When I worked in banking, January and February were known as the dreaded “RRSP Season”.  It was the approximate equivalent of the retail “Christmas season” with long extended hours, lines of desperate people wanting a quick RRSP purchase, and the inevitable sales quotas.

Related: How an RRSP loan turned my $12,000 contribution into $20,000

With the said line-ups, there was no time for proper planning or consultation, it was a quick “sign the loan document here, park your funds in a savings account or money market mutual fund, and we’ll get back to you later.”  Next!

Since my experience was several years ago, I assume that most people now have a retirement plan that they contribute to regularly, thereby avoiding the last minute rush to the bank.  However, there are still the procrastinators who have to wait until the last minute.

Retirement polls and surveys

Financial institutions tend to commission surveys on retirement at this time of year.  Are they aimed at those procrastinators – a type of scared-straight approach?

“Look at these seniors who don’t enough money to retire and now have to keep working until they’re 90 years old!  START SAVING NOW or you’ll end up in the same situation!  We can help you.”

Related: How to overcome financial inertia

Personally, I have a love/hate relationship with surveys.  On the one hand, I like to see other people’s opinions (do we agree, or am I the only strange one?).  On the other hand, I suspect that answers can be biased from:

  1. How the questions are worded and,
  2. Respondents often give answers they think are expected.

When do we expect to retire?

Back in the late 80’s, London Life had a great advertising campaign promoting “Freedom Fifty-Five.”  The ad showed a man in a business suit running for the bus, suddenly transported to the year he will turn 55 and running down the beach with his future self.

“We look pretty good,” he says to his handsome, silver-haired and trim self.

People still strongly associate Freedom 55 with early retirement even though an Ipsos Reid survey indicated that Canadians have not seen age 55 as a realistic benchmark for some time.

The odds of retiring earlier are not as good as they used to be.  In 2008, 51% expected to be fully retired by age 66.  Now it’s down to 27%.  The younger the respondent, the lower the age, while those 55+ find they will likely not be in a position to stop working until at least age 67.

Related: What’s all this retirement planning for, anyway?

At what age do you expect to retire from your main employment?

Retirement Income

The average retirement income desired is $59,000, with 36% wanting $25,000 – $50,000 and 31% desiring $50,000 – $75,000.

Many Canadians are surprised by how much they need to save to fund their desired income and that their income is going to plummet.  Is this because the financial institutions (and media) highly promote a retirement portfolio of at least $1 million?  Is the desired income unrealistic considering most expenses will be reduced or eliminated in retirement?

The reality, according to Sun Life Financial, is that six in 10 Canadians expect to retire with less than $250,000 in savings, while 38% will retire with less than $100,000.

Nearly 25% feel there is a serious risk of outliving their savings.  Over 58% feel they are not prepared financially.  A mere 26% think they are saving enough.

Related: Are you counting on an inheritance?

Have you prepared a realistic retirement budget?  How much do you really need?

Hi Ho! It’s off to work we go.

Retiring used to mean working until age 65, then spending your free time working on your hobbies, or sitting on your deck with a beer in one hand and the latest best seller in the other.

Some retirees choose to re-enter the work force.  Two friends of mine work part-time in a big box retail store.  One uses the funds and extended vacation time to travel with her seniors’ club.  Since retiring she has enjoyed her dream of visiting China, Africa and New Zealand.  The other works to fund her expensive sewing hobby.

A recent survey found that more than half of boomers are considering or have started a small business – for extra money, but also to keep themselves engaged.

An ING Direct survey, however, shows that 48% of retirees are being forced back to work due to financial reasons.  One-third of respondents did not have enough money saved and 31% faced increased living costs.  31% had to return to work full time!

Related: 16 habits that helped me retire wealthy

Have you considered a “second act” career?

Final thoughts

Are the surveys successful for their intended purposes?  Are Millennials (those aged 18 – 34) preparing for retirement?  ING Direct shows that 64% contribute regularly to their retirement savings and are confident they will retire when expected.  They intend to avoid debt and save more, and stick to a financial plan.

WOW!  I’m impressed!

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