A brutal two-year mauling of North American equities has taken a toll on older Canadians' portfolios, a survey has found.
Two thirds of polled Canadians approaching retirement, or 67 per cent of people aged 45 and up, say their retirement plans have been hit by the stock markets' dismal slide.
Among that group, 60 per cent have been forced to set back their retirement date by up to five years or more, according to a second wave of information released in an annual Royal Bank of Canada/Ipsos-Reid RRSP poll.
"Many Canadians are realizing that their retirement plans do not match the reality of their savings," Laura Gainey, vice-president of customer management at RBC, said in a release.
The situation among retirees is equally dismal. Four-fifths of those surveyed have been hurt by markets, forcing 74 per cent to make changes and cutbacks to their retirement lifestyle, while another 7 per cent have returned to work.
Stock markets have endured several terrible years. In 2002, equities on Wall Street posted their worst performance in a quarter of a century, producing a third consecutive losing year for the first time since 1939-1941.
In Canada, stocks fell for a second straight year last year, the first back-to-back decline since 1973-1974.
Confidence among investors has taken a hit, forcing Canadians to re-evaluate what income they will live off when they retire.
Only 20 per cent of Canadians approaching retirement said their retirement will be funded by money from their own investments. More than half of respondents, or 55 per cent, said that pension income from an employer or government will be a primary source of income for their retirement.
The survey of 1,200 Canadians was conducted between Nov. 7 and Nov. 24, 2002. The poll was conducted among people 18 years of age, or older, and is considered accurate within 2.8 percentage points, 19 times out of 20.
© The Globe and Mail
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