Annual poll reveals the focus on debt management and budgeting is increasing - while retirement planning takes a back seat among younger Canadians
TORONTO, Dec. 28, 2011 /CNW/ - A new CIBC (TSX: CM) (NYSE: CM) Poll conducted by Harris/Decima reveals Canadians named paying down debt as their number one financial priority entering 2012, followed by managing day to day spending and retirement planning. Compared to the findings of the same poll one year ago, more Canadians are focusing on debt repayment in the year ahead.
Top 3 Financial Priorities, year over year:
2011 2012
Paying Down Debt 14 per cent 17 per cent
Managing Day to Say Spending & Budgeting 12 per cent 14 per cent
Retirement Planning 13 per cent 11 per cent
"More Canadians are recognizing the importance of managing debt as a component of their overall financial plan, and that is driving an increased focus on debt management and day to day budgeting entering 2012," said Christina Kramer, Executive Vice-President, Retail Distribution and Channel Strategy, CIBC. "Canadians are also increasingly seeing the connection between good management of their day to day budget and their longer term financial goals, recognizing that taking smaller steps today as part of a plan can lead to significant benefits down the road."
While paying down debt was the top priority among Canadians, financial priorities vary across age groups:
Among 25 - 44 year olds, 23 per cent named paying down debt as their top financial priority right now, while 14 per cent of this age group said building savings was their top priority.
Among 45 - 64 year olds, 20 per cent named retirement planning as their top financial priority right now, followed by paying down debt (16 per cent).
Managing day to day spending and budgeting was also a key theme in the survey across all age groups. Those 65 and over placed a particular emphasis on this aspect of their finances, with 24 per cent of those surveyed in this age group naming this as their top financial priority.
"It's not surprising to see that the financial needs of Canadians vary at different stages of life, which speaks to the need for individual financial advice," said Ms. Kramer. "For example, baby boomers have a clear focus on retirement, while Canadians over 65 years of age are focused on cash flow management given that many in this age group have started drawing on their retirement savings."
Ms. Kramer noted that while Canadians have a clear sense of their priorities for the year ahead, it is important to recognize that your finances are integrated.
"Paying down your debt can improve cash flow, which in turn gives you more money to work with each month to put towards your savings goals or longer term goals such as retirement," added Ms. Kramer. "With interest rates low as we enter the New Year, 2012 presents a good opportunity for Canadians to make progress on debt repayment as part of their long term financial plan."
While boomers maintained a strong focus on retirement, few Canadians in their 20s and 30s ranked retirement planning among their top financial priorities. Only 5 per cent of Canadians surveyed between 25-34 years of age said retirement planning was their top priority, while another 8 per cent said it was their second priority.
"It's understandable that younger Canadians are more focused on managing their mortgage and building their savings, but it's never too early to start saving for retirement, particularly with time on your side to have those savings grow over the years," added Ms. Kramer. "Part of a discussion with a financial advisor about your needs should include a long range plan for retirement that you can start taking small steps towards today."
KEY POLL FINDINGS
Percentage of Canadians that name paying down debt as their top financial priority by age:
18-24 21%
25-34 22%
35-44 24%
45-54 17%
55-64 14%
65 and over 9%
Percentage of Canadians that name managing day to day spending and household budgeting as their top financial priority by age:
18-24 9%
25-34 14%
35-44 10%
45-54 12%
55-64 13%
65 and over 24%
Percentage of Canadians that name retirement planning as their top financial priority by age:
18-24 2%
25-34 5%
35-44 7%
45-54 19%
55-64 21%
65 and over 5%
Results are based on a CIBC poll conducted by Harris/Decima, via teleVox, which surveyed 2,015 Canadians. The associated margin of error is +/-2.2%, 19 times out of 20. Polling was conducted between November 10th to 21st,
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