While inflation fears and public health are top of mind, Canadians maintain a positive outlook on retirement, according to a report from Fidelity Investments Canada ULC.
The 2021 Fidelity Retirement Report found that 68% of pre-retirees said they feel positive about life in retirement, with the majority of all respondents expecting the financial well-being of their household to improve over the next year.
Overall sentiment was consistent across the country, with a few regions standing out in terms of resilience. Pre-retirees in Quebec have the most positive outlook, with 71% optimistic about their retirement compared to 62% in British Columbia, which was the lowest among all regions.
The report showed more optimism than last year’s survey, which was conducted in May 2020 as Canadians struggled with volatile markets and an uncertain economic outlook.
With regards to inflation, the 2021 report found that most retirees are paying attention to rising costs. For pre-retirees, more than half (56%) said they are concerned about the impact inflation could have on their retirement plans.
Canadians from B.C. approaching retirement are most worried about inflation (64%) while pre-retirees in Quebec are less concerned (52%).
Further, almost three-quarters of retired Canadians (73%) and over half of Canadians approaching retirement (57%) indicated that Covid-19 has changed the way they live (or expect to live) life in retirement.
Health-care planning has become more important, the report found, with 60% of pre-retirees with a written financial plan having included a budget for health-care costs.
“The global health crisis and the cost of goods and services going up are influencing how Canadians envision their retirement, what they value and are worried about, the timing of retirement and so much more,” said Peter Bowen, vice-president for tax and retirement research with Fidelity, in a statement.
In addition, 85% of pre-retirees who had a financial plan said they felt financially prepared for retirement. That number was even higher in retired Canadians, with 94% of retirees who had a plan saying they felt financially prepared.
“While themes like the pandemic, inflation and cost of living can dominate the news headlines, our research shows that regardless of the headwinds Canadians are facing, when you work with a professional financial advisor, you are more confident, prepared and less stressed about retirement planning,” Bowen said.
The 2021 Fidelity Retirement Report surveyed 1,901 Canadians aged 45 and older online between Aug. 1 and Aug. 20, with a disproportionate sample of pre-retirees and retirees. The results were weighted to reflect the over-45 Canadian population, but online surveys can’t be assigned a margin of error because they don’t randomly sample the population.