Half of Canadians worried about retirement savings
TORONTO - A newly released poll suggests that more than half of Canadians over the age of 45 are concerned that the sagging economy and volatile stock markets are squeezing their retirement savings.
The poll by Sun Life Financial and the CARP seniors group, released Thursday, said 54 per cent of 5,500 CARP members surveyed were worried about the impact of economic turmoil on their financial security.
And a third of respondents said they fear losing money in their retirement accounts from recent stock market losses.
Since the summer, global markets have dropped over fears the Greek debt crisis could lead to a global recession. Some big pension funds have lost about five per cent of their value in the third quarter alone.
However, European stocks gained sharply overnight after leaders agreed on a plan to provide Greece with more rescue loans.
Markets in Canada and the United States showed big gains in early trading, the Toronto stock market surging more than 250 points and the Dow Jones industrial index up about 230 points.
The Sun Life poll with its new partner CARP, a 350,000-member seniors lobby group, aims to increase awareness of wealth management and financial planning for Canadians close to retiring or who are already retired.
For banks and insurance companies like Sun Life, Canada's third largest insurer, wealth management is a growing part of its business and is generating higher profits every quarter.
However, even Canada's third largest insurer isn't immune to the impact of financial market volatility. The company has warned it will post a loss of about $621 million in the quarter ended Sept. 30 from volatile markets, low interest rates and other factors.
Other insurers are also expected to be hit by the market volatility in the latest quarter, although, if markets recover, so will the industry's bottom line.
When it comes to retirement planning, the Sun Life-CARP survey also found:
-- More than 30 per cent of respondents feared unexpected events that create extra expenses.
-- Despite concerns, over 69 per cent said they were confident that they have a plan to maintain their lifestyle in retirement.
-- More than 30 per cent said they were concerned about keeping their lifestyle and believe their plan needs some work.
"These poll results reflect some concerns that we are hearing from our clients in the 45-plus age bracket about the economic challenges," said Kevin Dougherty, president of the 7,00-employee Canadian division of Sun Life Financial.
"Now more than ever, it is critical to ensure you have the right plan to save enough for your retirement."
CARP president and ZoomerMedia Ltd. CEO, Moses Znaimer, said retirement planning is critical for Canadian seniors facing uncertain economic times.
"Generally speaking CARP members are living longer and better than ever," he said in a release.
"Many have planned or are mindful about the need to plan for their complete, or semi, retirement; but are concerned about the world situation's impact on their savings and the possibility of outliving their money."