Fewer than half of Canadians approaching retirement age have an income strategy in place, and two thirds haven’t considered the possibility that they could outlive their savings, according to a report by the BMO Retirement Institute.
Only 48% of those polled are planning to, or already have, discussed retirement incomes and how to structure their investments, it said. While the majority believe that unpredictable factors, such as inflation or medical expenses, may affect their financial stability, only 48% have planned for such contingencies, it said.
“As Canada’s boomers draw closer to their retirement years, having a strategy to manage investment income throughout retirement should be a top priority,” said Tina Di Vito, head of BMO Retirement Institute. “Financial resources available through programs such as the Canada Pension Plan and other pension schemes likely won’t be enough to support the average retirement lifespan.”
Nearly all baby boomers will be eligible for retirement within the next 20 years, and concern is mounting that their savings will not cover basic living expenses. To tackle the problem, the government is carrying out a series of consultations on how to reform the country’s pension system.
BMO urges those in the 55 to 65 age group to take a close look at their investments to ensure they will provide enough income to support their desired lifestyle.
The survey of 1,542 adults between April 12 and 15 was carried out by Leger Marketing.
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