Money falls from the family tree into the hands of retiring boomers, RBC poll finds
More than half of Canadians in their fifties (57 per cent) have received or are expecting to receive money from their parents and in-laws, according to the results of an RBC poll. As a result of the largest and most anticipated transfer of wealth in history, many boomers say they will do things differently than their parents when it comes to bequeathing their wealth.
“Boomers are expected to inherit up to $1 trillion from their parents,” said Mike Reed, head, retirement and affluent client strategy, RBC. “Given the enormous amount of wealth that will change hands within the next decade, this transfer needs to be managed effectively through proper planning, particularly as people head into retirement.”
Approximately three in five respondents in their fifties (61 per cent) expect to give money, during their lifetime, to their own adult children. Of those, more than two in three (69 per cent) say they will do so because they want to see their children enjoy their lives.
While a majority of those in their fifties expect to give money to their adult children, nearly one in ten (7 per cent) respondents say that they would not, believing that their children need to earn their own way or wait until their parent dies. Other respondents say that they will need the money themselves or that their children do not handle money very well.
Although Canadians in their fifties have considered who will benefit from their accumulated wealth, three-in-ten (29 per cent) feel that they have not given enough consideration to their legacy. When contemplating their legacy, seven in ten respondents (70 per cent) feel strongly that they want to be remembered as a person who enjoyed time with their family. This family focus is also reflected in the finding that four in five of those in their fifties (81 per cent) believe that their children are their legacy.
Despite their family orientation, boomers are not confident that their efforts to support them will be sufficient, only one-in-five (20 per cent) respondents in their fifties believe they have done enough to make sure that their family will be okay.
“One message that came through clearly in our research is that, for most people, family comes first - and this finding is echoed in our experience with clients who participate in our retirement life planning program Your Future by Design,” commented Reed.
The RBC Retiring Boomers Poll was conducted by Ipsos Reid from August 3 to 8, 2007. The online survey was based on responses from 1,225 adult Canadians between the ages of 50 and 59 with household assets of $100,000 or more. With a sample of this size, the results are considered accurate to within ±2.8 percentage points, 19 times out of 20, of what they would have been had the entire adult Canadian population been polled. The margin of error will be larger within regions and for other sub-groupings of the survey population.
Your Future by Design® is RBC’s distinctive approach to help clients identify, plan, and realize their goals for retirement. With the guidance of RBC financial planners and investment and retirement planners, Your Future by Design helps clients create a blueprint for a successful lifestyle and financial plan for retirement based on what is truly important to them in key areas in life, including family, health, home, lifestyle, work/business, mind and spirit, and legacy. To find out more about how RBC can help build a blueprint for the future, visit www.rbc.com/yourfuture or call 1-866-335-4055.
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