It has been a shared experience, and not a good one. Research by the National Institute on Retirement Security (NIRS) shows that while nearly every U.S. state,...
About two-thirds of Canadian households have caught the savings bug, putting money aside for retirement, reports CBC News.
Despite a drop of 4.6 per cent in the second quarter of the year, 65.2 per cent of 14 million households made some sort of contribution to retirement savings, be it a “registered pension plan, an RRSP or a tax-free savings account (TFSA)” in 2015, according to Statistics Canada.
“I think things in general are still in pretty good shape when it comes to preparing for retirement,” Fred Vettese, chief actuary at Morneau Shepell, is quoted saying. “For the most part, when you look at middle-income Canadians, they are saving.”
The data shows that different savings vehicles are used depending on age and income level. For instance, reports CBC, younger Canadians 35-54 prefer TFSAs while older workers leans towards RRSPs.
However, Canadians over 55 join younger workers in their preference for TFSAs, mostly likely because they have maxed out their RRSP contributions or need access to cash in the near future. Unlike RRSPs, there is no tax penalty for withdrawing money from a TFSA.
More: Impact of lower interest rates.
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