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Most Canadians saving cash for retirement

Most Canadians saving cash for retirement

Many Canadians have every intention to exit the workforce by the time they reach the appropriate age and enter retirement life. And while they may not be working quite like they used to - whether at all or only part-time - they're saving up now so they have currency, including polymer notes, to spend later, Census data shows, a sure sign business owners will need to keep their cash counters handy for the foreseeable future.

Close to 66 percent of households in Canada are putting money aside for them to use when they reach retirement age, according to the most recent Census report from Statistics Canada. More specifically, 65 percent of Canada's 14 million households paid into a Registered Retirement Savings Plan (RRSP) or Tax-Free Savings Account (TFSA) in 2015, CBC News reported from the Census.

March 1 cutoff for RRSP contributions

Canadians only have so much time in a given year to contribute to their RRSPs, with this year's deadline being March 1. In 2018, nearly 50 percent of RRSP owners have or planned on contributing to their RRSPs, based on separate data from BMO Financial Group.

Fred Vettese, chief actuary at Morneau Shepell, told CBC News income-earning Canadians, for the most part, are indeed readying themselves for the post-career world, setting aside money often.

"I think things in general are still in pretty good shape when it comes to preparing for retirement," Vettese explained. "For the most part, when you look at middle-income Canadians, they are saving."

Most transactions done in cash

Because cash is accepted virtually everywhere, all that money Canadians are setting aside could end up being processed by a money counter, should said currency, including polymer notes, be spent at retailers or casinos. More than half - 54 per cent - of all transactions at small and mid-sized businesses are in cash, according to estimates from the Bank of Canada. A plurality of transactions at large businesses are also conducted in cash (48 per cent).

Current payment and purchase obligations do, however, prevent some Canadians from saving as much as they'd like to. Twenty-three per cent of Canadians chalk not contributing to their RRSPs this year to important expenses, according to the poll from BMO Financial.

Robert Armstrong, vice president of multi-asset solutions at BMO, advises individuals to speak with a financial professional, who can provide tips on how to balance saving with spending.