Recent market turmoil has drastically changed Canadians’ confidence in their financial goals for retirement, a survey by Desjardins Financial Security shows.

A survey of 2,217 Canadians over 40 conducted just months ago, between June and August, showed that most respondents felt confident about their financial security and retirement plans. A follow-up poll in October revealed a sharp contrast to these results.

According to the October survey, Canadians over 40 are willing to make compromises to save for retirement and are being more selective about where they place their hard-earned retirement savings.

Specifically, 42% would postpone their retirement by an average of 5.9 years. This was true for 50% of women and 36% of men.

“The recent market instability may be the wake-up call that Canadians needed to step up their retirement strategy,” said Michael Aziz, vice-president of sales and business development, individual savings products at Desjardins Financial Security. “As advisors, we try to paint an accurate picture of what they may face financially in 20 to 25 years when they are ready to retire. It’s important to prepare investors for the unknown, especially how to cope with difficult market conditions.”

Among other sacrifices Canadians are willing to make to boost retirement savings, 83% would postpone a major purchase, 77% would take a less expensive vacation, 68% would significantly cut back use of their car, and 58% would get rid of their household’s second car.

As a result of the recent turmoil, Canadians said they would be more cautious in selecting savings and investment vehicles in the next year. Almost half will give more consideration to their financial needs, 48% will pay more attention to the guarantee on the capital invested and 47% will be keeping an eye on the financial strength of their institution.

“Canadians over 40 are not in a state of panic, but seem to be finally paying attention to what the financial services industry has been trying to get across for many years,” said Aziz. “Yes, most Canadians will be able to retire one day, but they are going to have to plan and work towards that goal. And part of this work will include the careful selection of their financial institution.”

IE