RRSP INVESTMENT PLANS REMAIN TOP PRIORITY, SAYS SURVEY

B.C.'s economic slowdown does not appear to have affected consumers' retirement investment plans

RRSP INVESTMENT PLANS REMAIN TOP PRIORITY, SAYS SURVEY

The 1998 RRSP Survey of British Columbians was conducted by the Angus Reid Group between September 29 and October 19, 1998 on behalf of Credit Union Central of British Columbia. With a sample of 1,700 British Columbians across the province, the survey results are accurate to within plus or minus 2.5%, 19 times out of 20.

The margin of error will be larger for other sub-groupings of the survey population

RRSP INVESTMENT PLANS REMAIN TOP PRIORITY

B.C.'s economic slowdown does not appear to have affected consumers' retirement investment plans, according to an RRSP survey conducted on behalf of Credit Union Central of British Columbia.

In the survey of 1,700 British Columbians conducted this fall by the Angus Reid Group, 61 per cent of residents said they plan to make an RRSP contribution for the 1998 tax year, up from 46 per cent who actually made a contribution for the 1997 tax year.

Approximately half of respondents plan to contribute more or the same amount for the 1998 tax year. Of those planning to make a contribution, 24 per cent intend to contribute more than they did last year, while 26 per cent plan to contribute the same amount. Only 11 per cent of investors said they will contribute less than they did last year, while 38 per cent said they did not plan on making a contribution or didn't know.

"Despite the province's weak economic performance and continued stock market volatility, RRSPs remain an investment priority for the majority of British Columbians," said Wayne Nygren, President and CEO of Credit Union Central of British Columbia. "They recognize the benefits of using RRSPs to build a healthy retirement nest egg on a tax-deferred basis."

"Last August's stock market turmoil hasn't kept investors out of equities completely, but it would seem fewer RRSP contributors are planning to invest in mutual funds and stocks in 1998 than last year," said Nygren. Buoyed by years of robust returns in the stock market, the majority of RRSP contributors invested in equities in 1997 -- 61 per cent in mutual funds and 11 per cent in stocks. Today, 53 per cent of survey respondents said they plan to invest in mutual funds for their 1998 RRSP, while only eight per cent plan to directly invest in stocks for their RRSP.

"It's evident that declining stock prices combined with relatively low returns from fixed-income investments have left many investors confused as to where to put their 1998 RRSP contribution," added Nygren. Investors intending to put their RRSP contribution into Term Deposits or Guaranteed Investment Certificates have remained relatively constant from last year (19 per cent) to this year (22 per cent). However, 14 per cent are still undecided as to how they will invest their 1998 contribution.

"An RRSP is the single most important investment an individual can make as part of a long-term retirement planning strategy," said Nygren. "Unfortunately, many investors won't achieve their investment goals because they fail to adequately plan for their retirement years."

  • Some of the most common mistakes British Columbians make when planning for retirement include:
  • not contributing to an RRSP;
  • failing to stick to an investment plan;
  • waiting until the last minute to contribute to an RRSP; and
  • not contributing the maximum each year to an RRSP.

"One of the most astute moves British Columbians can make to ensure a comfortable retirement is to use the services of an investment advisor or financial planner, who can help them clarify their financial goals, tolerance for risk and investment time line, and then develop a sound investment plan," added Nygren.

British Columbia's Savings and Credit Unions provide a wide range of RRSP-eligible financial products, ranging from term deposits to mutual funds and securities. Most credit unions have staff available who can provide investment advice and help members develop investment plans. They can also provide a helpful 32-page booklet called "Understanding All the Basics", which provides clear and useful information on RRSPs.

B.C.'s Savings and Credit Unions form the widest financial services network in the province, with more than 325 branches serving 125 communities, including 29 that have no other financial institution. They are a significant force in the provincial economy, with more than $20 billion in assets and a workforce of some 7,000 employees.

The 1998 RRSP Survey of British Columbians was conducted by the Angus Reid Group between September 29 and October 19, 1998 on behalf of Credit Union Central of British Columbia. With a sample of 1,700 British Columbians across the province, the survey results are accurate to within plus or minus 2.5%, 19 times out of 20.

For further information, please contact

Wayne Nygren
President and Chief Executive Officer
Credit Union Central of British Columbia
(604) 737-5034
Maria Doyle
Manager, Marketing
Credit Union Central of British Columbia
(604) 730-6455

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