BMO’s 15th annual Retirement Survey reveals several key insights into how Canadians feel about their retirement savings. The survey finds over three quarters of Canadians (76%) are worried they will not have enough money in retirement because of rising prices. The survey also finds 63 per cent of Canadians believe rising prices over the past 12 months have limited their ability to save for retirement. On average, Canadians surveyed believe they will need just over $1.54 million to retire, down from $1.67 million in 2023, said the bank on Wednesday.
Amid inflationary concerns, Canadians are contributing more than ever to their Registered Retirement Savings Plans (RRSP). This year, average RRSP contributions are on track to reach $7,447 – a 14 per cent increase over last year ($6,512) and above the pandemic high-water mark set in 2021 ($6,822), it said.
Annual RRSP Savings Hit Record High, according to BMO Retirement Survey
Brent Joyce
“Many Canadians continue to show resilience, making saving and investing in their retirement a top priority,” said Brent Joyce, Chief Investment Strategist and Managing Director, BMO Private Investment Counsel. “For Canadian investors, one of the best ways to make financial progress and stop rising prices from eroding retirement savings over the long term is to have a portfolio designed to mitigate inflationary pressures, while also taking other factors like investment time horizon and risk tolerance into account. Investors may also want to consider speaking with an investment advisor when looking for ways to help reduce the impact of inflation on their portfolio.”
Among the 63 per cent of Canadians who say rising prices are limiting their ability to save for retirement, BMO said the top four ways they are adjusting their financial planning are:
- Cutting other spending to maintain current retirement savings levels
- Putting less into retirement savings
- Planning on working longer
- Putting off retirement savings completely
Robert Kavcic
“Inflation is a major concern for Canadians, and the spike in prices as the economy emerged from the pandemic is a stark reminder rising prices can affect spending, investment and savings plans,” said Robert Kavcic, Senior Economist, BMO. “Inflation should always be a major consideration when saving and investing for retirement and if investors have concerns about how rising prices may impact their retirement savings, it may help to seek guidance from a financial professional.”
BMO’s Helpful Retirement Tips
For Canadians thinking about how much money they may need for retirement and how to maximize their RRSP savings, BMO offers the following retirement planning tips:
- Start planning early: Outlining retirement objectives and long-term financial goals can determine the appropriate investing and savings solutions to incorporate in a retirement plan.
- Practice discipline: Manage spending, review budgets and include continuous savings plans as an expense. Monitoring spending with a monthly budget will allow flexibility to suspend or decrease the continuous savings plan when needed, or increase the amount when a budget allows for it.
- Contribute securities to an RRSP: RRSP contributions do not have to be made in cash; securities may be deposited in any qualified RRSP investment already owned in an RRSP instead of cash. This is called an “in-kind’ contribution or transfer.
- Seek professional advice: A professional advisor has the resources and expertise to monitor a retirement portfolio regularly and recommend investing and savings strategies based on financial circumstances, aversion to risk and long-term financial goals.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 and 2024 as one of the top business journalists in the world by PR News. He was also named by RETHINK to its global list of Top Retail Experts 2024 and 2025.
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