The average amount of money held by Albertans in registered retirement savings plans is lower than the national average.
According to a report released on Tuesday by BMO Financial Group, in 2018, the Alberta amount was $98,933. The Canadian average was $101,155, a 21 per cent increase from 2016 ($83,635).
“While balances typically rise due to contributions and asset appreciation, it is important to note Canadians of all generations are saving for retirement despite financial priorities and market volatility,” said Robert Armstrong, vice-president of multi asset solutions at BMO Global Asset Management. “It is encouraging to see a national shift in the attitude and approach to retirement – especially amongst Millennials surveyed.”
Key highlights of the report include:
- millennials continue to hold higher amounts over time, accounting for the highest percentage increase with 87 per cent since 2016 ($28,821 vs $15,377 in 2016);
- accounts held by baby boomers saw a 30 per cent increase over the same period ($178,664 from $137,360 in 2016);
- 62 per cent of Canadians have already contributed before the RRSP deadline of March 1 or are planning to do so; those who have already contributed put in an average of $5,247 in 2018;
- the frequency of RRSP withdrawals has decreased by one third since 2017. However, Canadians who decide to dip into their retirement savings before age 71 are taking out larger amounts. The 2018 national average withdrawn was $25,779 compared to $20,952 in 2017.
“Buying a home remains the top reason for withdrawing funds according to those surveyed,” said Armstrong. “While they are taking a concentrated look at retirement investments and saving for their futures, Canadians continue to take advantage of the federal government’s Home Buyers’ Plan through RRSP withdrawals.”
– Mario Toneguzzi for Calgary’s Business