Boomer business owners more likely to delay retirement, according to RBC Poll
February 20, 2009 By CNW Group Ltd.
Feb. 20, 2009 – Thirty-seven percent of Canadian boomers who plan on retiring in the
next five years and who own their own business plan on delaying their
retirement due to current economic conditions, according to the19th
Annual RBC RRSP Poll.
Thirty-seven percent of Canadian boomers who plan on retiring in the next five years and who own their own business plan on delaying their retirement due to current economic conditions, according to the19th Annual RBC RRSP Poll.
"Knowing when to leave the workforce is a tough decision," said Lee Anne Davies, head, Advanced Retirement Strategies, RBC. "The best way to decide when to retire is to think about the lifestyle you want to lead in retirement and create a plan to help ensure financial stability and built-in flexibility to adjust to changing life and economic conditions."
The survey also found that more than a quarter (28 per cent) of Canadian boomers plan on delaying their retirement due to current economic conditions. Forty-three per cent of boomers say their retirement has been delayed between one and two years, 37 per cent say three-to-five years and nine per cent say they don't know.
"Even for Canadian entrepreneurs who never intend to fully retire from their business, it's important to regularly fine-tune their long-term plan," said Davies. "Whether you foresee gradually stepping away from your business, working part-time or full time, having a plan that clearly outlines your lifestyle goals and sources of income will help business owners prepare for their golden years."
According to the survey, one-third (32 per cent) of retiring boomer business owners, say they will never fully retire, 19 percentage points above the Canadian boomer average. When asked where they expect to be at 65, half (50 per cent) of retiring boomer entrepreneurs say they will be semi-retired or working part-time, compared to 40 per cent of the general boomer population. In addition, only 37 per cent of retiring boomers who own their own business expect to be fully retired at the age of 65, 10 per cent less than the Canadian boomer average (47 per cent).
One-in-four boomers would retire immediately if they had enough money compared to only 18 per cent of retiring boomers who own their own business. Half (50 per cent) of boomers say they would continue to work part-time or occasionally, compared to 54 per cent of retiring boomer business owners. In addition, one-in-four boomers say they would continue to work even if they had enough money to retire. Similarly, 28 per cent of retiring boomers who own their own business would also continue to work.
– Two-in-five (42 per cent) boomers started saving for retirement between the ages of 35 and 54. This is slightly higher for retiring boomers who own their own business with 43 per cent starting to save for retirement between these ages.
– Most boomers are doing some retirement planning (77 per cent).
– Almost all boomers have an RRSP (95 per cent). Ninety-eight per cent of retiring boomer business owners have an RRSP.
– The majority (64 per cent) of boomers who have an RRSP have already contributed to or plan to contribute to an RRSP for the 2008 tax year.
– Overall, more than two-in-five boomers with an RRSP plan to contribute the maximum allowable amount to their RRSPs.
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