RRSP contributions continue to plunge: Report

No I will not get RRSP's ever again. You pay taxes on the amount when earned then have to pay again when you want to cash in your RRSP's. Double ticketing.Furthermore the bank pays cheap amount when they are using your money and making much more. It's a one sided program.
I don't trust banks or Government anymore.They are one of many rip offs and getting paid for it.

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You know what. I started this RRSP thing in the late seventies or early eighties. By the time the so call tech bubble hit around 1998, the total value of my saving was reduced by half. It has never ever regained the value in the following decade. By 2009, a good chunk of the value got knocked out again. I say no more RRSP for me. I think the whole thing is a scam perpetualted by the investment industry. These so called advisors are there only to make money for themselves.

RRSP overall is a good thing, it all depends from which angle you are looking from

More Common Sense.... the article is speaking to Canadians 34 and under. My comments were directed to those folks who posted that RSP's did not make sense because of OAS claw back. I am not sure where GIS supplement was brought into the picture?? The GIS supplement is meant for low income seniors, People who unfortunately are in a position where they didn't save enough, starting saving to late.... GIS has a purpose, I hope when I get to that age I won't rely on it, but don't begrudge people who need.. I guess if you are giving advice to a person under the age of 34 whose goal is to be a low income senior you may have point by not investing in RSP's. Most people who invest at a young age are obviously hoping for a retirement that will provide them with an income to live in a lifestyle in which will provide them the luxurys in which they desire in retirement. So is your advice to a 34 year old... spend it all, have fun, party, then qualify GIS at 65?? One of the best things about RSP's that TFSA's don't offer is the tax liability that exists if you take your money out. People think twice about withdrawing these investment knowing they will have to pay income on any withdrawls. RSP's have a true purpose... Retirement!! TFSA for certain individuals can be used for simply savings for trips, vehicles, or retirement. For a well desciplined individual TFSA's would be a better choice, as rarely people invest the tax return they receive from a RSP contrubtion. This article suggests obviously that most individuals are not that disciplined considering contributions are dropping....

Dear "common sense"...you are probably right that alot of people posting here are NOT under 34--myself included in that. However, now, in my early 40's...and it's too late for my husband and myself...we had gone into complete anxiety because of not knowing what we were going to do in retirement. We have both worked hard, but also made mistakes. So, it was nice to hear what "better common sense" was saying. I'm VERY happy for that post.
My best advice to the younger generation...you...if you're making 80 grand a year, at least and STILL spending wisely...then YES, DO RRSP's. However, that means you need an excellent job, from day one of your career. (Some DO have excellent careers...many don't.)
I had to defend "better common sense"...as he had some excellent information.

Thanks for your reponse Lisa.... I didn't mean to say that people under the age of 34 were the ones that were posting here. I simply meant that the article was talking about people under the age of 34 and how they are reducing the amount of their savings. I am not far behind you in age. I worry as well about retirement. I am no expert by any means, but I don't believe 40 is to late to invest. many people are working well into their 60's now. The first book i read on investing many years back was the Weathy Barber. In the book, his very simplistic approach to retirement was investing 10% of your income into something.... TFSA, RSP, GIC's.... whatever. Thats really easy to say, but he goes on to say that whatever that 10% amount is has to be like a bill payment. You have to put this money away first... before Tim Hortons, or fancy cell phones, or suppers out. It is very hard to do in real life though. Retirement is 20 years away assuming I work till 60. Thats a long time. You and I have lots of time, and you don't need to make huge amounts of money to invest in RSP's... to say that the RSP's are a scam (which I am not saying you said) is simply short-sighted. We each will determine what our retirement looks like and have choices that we make daily that will impact how in the end it will actually turn out. As much as government make me mad, I refuse to do nothing now then rely soley on them 20 years from now for OAS/CPP/GIS. I will do the best I can today with the choices I have. The only thing I expect from the Govt is CPP which I contribute to every two weeks... If OAS still exists thats a bonus...but that is it. Cheers!!

