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According to a new poll released by RBC, RRSPs are becoming ever more popular, especially amongst the younger generation.
The 22nd Annual RBC RRSP Poll shows that 43% of Canadians between the ages of 18-34 are now RRSP holders, which represents a rise year-over-year.
Even though retirement is off far in the distance for this group, retirement savings is quickly moving up their collective lists of financial priorities. There seems to be a growing awareness of the impact that action in the current day can have on a future financial picture.
While many more in this age group are holding RRSPs, the amount that they intend to contribute has fallen significantly year-over-year. Last year, 33% of this group intended to maximize their RRSP contributions; the most recent findings of the poll show that this number has dropped to 16%.
"Younger Canadians have any number of competing 'here and now' financial needs, in addition to trying to save for their future goals." advised Jason Round, head, Financial Planning Support, RBC Financial Planning. "We want to ensure young Canadians know all the options available to help them. The tax-sheltering benefits of RRSPs can help to buy your first home and grow your money for future goals. Contributing to an RRSP also helps to reduce your taxable income today."
While retirement planning has taken steps to move up the priority ladder, home ownership still remains at the main goal for this age group.
There is a marked shift though, according to this poll, towards paying down current debt loads in favour of saving for other things. This may be in part to currently low interest rates, which for some allow the pursuit of multiple financial goals at once.
What is notable is that there is a shift in awareness towards the need to save, and the relationship between developing and employing a financial strategy to assist in the reaching of short and long term goals.
"Trying to take care of day-to-day expenses, save up for that first home and put aside money for future goals, such as retirement, may feel overwhelming, but it can be done if you set your priorities and make informed decisions," added Round
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