– 76% of retired Canadians are using a financial advisor to manage their savings and investments.
– 57% accurately predicted expenses in retirement, but 31% say they are spending more than expected.
– One third are staying active after retirement through volunteering (15%), working part-time (9%), consulting (4%) or opening their own business (3%).
TORONTO, July 7, 2011 – Canadian retirees who are getting help from their advisors are feeling confident about their retirement savings, finds the TD Waterhouse Canadians and Retirement Report. The survey of retirees from across the country, aged 55-70, found that 76% of retired Canadians are using an advisor to manage their investments.
“The good news is that Canadians are not only aware of the need to plan for retirement, but they’re taking the right steps to get there,” says Patricia Lovett-Reid, Senior Vice President, TD Waterhouse.
Among those working with an advisor, 73% feel their retirement savings are ahead, or right where they should be, compared to their peers. Working with an advisor does more than just make you feel like you are on the right track – it’s correlated with actually being on the right track: respondents working with an advisor were also much more likely to have a financial plan (52% versus 7% without an advisor).
“There’s no such thing as a tried-and-true retirement plan that is a perfect fit for everyone. It’s essential to develop and maintain a financial plan that is right for you,” says Lovett-Reid. “When it comes to money, emotions can run high. When you are trying to find an advisor, I suggest looking for someone that can help you assess your situation, both emotionally and financially. Working with someone you trust is key, and developing mutual respect between you and your advisor is an essential part of developing and executing your financial plan.”
Lovett-Reid offers the following tips for finding an advisor that’s right for you:
- Ask for referrals: Ask your family and friends, or those with similar goals and plans, who they recommend.
- It’s an interview: You should learn as much about your advisor as you can during your first meeting, including qualifications, experience, personality and performance. Think of it like an interview.
- Ask lots of questions: If there’s any investment product or service that you’re unsure about – ask for additional information. Ensure you have all the information, including the risks, potential returns and any commissions and fees.
Planning for the unexpected
While 57% of Canadian retirees say they predicted their expenses in retirement accurately, almost one third (31%) say they’re spending more than expected.
Where are these extra expenses coming from? The most common responses were: day-to-day living expenses (77%), taxes (46%) and medical/health costs (41%). Only 25% say they are spending more money than planned on leisure activities.
“While there’s no way to know exactly what your expenses will be during retirement, there are things you can do to put yourself in the best position possible and be prepared for any bumps along the road, such as unforeseen medical expenses,” says Lovett-Reid. “One example is critical illness insurance, which can ease the burden for families facing the emotional turmoil of an illness by providing peace of mind that unanticipated costs, in addition to regular bills, will be covered.”
It’s not about the money – staying active in retirement
Forty-one percent of retirees say the aspect they found most challenging about transitioning to retired life was no longer being defined by their career. That may be why retirees are not just exiting the workforce and slowing down; they’re staying involved and active.
Nearly one third (31%) are continuing to volunteer or work in some form, whether it’s volunteering (15%), part-time work (9%), consulting (4%) or starting a small business (3%). Four percent responded that while they’re not currently working, they plan to in the near future.
Why are retirees remaining so active? Seventy-eight percent find it personally fulfilling and 56% enjoy the social interaction – less than half (45%) say they are doing it to make extra money.
“From speaking with retirees across the country, we know that it’s not just about the money, however, I do believe having a financial foundation in place really does free you up to do the things that give your life more balance and meaning,” adds Lovett-Reid.
About the 2011 TD Waterhouse Canadians and Retirement Report
The results for the 2011 TD Waterhouse Canadians and Retirement Report were collected through a custom, online survey conducted by Environics Research Group from April 2-28, 2011. A total of 1,006 surveys were completed by retirees aged 55-70.
About TD Bank Group
The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Group (TD). TD is the sixth largest bank in North America by branches and serves more than 19 million customers in four key businesses operating in a number of locations in key financial centres around the globe: Canadian Personal and Commercial Banking, including TD Canada Trust and TD Insurance; Wealth Management, including TD Waterhouse and an investment in TD Ameritrade; U.S. Personal and Commercial Banking, including TD Bank, America’s Most Convenient Bank; and Wholesale Banking, including TD Securities. TD also ranks among the world’s leading online financial services firms, with approximately 7 million online customers. TD had CDN$630 billion in assets on April 30, 2011. The Toronto-Dominion Bank trades under the symbol “TD” on the Toronto and New York Stock Exchanges.
TD Waterhouse represents the products and services offered by TD Waterhouse Canada Inc. (Member – Canadian Investor Protection Fund), TD Waterhouse Private Investment Counsel Inc., TD Waterhouse Insurance Services Inc., TD Waterhouse Private Banking (offered by The Toronto-Dominion Bank) and TD Waterhouse Private Trust (offered by The Canada Trust Company). For more information, visit www.td.com.