BMO RRSP Study: Planned RRSP Contributions Increase by 47 Per Cent, But Knowledge of the Account's Features and Benefits Continue to Falter

TORONTO, Feb. 24, 2022 /CNW/ - BMO Financial Group's 12^th annual Registered Retirement Savings Plan (RRSP) Study revealed Canadians have continued to prioritize retirement planning despite the financial challenges from the pandemic and expectations of rising inflation. The study found that among the 60 per cent of Canadians with an RRSP, respondents on average plan on contributing $6,822 to their account, a 47 per cent increase since 2020.

The average amount held in RRSPs nationally is $141,923, a 26 per cent increase from 2020 ($112,295).

Region	Average Amounts Held in RRSPs	Average RRSP Contributions
Atlantic	$149,474	$2,660
Quebec	$98,667	$4,781
Ontario	$172,153	$6,877
Prairies	$241,309	$8,293
Alberta	$139,472	$11,410
B.C.	$166,001	$11,983
National	$141,923	$6,822

"Despite the uncertainty from the pandemic and increased costs of living due to rising inflation, Canadians continue to prepare for their financial future by making the important investments into their retirement plans," said Robert Armstrong, Director, Multi-Asset Solutions, BMO Global Asset Management. "With retirement planning and RRSP contributions remaining a priority, we encourage Canadians to continue to maximize the full benefits of the account ahead of the RRSP contribution deadline."

Despite Contribution Growth, RRSP Literacy Is Declining

While Canadians continue to utilize RRSPs for retirement planning, the study found their knowledge about the account has declined over the past five years:

• Slightly more than half (56 per cent) of respondents know how much they can contribute to the account, a six per cent decrease since 2016.
• Fewer than half (47 per cent) of Canadians are aware of what investments are eligible to be held in RRSPs, a five per cent decrease since 2016.
• While more than half (56 per cent) of RRSP investors are aware that mutual funds are eligible for RRSPs, that knowledge has decreased by 15 per cent since 2016. Fewer than half of Canadians are aware that RRSPs can hold cash (47 per cent) and ETFs (45 per cent).

"While it is encouraging to see Canadians continuing to rely on effective retirement planning tools like RRSPs, working with a professional advisor can help investors understand the account's benefits, develop a personalized plan that will maximize its full potential and help Canadians achieve their retirement goals," said Mr. Armstrong.

Women and Retirement

The survey also identified a gender gap in approaches to and knowledge about retirement planning:

• Women are 12 per cent less likely to have an RRSP and know the differences between an RRSP and TFSA compared to men.
• Women are 17 per cent less likely to know how to contribute and how much can be contributed to an RRSP compared to men.
• Only 36 per cent of women are aware of which investments are eligible in an RRSP, compared to 59 per cent of men.
• Women are 20 per cent less confident than men that they will have enough to retire as planned.
• Women are eight per cent more likely to rely on a financial advisor when making investment decisions compared to men. Women are also nine per cent more likely to contribute to RRSPs under the recommendation of a financial advisor.

"Facing evolving social expectations, more professional opportunities and longer life expectancies, women will need to approach retirement planning according to their unique circumstances and financial goals," said Gayle Ramsay, Head, Everyday Banking and Customer Growth, BMO Bank of Montreal. "As we look for paths towards an inclusive and thriving post-pandemic economic recovery, we encourage women to seek professional advice so they will be empowered to make confident investment decisions and make real financial progress towards their long- and short-term financial goals."

BMO offers the following resources for women interested in building their confidence in personal finance, investing and wealth planning:

• BMOforWomen.com is regularly updated with content to help inspire financial confidence.
• The award-winning¹ podcast Bold(h)er features inspiring stories of women making bold moves in their careers and businesses.
• BMO investment professionals provide access to online training to promote and engage women investors and business owners in tailored, goals-based conversations.

For more information on Registered Retirement Savings Plans, opening an account, or other assistance, please visit www.bmo.com/rrsp.

¹BMO for Women's Bold(h)er podcast received recognitions from Hermes Creative Awards Platinum and AVA Gold

The BMO RRSP Study was conducted by Pollara Strategic Insights via an online survey of 1,500 adult Canadians conducted between October 26th and 29th 2021. The margin of error for a probability sample of this size is ± 2.5%, 19 times out of 20.

About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly diversified financial services provider - the 8th largest bank, by assets, in North America. With total assets of $988 billion as of October 31, 2021, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.

SOURCE BMO Financial Group

Media Contact: Anke Suwanda, Toronto, [email protected], [phone]