A new CIBC poll conducted by Nielsen finds that 65 per cent of Canadians are entering the new year feeling confident they will reach their financial goals, a decline from the same poll last year (76 per cent), and the lowest number in five years. Canadians aged 45 and up accounted for most of the decline, while younger Canadians remained confident about the future.
Canadians aged 45-54 were among the least confident, with only 58 per cent feeling confident about reaching their financial goals – a decrease from 77 per cent in the same age group just last year.
Among Canadians aged 55-64, 61 per cent feel confident about reaching their financial goals, down from 74 per cent last year. By comparison, 75 per cent of Canadians aged 25-44 said they are confident they will reach their financial goals, relatively unchanged from a year ago (76 per cent).
Another recent poll from CIBC showed that paying down debt is the number one financial priority for Canadians for the fifth year in a row, with those nearing retirement even more focused on debt than Canadians on average.
“We are seeing a real conflict among Canadians close to retirement, who are trying to balance their short-term need to reduce debt with the longer-term goal to save for the retirement they want,” says Christina Kramer, executive vice-president of retail and business banking at CIBC. “As Canadians approach traditional retirement age it can be a challenge to keep focused on both, and that can impact their overall confidence in their future finances.
“This decline in confidence among boomers is the most significant we’ve seen in five years,” says Kramer. “As each year goes by and boomers increasingly focus on debt reduction as an immediate priority, they also get closer to retirement without a long term plan in place that will deliver the retirement they are looking for.
“Having a financial plan that addresses all economic conditions can help build the personal financial confidence they may be seeking.”
Positivity also on the decline; advice could be the key
The percentage of Canadians who say they feel positive about their current financial situation has also dropped from past years’ polls:
As well as being the least confident about their finances, 45-54 year olds were also among the least optimistic, with only 58 per cent feeling positive about their current financial situation.
Interestingly, the poll also found that this same age group was among the least likely to have met with a financial advisor in the past year, with just 40 per cent of 45-54 year olds getting financial advice (compared to 45 per cent of Canadians overall).
“Meeting with a financial advisor will help you gain a better understanding of your current financial situation, which can lead to a more positive outlook,” Kramer notes. “It is a small investment in terms of time, but it is an important first step in developing a realistic plan to help achieve your personal financial goals.”