A third-plus Canadians can’t afford their lifestyle

For good or bad, some things never seem to change.

For good or bad, some things never seem to change.

Take Canadians and their finances for example. In a survey conducted 10 years ago 37 per cent of Canadians said thought they would not be able to afford their lifestyle in 2017.

They were right. Today, a follow-up survey shows that 36 per cent of Canadians feel have had to cut back on some of their purchases, proving they were correct in their prediction a decade ago.

Canadians’ pessimism about their finances also extends out into the future, with 39 per cent saying they feel they will have to cut back on spending and their lifestyle 10 years in the future.

“While we’ve seen a lot of changes in the past 10 years, if Canadians are making accurate predictions about their future lifestyle it’s a sign they have a realistic understanding of their finances,” says Carol Bezaire, vice president of tax, estate and strategic philanthropy for Mackenzie Investments.

Pessimism appears to be greatest in the Atlantic Provinces, where more than half of residents believe they will not be able to afford the same lifestyle in 10 years, a big leap from 27 per cent who gave the same response 10 years ago.

In general Canadians pessimism about the future comes from their fears about the impact inflation could have on their money, they haven’t saved enough money for their retirement and low salary expectations. Most expect a salary increase of only one to five per cent over the next 10 years, the same range that salaries have increased in the last decade.

The report also found that Canadians who are closer to retirement are even less secure about their financial future.

Of those in the 55 to 64 and over 65 age categories, less than 35 per cent believe they are on track to meet their financial goals.

Canadians also aren’t contributing to their RRSPs and they are not overly confident about their investment options for retirement savings.

Thirty five per cent don’t contribute to an RRSP while 29 per cent feel indifferent, 23 per cent feel overwhelmed and 20 per cent are confused about their retirement saving investment options.

“With all that is happening in the economy and in the markets, people really need a financial plan and an adviser,” Bezaire said in an interview. “More and more people today are self-employed, working part-time or are consulting and may not have employer-sponsored pension plans. As well there is a lot of volatility in the markets these days. The goal should be to create a sound financial strategy to ensure you don’t have to give up any of the things you enjoy today.”

The lack of financial planning by Canadians may be correlated with a deficiency in seeking out financial advice. The survey found that 58 of Canadians do not use the services of a financial adviser.

However, those who do use an adviser tend to be more knowledgeable about financial products than those who don’t. Almost 70 per cent of people who use an adviser knew that mutual funds could be held in an RRSP compared to 35 per cent of those who don’t have an adviser.

“People seemed to be confused about what to invest in,” Bezaire says. “You need to get an adviser to help you with that. People who worry about their financial future but don’t have a plan are like people who worry about getting lost but don’t use a map. Both a plan and a map are easily available, both reduce a lot of stress and both typically help you reach your desired destination.”

Talbot Boggs is a Toronto-based business communications professional who has worked with national news organizations, magazines and corporations in the finance, retail, manufacturing and other industrial sectors.

Just Posted

Canadians told to brace for a ‘classic’ Canadian winter with lots of snow

TORONTO — One of Canada’s high profile weather forecasters is warning Canadians… Continue reading

Nebraska set to vote today on fate of TransCanada’s Keystone XL pipeline

CALGARY — Five commissioners in Nebraska are set to vote today on… Continue reading

Hippie cult leader Charles Manson dead at 83

LOS ANGELES — Charles Manson, the hippie cult leader who became the… Continue reading

Tie new affordable housing money to outcomes, former watchdog tells Liberals

OTTAWA — Parliament’s first budget watchdog is warning the federal government to… Continue reading

WATCH: Christmas Wish Breakfast toy donations almost double

All toys donated Sunday will be given to the Red Deer Christmas Bureau and Red Deer Salvation Army

VIDEO: Replay Red Deer: Nov. 19

Watch news highlights from the week of Nov. 13

CP Holiday train to stop in Ponoka for another year

The popular train will feature entertainment from Colin James and Emma-Lee

Kittens rescued after allegedly being tossed from vehicle

Couple finds abandoned kittens new home through Facebook

VIDEO: ‘Party bus’ goes up in flames in Vancouver

Fire crews responded to the late night blaze

Chicken crosses B.C. road, stops traffic

Rooster makes early morning commuters wait in Maple Ridge

Red Deerian honours her brother who died in a motorcycle collision

Houaida Haddad is encouraging Red Deer residents to donate blood

Red Deer County firefighters to be recognized for Waterton help

RCMP brass will give formal recognition Monday

Ron James tries to lighten humanity’s load through humour

The comedian returns to Red Deer for shows Dec. 1 and 2

100+ Women Red Deer donate to Christmas Bureau

About $14,000 will help with Christmas hampers and toys

Most Read

Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month