“In previous surveys, when we looked at younger peers, they tended to think more short-term,” said Rob Shields, Questrade’s chief marketing officer. “Young people were more mobile and transient, and they were working more in the gig economy, so they were not being advised to open RRSPs.”
Of course, the younger generation is increasing the limited contribution. Among 18- to 34-year-olds planning to contribute more to their RRSPs, more than half (53%) planned to increase their contributions to $4,000 or less. In contrast, among respondents who were 55 and older, 40% said they were planning to increase their contribution to $4,000 or more.
Looking at the motivation of Canadians who want to contribute more, 46% cited a desire to prioritize their retirement, making it the top reason for additional RRSP contributions. Another 28% said they were trying to grow their nest egg earlier, and 23% – including 35% of 18 to 34 year olds – cited a better understanding of the importance of starting earlier.
“This last survey showed little variation on long-term thinking among young adult Canadians,” says Shields.
Of course, it’s not just retirement on the minds of the younger generation. While only 8% of respondents with RRSP said they are using their RRSP to buy a home, that number more than doubled to 17% among respondents between the ages of 18 and 34.
