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Senior man and woman worrying about retirement

About four-in-10 respondents to a new BMO study say they aren't confident in their ability to save for retirement and the same amount are relying on the value of their home to help fund their retirement.

The BMO Retirement Institute survey conducted by Harris Decima also finds that one-third believe living comfortably in retirement is the most important financial goal.

However, the findings of the poll of 1,002 Canadian respondents suggests that many don't think they're doing enough to reach that dream.

About 40 per cent say they're not confident they can save enough to fund their ideal retirement plans, while 29 per cent expect to have to delay retirement or work part-time due to a shortfall in savings.

And 41 per cent consider the equity they are building in their homes as an alternative source of funding their post-work plans.

BMO warns that using a home as a nest egg is a risky idea and that personal savings must play a role in retirement planning.

"The reliance on home equity to fund retirement is no surprise, given that almost half of Canadians say that their home is their biggest financial asset and, on average, accounts for half of their total net worth," said Marlena Pospiech, retirement strategist at BMO Retirement Institute.

"While it is true that, in the past, Canadians have enjoyed a stable housing market and increasing real estate values, there is no guarantee that this trend will continue. As a result, individuals shouldn't count exclusively on their homes to fund their retirement and should be focused on building up their personal retirement savings."

According to the report, one-third of Boomers who intend to sell or have sold their home do so to supplement their retirement income.

But BMO says while homeowners have seen values rise in recent years, an influx of Boomers selling their homes as the population ages in the next few years could drive prices down.

Meanwhile, recent studies suggest many Boomers are carrying debt into their retirement.

Canadians are taking on debt like never before. The latest figures from Statistics Canada show the household debt to income ratio has risen to a record high of 163 per cent, about the level reached in the United States before the housing crash of 2007-08.

Some experts have suggested older Canadians are being lured by low interest rates into piling on debt, something that could hurt their future living standards.