know what to do when it comes to their investments.
“As Canadians continue to deal with the financial implications of COVID-19, it’s understandable they feel unsure about how to approach their investments,” said D'Arcy McDonald, SVP, Deposits, Investments, & Payments at Scotiabank.
Despite the prevailing sense of uncertainty, two thirds of investors (67%) said they sense an opportunity in the current market environment. One in five (20%) said they’ve had increased confidence in the financial markets since news of COVID-19 vaccine approval first came out, and 55% of Canadian investors are feeling optimistic about their financial future.
With respect to RRSP contributions, one third of Canadians surveyed (32%) said they plan to contribute to a Registered Savings Plan (RSP) for the 2020 tax year, while more than half (56%) said they won’t be contributing. Compared to Canadians age 55 and above, those under 55 years old were more likely to contribute to an RSP this year (42% vs. 14%, respectively).
As for TFSAs, nearly half of Canadians (47%) said they plan to make TFSA contributions this year, while 37% have no plans to do so and 16% are unsure.
“When it comes to your financial future, it’s important to make sure your money is working for you,” McDonald said.
