Taxes and inflation top the list of concerns for Canadian retirees, even though a large number of those surveyed retired with debt and many even acquired new credit products after retiring, according to a new poll from RBC released Monday.
RBC’s Retirement Myths and Realities poll, which examines Canadians' expectations and experiences in retirement, found that 39% of respondents over the age of 50, who have assets of at least $100,000, retired with some form of debt and 22% entered retirement with a mortgage on their primary residence. And even though 70% said they feel it is important to be able to save part of their income, 28% have acquired new credit products since they retired.
"More and more, Canadians are carrying debt into retirement, which is not necessarily a bad thing," Lee Anne Davies, head of retirement strategies at RBC said in a release.
"Having access to credit in retirement can be beneficial to managing income and cash flow and provide additional flexibility. To help make your retirement dreams a reality, our advice is to start early and prepare a comprehensive financial action plan that will keep you focused on paying down debt and saving, as well as establishing a budget for both your pre- and post-retirement years."
The findings are not surprising given how far in debt most Canadians are today. A CIBC report earlier this month that found that household debt in Canada is rising twice as fast as assets, personal income growth is "softening," and the gap between income and house prices is at a 20-year high.
However, despite the high levels of debt, inflation and taxes are among the top concerns for retirees according to the RBC poll, with 35% saying they were worried that it is inflation that will negatively impact their retirement income. Meanwhile, 62% of respondents said they worry about taxes on their income, with 66% saying they believed the percentage of their income required for taxes will rise in the next 10 years.
RBC’s Retirement Myths & Realities poll surveyed 2,143 adults aged 50 and over with household assets of at least $100,000. It was conducted online by Ipsos Reid from March 10 to 19, 2010.
