A bleak picture for Generation Y’s retirement

A recent report from one
of Canada’s major banks paints a bleak picture for young adults saving up for
retirement. 

The report, entitled “Canadians’
Retirement Future: Mind the Gap” was published by CIBC, and suggests that young workers
will have a much lower standard of living (in relation to what they have
currently) compared to those who have already retired.  

For Generation Y, that
means an average 30 per cent reduction in standard of living upon retirement,
as opposed to those born in the 1940s, who are enjoying roughly the same living
standard as they did in their earning years.  

The report points to
low interest rates on savings, compounded by lower returns on investments and
lesser quality company pensions as the reason behind this.  

Bryden says
she encourages clients to begin saving early. 

“I can
remember starting myself when I was 18, a monthly contribution, and the earlier
you start, the better. As soon as you start working, you should start saving,”
she said. 

Phyllis and
Frank Conger are an example of a couple who have saved up and are now retired.
They say they are worried that younger generations aren’t able to do the same. 

“My
children are in their 50s and I think they’re planning pretty well now, but
anybody younger than that, I don’t think they can afford to,” said Phyllis
Conger. “Because if they work for minimum wage, they can’t even pay their rent.” 

However, for
many people just about to enter the workforce, retirement planning is the last
thing on their minds. 

“Most of
the people I know, they’re just living in the moment,” said university student
Neio Waghela.