The average savings rate by age per year can provide you with valuable insights into your financial habits and goals. By comparing your savings rate to the average for your age group, you can determine if you’re saving enough money for your future needs, such as retirement or a down payment on a house.
If you’re saving more than the average, you can feel confident that you’re on the right track and may even be able to set more ambitious financial goals. However, if you’re saving less than the average, you may want to re-evaluate your spending habits and make adjustments to ensure that you’re saving enough to meet your future needs. By paying attention to the average savings rate metric and taking steps to improve your savings habits, you can set yourself up for a more secure and financially stable future.
When it comes to saving money, the amount you’re able to save can depend on your income. For example, according to the latest data from StatCanada,
Lower-income Canadian households save an average of $852 per year, while the highest-earning Canadians are able to save over $41,000
This considerable discrepancy between the savings rate of low income and high income households can be explained with the fact that Canadians with higher incomes typically have more money left over after paying their expenses, which they can put towards savings. Whether you’re a young adult just starting your career or have retired, understanding the average savings rate per year for your age group can help you set realistic financial goals and make informed decisions about your finances.
But what about the average savings by age in Canada? How much are Canadians able to save each year? In this article, we shall provide you with all the information you need to know about the average savings rate per year for Canadians of different age groups. This way, you can see how your savings habits compare to others in your age group. Continue reading as we explain to you the average savings by age in Canada.
How does StatCanada record the average savings in Canada?
To figure out the average yearly savings by age in Canada, StatCanada uses a few different methods. One way is by conducting a survey called the Survey of Financial Security, which asks people about their finances. StatCanada also looks at other sources of information like tax records and bank account data to get a better understanding of how much money people are saving. By using different methods together, StatCanada is able to get a more accurate idea of how much money people of different ages in Canada are saving each year. Given below is a year over year record of the average savings by age groups.
Average household net saving by age group of major income earner, dollars
Second quarter 2020 Second quarter 2021 Second quarter 2022
65 years and over -471 -3,447 -5,260
55 to 64 years 4,789 1,856 -1,932
45 to 54 years 9,963 4,807 3,998
35 to 44 years 9,647 6,907 6,020
Less than 35 years 8,460 5,586 3,423
Table link: https://www150.statcan.gc.ca/n1/daily-quotidien/221003/cg-b005-eng.htm
The table explained..
Saving money can be a challenge, especially during tough economic times. The table showing the average savings in dollars by age group in Canada over the past couple of years is an interesting snapshot of the state of people’s finances. It is apparent that different age groups have experienced varying levels of success when it comes to saving money.
Ages 65 and over
Retirees aged 65 and over have seen a significant decline in their average savings rate, from -$471 in the second quarter of 2020 to -$5,260 in the second quarter of 2022. This could be due to the fact that they are using their savings to cover living expenses and medical bills, which is a common issue faced by many of those belonging to this age group. With retirement looming or already in progress, this group may be drawing on their savings to make ends meet, resulting in a lower average savings rate.
Ages 45-54 yrs
Those in the 45 to 54 age group have had the highest average savings rate over the past couple of years. They had an average savings of $9,963 in the second quarter of 2020, which increased to $4,807 in the second quarter of 2021, and slightly decreased to $3,998 in the second quarter of 2022.
The reason for the highest savings rate could be explained by the fact that this age group is in the prime of their careers, and is often more established in their careers and may be earning more than their younger counterparts, allowing them to save more. They may also have fewer financial obligations, such as mortgages and child-rearing expenses, freeing up more funds for savings.
Ages 55-64 yrs
The savings rate for those aged 55 to 64 started out strong in the second quarter of 2020 with an average savings of $4,789. However, their savings decreased significantly in the second quarter of 2021 to $1,856 and even further to -$1,932 in the second quarter of 2022. This suggests that this age group has faced challenges in saving money over the past couple of years.
Ages 35-44 yrs
For those aged 35 to 44 years old and under 35 years old, savings have remained relatively stable over the past couple of years, with slight fluctuations up and down. Understanding the average savings rate for your age group can help you set realistic financial goals and make informed decisions about your savings habits. The data by StatCanada shows that saving money is not easy for everyone, but there are age groups that seem to have more success in this area than others.
Conclusion
By understanding the average savings rate per year for your age group, you can gain insight into the financial habits of your peers and set realistic goals for yourself. You may discover that you’re saving more than the average person in your age group, which can give you a sense of confidence and motivation to continue on your savings journey.
Alternatively, you may find that you’re not saving as much as you should be and need to make some adjustments to your spending habits. Whatever your situation may be, knowing the average savings rate per year can help you take control of your finances and make your money work harder for you.