Bonaventure is correct that alot of Baby Boomers will be inherting from their parents, but since they also like to spend so freely, how far do you think that money will get them?

My own parents may well end up relying on said inheritance to live when they retire, and I fully expect to receive zero when they pass away. It's not that they've been irresponsible (in the traditional sense of over-splurging) with their money, just that they didn't plan for the contigency of everything not turning out as expected in their lives, i.e. their retirment funds not performing as high, extended economic problems in the region where I grew up, etc. They also knew that there would be an inheritance coming at some point, I don't think it made them greedy, it just failed to instill the heaviness of ones responsibility to save for retirement.

Believe me, when I say I am worried for my generation (the grey area between generations X and Y), from what I have seen many of my peers have adopted the same lassez-faire attitude from their parents, when in actual fact, I think they should be bloody well worried. Gone are the days of relying on CPP and certainly not an employer pension that may be drained by the time you actually retire.

I'm way too risk adverse to rely on money anywhere except from my own pocket when I hit retirement, ending up with too much is certainly more appealing than not enough.

I understand what you are saying "common sense." Just realize that different generations are looking at RRSP's or whatever they get, have, from different perspectives. You sound like you have your head screwed on straight for your age, and have not made many (if any) major mistakes.
Also..."piratekitty" made an excellent point. There are people who THINK they have a large inheritance coming. So, when they're in their 20's' or even 30's, they don't worry. Then, one parent dies saying the child will get a large lump sum. The other parent dies, and there's a small lump sum left. Through no fault of the child, they are now scrambling to figure out where their future finances will come from...because they trusted a parent who told them that they would inherit, without realizing the OTHER parent was thinking completely differently. That's hard.

I am 70 years old, and put my money in rrsp's.
Now let us have a closer look,In the last 2 years I lost$150,000.00 because of the reccession.
I lost buying power,A house would cost $15,000.00 3 bedroom brick same house now $250,000.00
At age 71 you have to take out 7.5% that is taxed. your pension+7.5% puts most people in the 40% tax breaket. So for every $100 received send $40 to the Governement.The Governement did nothing to help Seniors and their losses in the rrsp's. Pay your bills first.

I have read the comments about not contributing to rrsp's and the ones that say yes to them . It is my bellief that if you save the tax on the amount you contribute on income today , which on the top end equates to aprox (10% provincial )and26% federal) combined ,36% eg. $21000 x 36% is $7560 which you would otherwise pay in tax , but you don't , it goes into the RRSP and collects interest which would not be there if you don't deposit it , now here is the catch , I don't think it is wise to invest in high risk insturments, risky stock markets with high returns stated but not garrantied and also the principal stands to deminish as well as most of us have seen recently , even at 4% interest on $21000 is $840 per year , the truth is you are receiveing 4% on $7560 that would have gone to the tax department , so lets go back and see that $13440 is all you would have had to collect interest on and at 4% would be $537.60 and that would be taxable as well from a savings account and once again command 36% taxation ($193.54 ) leaving you with $344.06 in your pocket .Perhaps it is not fair to use these numbers , I am using tax rate #4 , 26 federal and 10% provincail hence 36% one could use tax rate #3 at 22 % if you like to see the difference as well . I would rather save a few dollars while I can without hopeing that I would rely on an inheritance which may not amount to much as people with no other income than cpp and old age pobably are going to need a lot of their money just to survive themselves ,beside the inheritor will probably do as always and just spend it like they have always done and things wouldn't change much in a short while . as for the government paying out cpp and old age and further if you qualify provincial subsidies , I would think that if a person spent everythng they earned while working and waited for all these things they would have lived a lavish life style and when retirement comes they will be very hard pressed to learn how to live on such meager amounts , it would make their lives that much more difficult ,I still believe one has to save something for a rainy day , even if it nevers rains it's always good to have an umbrella, just in case, This is just my opinion , would enjoy comments to see if I am off the wall on my view. I also like the tfsa which gives you the interest free of taxation but it would take many years contributing . I would preferr that any money a person saved , the interest should not be taxed at all , like that will ever happen , but at least $5000 a years interest falls in that catagory for now. I'll use it for what it's worth

