Saving for retirement

In 2002, a total of 29.7% of all Canadians were between the ages of 40 and 60 (inclusive)—the period during which most people seriously plan for their retirement.

As they map out their golden years, Canadians can look to three main sources for retirement benefits—government pension plans (Old Age Security, Canada and Quebec Pension Plans), employer-sponsored registered pension plans (RPPs) and individual registered retirement savings plans (RRSPs).

In addition to the general aging of the work force, other changes are affecting the way in which Canadians save. The number of people working in industries with full pension plan coverage, such as the public sector, has declined. More and more Canadians are self-employed, forcing them to fend for themselves if they want retirement income.

Many Canadians express concern that government retirement plans may not be there when they need them. Although governments have taken action to shore up the finances of the Canada and Quebec Pension Plans, some commentators believe that the sheer numbers of the baby boom generation will lead to benefit cutbacks. As a result, Canadians have been looking for other ways to save for retirement. Our financial institutions have been adapting to accommodate these needs.