One-fifth of working and retired Canadians expect to run out of money in five years or less after retiring, according to a survey conducted by the Brondesbury Group for Toronto-based HomEquity Bank.
The survey gauges both working and retired Canadians’ financial expectations for their retirement and their financial reality. With 29% of pre-retired Canadians and 35% of retired Canadians surveyed stating they have saved less than $50,000 for retirement, it appears that respondents are realistic about whether their current savings will last their entire retirement.
The HomEquity survey found that the pre-retired group had very realistic expectations about the cost of retirement. Slightly less than half of respondents, 48%, estimate it will cost between $20,000 and $50,000 a year to live once they’re done working.
One area in which Canadians are being unrealistic is in the level of debt they hold. In the pre-retired group, 71% reported being approximately $25,000 in debt while half of the retired group indicated having $20,000 worth of debt. However, Statistics Canada reports a median value of about $93,000 of debt for those between the ages of 55 and 59 and $32,000 for those ages 70 to 74.
The Brondesbury Group conducted the online survey of 1,001 Canadians in February. The pre-retired group included 337 individuals who plan to retire within 10 years and other working Canadians over the age of 55. The retired group consisted of 664 people. All the respondents were required to be current or former homeowners.