A large proportion of Canadians say there are significant obstacles that prevent them from opening their first investment account, according to a recent survey conducted on behalf of Tangerine Bank, a subsidiary of Toronto-based Bank of Nova Scotia.
More than one-third of Canadians (36%) don’t have an investment account and, among those non-investors, only 4% have seriously contemplated opening one. Most Canadian non-investors (70%) say they don’t have the money to invest. Other concerns among non-investors are that they might lose money if they start investing (25%) and that investing is too complex (20%).
What’s notable, however, is that 67% of non-investors agree that investing should be a priority, even if they are in debt. Among reasons they would invest, 50% cite retirement, 36% say faster growth, and 29% say to save for a large purchase such as a child’s education, a vacation or a house.
“Unfortunately there’s a misconception out there that you need to be an expert with a lot of money to start investing, and this simply isn’t true,” says David McGann, director of Tangerine Investments, in a statement.
One important revelation in the study is that 33% of “up and coming” adults, age 26 to 36, have considered or seriously considered opening an investment account, while only 24% of “established” adults, age 40 to 54, had considered doing so.
Furthermore, the study shows that the established adults experience more hurdles to investing than their younger counterparts. For example, 72% of the older demographic say they don’t have enough money to invest, compared with 62% of the up-and-coming adults.
Established adults are less likely to invest even if they have a trusted option with proven results (29%), they would not incur high fees (23%) and would have access to using automatic investing options (21%).
Among Canadians who already are investing, 72% say they began before the age of 34. This statistic appears to be in keeping with further reports that demonstrate more up-and-coming adults (64%) have opened an investment account, compared with established adults (55%).
The top reasons for investing include retirement savings (64%), followed by financial security (56%), the ability to grow money faster (45%) and a big purchase such as a vacation or a child’s education (23%).
The survey of 1,510 Canadian adults was conducted by Angus Reid on August 30 and 31.