(January 5 – 10:05 ET) – Only 53% of Canadians plan to make an RRSP contribution this year, according to the 10th annual Royal Bank Financial Group RRSP Poll conducted by Ipsos Reid. The result reflects no change from previous years.

The survey is also suggesting that whichever way the market goes, 54% will leave their money where it is now, while nearly 25% are not as sure and will likely decide as the situation develops, with the remaining 21% saying they’ll consider safer types of investments.

“The majority of Canadians are saying regardless which way the market turns, they may adjust their sails, but stay the course,” said Dale Mitchell, Royal Bank’s manager of registered products.

The value of average planned contributions are down slightly over last year’s peak in stated intentions — $4,490 in 2000 versus $5,051 in 1999. But that’s still up from $4,266 in 1998.

According to the survey, 35% expect that income from their own investments will be their primary source of retirement income. Two-thirds of RSP holders are using the services of an investment professional or financial planner.

Mutual funds remain the investment vehicle of choice for 61% of those holding an RRSP. Forty percent of Canadians are still unsure which type of mutual fund will make up the greatest portion of their contribution for the 2000 income tax year. After mutual funds, the most popular savings products are GICs/Term Deposits, 27%; stocks, 22%; savings accounts,18%; bonds,14%.

“Clearly, Canadians are assuming responsibility for their retirement and want information. However, there appears to be a knowledge gap when it comes to investment options available for their RRSP portfolio and anticipated returns,” said Brenda Vince, chief operating officer, Royal Mutual Funds Inc. “Nearly one-third of Canadians do not have any foreign content in their RRSP. And the vast majority, about 73%, according to the survey, are unaware that as of January 1, 2001, the foreign content limit increased to 30%.”

The current mean market value of respondents’ RRSPs is estimated at $58,146 versus last year’s $55,280; 68% of Canadians have reviewed their RRSP with an investment professional in the last 12 months. Of those, half say their advisor has prepared a formal retirement plan for them; the mean expected rate of return has increased from 9.7% to 11%; 56% have a will or an estate plan; 51% made their first RRSP contributions between ages 18-29;

The survey was conducted during November 9-19, based on telephone interviews with 1,202 Canadians 18 years of age or over. The survey is considered accurate to within 2.8%, 19 times out of 20.
-IE Staff