Rising costs are undermining Canadians’ confidence in their retirement plans, with nearly three-quarters saying inflation has increased concerns about having enough savings for their later years, according to a new survey by BMO Financial Group.
The poll found 74 per cent of respondents said rising prices have heightened worries about having sufficient money saved for retirement, while 66 per cent reported inflation is already affecting their ability to save and invest.
The findings point to mounting pressure on household finances as Canadians balance day-to-day expenses with long-term financial planning.
Savings strategies under strain
Among those who said inflation was negatively affecting their finances, nearly half — 47 per cent — estimated they are spending an additional $100 to $300 per month on necessities. Another 34 per cent said their monthly expenses have risen by more than $300.
In response, some Canadians are adjusting their retirement savings strategies:
31% are contributing less to retirement savings
27% are cutting back on spending to maintain their savings contributions
17% have postponed retirement savings entirely
Brent Joyce
“Inflation is a threat to retirement savings, but it doesn’t have to derail our clients’ plans,” said Brent Joyce, Chief Investment Strategist, BMO Private Wealth. “The key is to stay invested and take a proactive approach. By incorporating inflation assumptions into comprehensive financial plans, we help Canadians understand how their portfolios can perform over decades – not just years. With disciplined investing and expert guidance, clients can ensure their money grows faster than inflation and supports the lifestyle they’ve envisioned.”
Uncertainty over how long savings will last
The survey also suggests a lack of clarity among Canadians about how long their retirement savings will sustain them.
Three in 10 respondents said they do not know how long their money will last once they stop working. Among those who provided an estimate, 22 per cent believe their savings will last between 10 and 19 years, while 13 per cent expect their nest egg to last more than 30 years.
“Comprehensive financial and wealth planning is essential to providing clarity – especially when navigating complex and ever-changing variables like inflation. A customized, holistic wealth planning approach helps clients understand how these factors interact and what savings and investment strategies are required to meet their long-term retirement goals,” said Paul Lalonde, Head of Wealth Planning, BMO Private Wealth Canada. “By modelling a range of possible futures and tailoring strategies to each client’s circumstances, we help transform uncertainty into confidence. In the end, thoughtful planning provides the peace of mind Canadians need as they look ahead to retirement.”
Paul Lalonde
Some look abroad in retirement
The survey indicates some Canadians are considering relocation as part of their retirement planning.
About three in 10 respondents said they plan to move to another city in retirement. Of those, roughly half intend to relocate to another country. Overall, 15 per cent of Canadians are planning to retire outside Canada.
Among respondents considering an international move, 58 per cent expect living costs to be lower, including 32 per cent who anticipate costs will be significantly lower. At the same time, 30 per cent believe retiring abroad to their chosen destination will be more expensive.
Regionally, Ontarians were the most likely to envision retiring in another country at 18 per cent, followed by British Columbia at 16 per cent, Saskatchewan and Manitoba at 16 per cent, Alberta at 13 per cent, the Atlantic provinces at 12 per cent and Quebec at 11 per cent.
Retirement planning considerations
For Canadians planning for retirement and seeking to maximize registered retirement savings plan contributions, BMO outlined several considerations:
Start planning early by defining retirement objectives and long-term financial goals to determine appropriate investing and savings strategies.
Practice discipline by managing spending, reviewing budgets and maintaining continuous savings plans as a regular expense, adjusting contributions as needed.
Contribute securities to an RRSP, as contributions do not have to be made in cash and securities can be transferred in-kind to a qualified plan.
Seek professional advice to monitor portfolios and recommend strategies based on financial circumstances, risk tolerance and long-term goals.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Entrepreneur. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 and 2024 as one of the top business journalists in the world by PR News. He was also named by RETHINK to its global list of Top Retail Experts 2024, 2025 and 2026.
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