Nearly nine in 10 Canadian homeowners surveyed recently said that being debt-free was key to their idea of a successful retirement — even more than most lifestyle factors.
Only having good health was listed by more people, according to the survey of about 2,000 Canadian homeowners conducted for Manulife Bank.
The dream of being debt-free was more important to the respondents than living near family, keeping busy with a hobby or volunteer work or having a broad group of friends.
“The results from this survey strongly support the fact that, for a successful retirement, people need to pay close attention to not just their retirement savings, but debt repayment as well,” said Doug Conick, president and CEO of Manulife Bank of Canada.
Just over half of the survey respondents said they were confident they will be debt free when they reach their planned retirement age and about half said they have less debt than they did 12 months ago.
“It’s encouraging to see younger homeowners express optimism about becoming debt-free. However, the experience of more seasoned homeowners, revealed by our survey, underscores the importance of developing a concrete debt-reduction plan and sticking to it.”
Some recent indications have suggested more people are carrying debt into their retirement years, a worrying trend that is forcing some to keep working.
The poll found that 87 per cent of the respondents indicated that being debt-free was very important to their definition of a successful retirement.
That was slightly more than the 85 per cent who said that it was very important to have sufficient income to maintain their current lifestyle.
Having good health was listed as very important by 94 per cent of the respondents.
Other non-financial factors paled by comparison, with only 62 per cent of respondents saying that living near family was very important.
Keeping busy with a hobby or volunteer work was important to 64 per cent of the respondents.
Around the world, a retirement crisis looms as debt-strapped countries scale back benefits, raise the retirement age or make other moves to deal with rising obligations and weak economies.
The retirement issue is coming to the fore as the workforce ages and baby boomers are set to retire in the coming years, leaving fewer employees to pay into benefit plans and more drawing from them.
Meanwhile, the Bank of Canada and some economists have warned that Canadians are piling on too much debt while interest rates are low, and some may no longer be able to afford their homes when interest rates rise.
The online poll surveyed 2,003 Canadian homeowners between ages 30 to 59 with household income of more than $50,000. It was conducted online by between March 5 and March 16 for Manulife by Research House.
Manulife Bank is part of Manulife Financial Corp. , which operates Canada’s largest life insurance company.