Although contributing to long-term investments for retirement is Canadians’ leading financial priority1, there always seems to be a good reason to delay saving. You may be working to pay off a student loan, saving to purchase a home or you may think you can only start when you have a significant amount to contribute.

However, the fact is it’s never too early to start saving for retirement. Once you start working and can set aside even a small amount each month, you can be well on your way to building a healthy nest egg. The earlier you start, the better off you’ll be because your retirement savings will have more time to grow.

Let’s look at the impact of delaying saving for retirement 

1.        Susan and Mark would both like to retire at age 65.

2.       Susan starts saving $100 biweekly when she’s 30.

3.       Mark decides to put off saving until he’s 45 but will contribute twice as much – $200 biweekly – to help catch up. 

  • At age 65, Susan will have contributed $91,000 in 35 years, while Mark will have contributed $104,000 in 20 years. However, Susan will actually retire with $64,510 more than Mark – even though she contributed $13,000 less.
  • With more time on her side to grow her savings (15 years more) and the benefit of compound growth, Susan’s $91,000 contribution grew to $240,882, while Mark’s $104,000 contribution grew to $176,372 ($64,510 less than Susan). 

Time is your biggest ally when it comes to saving 

You can start by contributing a small amount each month; as you earn more in your career, you can increase the amount

Your money will have more time to benefit from compound growth

Talk to your Scotiabank advisor today about building a financial plan that will help you maximize time to achieve the retirement you would like. Try out the Retirement Savings Calculator to help you get started.

What is compound interest? 

Compound interest is a way of determining interest whereby the addition of interest over time is added to the principal amount. You not only earn interest on the principal amount, you also earn interest on your interest, and interest on that interest, and on and on. Saving over a longer period of time allows your money more time to grow and to benefit from compound interest. 

Compound interest is the eighth wonder of the world.
-Albert Einstein

Pre-Authorized Contributions (PACs)   

Make investing for long-term goals easy and affordable. 

The beauty of a PAC is that it’s automatic. You choose the amount you want to save and how often you want to save – for instance, weekly, biweekly or monthly. Once it’s set up, you’ll be saving money without even thinking about it. You can adjust the amount and frequency at any point in time.

Don’t set it and forget it

As you get older, it’s likely your cash flow will improve. While many Canadians are saving on a monthly basis, many forget to adjust their plan as their financial circumstances change. It’s a good idea to revisit your PAC contributions on a regular basis – especially after major changes, like paying off student debt or landing a promotion. While it’s tempting to just set it and forget, you’ll be amazed by how much more you can save by increasing your contributions – even a little bit. 

In Figure B, we look at an investor who contributes $200 monthly for 15 years versus the same investor increasing their monthly contribution by just $25 each year.


Investing on a regular basis through PACs is a great way to build your savings easily and automatically. Try our interactive PAC video to see how your savings can grow. Speak with a Scotiabank advisor to set up a PAC that meets your needs.

Retirement facts and figures @ a glance