Household Savings May Be up, But Retirement Savings Are Down
The comments below are an edited and abridged synopsis of an article by Investment Executive
Many households have seen their savings skyrocket during the pandemic, but that hasn’t necessarily translated to an increase in retirement savings.
According to a survey from the Healthcare of Ontario Pension Plan (HOPP) and Abacus Data, 46% of Canadians said they saved more money during Covid-19 than they otherwise would have. But more than half (52%) of those people said they’d saved nothing for retirement.
Overall, 63% of Canadians said they’d saved nothing for retirement last year, up from 58% in the previous year’s survey.
Just under half (48%) said they were very concerned about not having enough money to retire, making retirement woes a bigger concern than physical health (44%), mental health (40%), debt load (31%) and job security (26%).
The survey found that 52% of respondents making $50,000 or less were very concerned about saving for retirement, compared with 42% of respondents earning more than $100,000. Overall, 36% of respondents said they were living paycheque to paycheque.
Two-thirds of respondents said a retirement crisis is coming, and 65% said saving for retirement is prohibitively expensive.
Given those numbers, it may come as no surprise that most respondents said they’re depending on their employers when it comes to retirement savings.
Seventy-one percent said they’d forgo a higher salary for a better workplace pension, and 85% said they believe employees should have access to an affordable retirement savings plan. Seventy-seven percent said employers have a responsibility to offer a pension plan.