Further to my last comment ,I would like to say that if you want something you still have to work for it , I know many people do not have the same chances to gain good income but no matter what your income is I believe you have to save something if only for personal money management, or you are living above your standard of living in accordance to your income , it is to easy to obtain credit and in the end you are really only giving your money away to credit card compaines and banks in interest payments , what I think is people should learn the idea that money is a tool and you have to learn how to make the tool work for you. eg, you can work for money , or you can save a bit and make it work for you , really that is what all these savings accounts are all about , relying on the government to cover you is ok if that is all you want , and relying on an inheritance to survive only says you couldn't do it yourself, and I'm sure that would make the parents proud !
I bit these statements will upset a few people but it is not my intent to do so , just speaking here .

As a young adult, my reservations about RRSPs is that, by the time I'm ready to retire, there will be nothing left for me. The baby boomers- majority of the current workforce, will have all retired and used up the available RRSP funds, leaving me having paid for this and not being able to receive it.

I guess that needs some minor expaning:
I will start by saying that I am no financial guru.
It is my understanding that the amounts retirees recieve can be higher than the amounts they contribute. When initiated, the population was stable from generation to generation, age to age, with few discrepencies.
However, the "Baby Boom" (my parents included) has placed a higher demand than forseen. It is witnessed in all areas of the lives of my generation- from the rapid decline of skilled trades, to the increasing demand for long-term healthcare. Their requirements for RRSP funds will outweigh my generations' ability to contribute (controversy notwithstanding), thus leaving myself and my peers with nothing when our time comes.

To Chelsy
It is your money , it earns interest on money that you would otherwise paidin tax , it has a double benefit. as for cpp if you worked and payed it you stand to get aprox $850 per month and then pay tax on that ,
Please believe me , a penny saved is a penny earned . think of it this way , if someone gave you money but you could not spend it for a period of time but could keep it in the bank and collect interest on it , and keep the interest for later , would you not think that was a good thing?
If you put money in an RRSP , it is yours , the baby boomers will never receive any of it , that money is yours , when you draw it out , it becomes your income just like today yuou get a pay cheque and pay tax on and get to spend the rest as you see fit , this is good , Look around and watch how people live from pay cheque to pay cheque today , can you see yourself doing that when you retire ? counting only on the cpp cheque , ? this is and has been a very thought I have always been not wanting to endue .
If you save some money and learn to control your spending and watch the places you spend it , that is fine , just always save a little for that rainy day , you must know people who have no pensions and have to watch every cent to make ends meet , very sad to see after many years of working to end up that way . costs continue to increase but your pension will never keep up with inflation or the gas bill or the powewr bill . Please reread what I stated before and apply it to your life and see if it makes scence to you ? it was only offered to explain to many who do not truely understand what RRSP"S are about .

further to what you are saying , I beleive you are confusing CPP with RRSP , CPP is Canadian pension which you contribute to as an employee and your employer contributes half as well , that may become depleted but not likely , the next generations will have to contribute more fro thier work than we do now . RRSP is yours only , It does not get dispersed amoung any one else , it is yours , it is the extra that you will receive above the CPP pension what ever that may be , do not worry , saving teaches a lot , spending has it"s joy as well but thinking about what you spend your money on before you spend it builds character and wisdom .

Once again it gives me enjoyment to see a young person open minded enough to say I don't understand , but wise enough to ask for an explaination , I hope I have provided that for you ,? Don't worry , enjoy life , just remember an umbrella is very handy should it rain , and even if it doesn't , you were prepared
To Chelsy