Growing Number Of Canadians Unprepared For Retirement

For many working Canadians, the days of having one career with one organization have disappeared. Instead, an increasing number of workers are joining the “Flexforce” – a group that comprises gig workers, job jumpers and postponed professionals, who are redefining what traditional employment looks like. And as the face of Canada’s workforce changes, so does the ability to manage finances and plan for retirement.

According to a recent TD survey conducted by Environics Research, nearly two-thirds (64%) of Flexforce Canadians anticipate needing to work into their senior years because they won’t have enough saved for retirement. More specifically, nearly three-quarters of these same Canadians (72%) are finding it difficult to save for retirement, while four in ten (41%) are not sure when they’ll retire given their employment situation. This naturally leaves a large and growing group of Canadians following unconventional career paths feeling uncertain (47%) and worried (34%) about their future, with only a small proportion (11%) claiming to feel secure about saving for retirement.

nearly two-thirds of Flexforce Canadians anticipate needing to work into their senior years

“Planning for retirement can be overwhelming in any circumstance, but it becomes even more challenging when it’s tied to the uncertainty that accompanies Flexforce employment,” says Jennifer Diplock, Associate Vice President, Personal Savings and Investing at TD Canada Trust. “An increasing number of Canadians are choosing temporary or non-traditional employment and are having to rethink retirement – specifically what retirement will look like for them and what steps they’ll need to take in order to feel confident about achieving their retirement goals.”

When it comes to retirement goals, 55 percent of Flexforce Canadians say they are not able to save as much as they need to each year to meet their goals, with over three-quarters (76%) wishing they had made financial contributions at an earlier age. Canadians report that the top three factors holding them back from contributing to their retirement savings include day-to-day bills and expenses (49%), paying off existing debt (32%) and paying for their lifestyle (27%).

“Today’s changing workforce brings a number of variables and unpredictability, so building a strong foundation can help steer you in the right direction,” says Diplock. “Many employers no longer offer a pension plan and the onus now falls on employees to not only self-fund their retirement, but to also determine how much money they’ll need and how to save for it. This shift in planning for retirement can be daunting, which is why it’s more important than ever to have a personalized plan in place to help make your retirement whatever you want it to be.”

No matter what your job status, TD offers the following advice, so you can feel confident as you plan for retirement:

Plan. Whether you’ve been working for decades or are just getting back into the workforce after a prolonged absence, everyone has their own idea of what they envision their retirement to look like – which means there is no one size fits all approach. Once you’ve determined your goals, establish a retirement savings plan to help you stay on track. A useful tool is the online TD Retirement Calculator, which estimates how much you would need to save to retire with the desired income you need for the retirement lifestyle you want. Once you have a picture and a plan for your ideal retirement, take steps to turn that vision into a mission. For example, meet with a financial advisor to help create and implement a retirement plan, and consider setting up automated contributions into a retirement savings vehicle that will add up over time.

Understand. Planning for retirement can be confusing, so it’s important to learn what retirement will entail and what options are available to help get you there. Given the number of variables and the degree of unpredictability you may experience in the Canadian Flexforce, it’s important to speak to a financial advisor to set up a plan tailored for your specific needs and situation. It’s also key to understand your spending and saving habits so you can readjust if needed. Tools like the TD MySpend app can provide notifications of your spending transactions in real time, which in turn can provide insight into your financial habits so you can take more control over how you manage your money. You can also access a variety of resources online or in-branch through a financial advisor, who can help answer your retirement planning questions.

Scan. In addition to monitoring your spending, you should also keep close tabs on your retirement investments. While it may not be necessary to check your portfolio daily, it’s a good idea to check in with your financial advisor at least once a year, or whenever there’s a major milestone in your life, like buying a home or welcoming a new family member. Starting a new business or taking on a permanent role could also be a good opportunity to meet with your advisor to ensure your retirement plan is still headed in the right direction.


About the Survey

TD Bank Group commissioned Environics Research to conduct a custom survey of 1,101 Canadians aged 18–54, who identified as a Gig Worker, Postponed Professional or Frequent Job Jumper. Responses were collected between November 16 and December 3, 2018.

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