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One of the most common questions we hear from people is, “how much do I need to retire comfortably?” And from those who are already retired, “do I have enough to support my spending for the rest of my life?”
It’s our job as wealth advisors to run the sophisticated and detailed analysis that provides the assurance — or occasionally, the cold water dousing that says savings and spending habits need to be changed.
We had our quarterly visit from Maureen Farrow last week. (Maureen is a highly-respected Canadian economist whom we retain to provide us with economic analysis and briefings.)
All things being equal given the tough economy,she’s feeling relatively bullish about Canada’s prospects these days. There is an unusual amount of global investor interest in our country and with good reason.
After all, it’s no secret that Canada has survived the financial crisis better than almost all other major industrialized nations of the world.
Together with 120 other entrepreneurs from CEO Global (a Toronto-based CEO coaching organization), I spent a morning two weeks ago listening to Christophe Morin, marketing guru and author of Neuromarketing: Understanding the Buy Buttons in Your Customer’s Brain
The premise of the book – and the talk – was that we can use the latest brain research toredefine our sales messages and deliver them with more impact by better understanding how people make buying decisions.
I just finished reviewing the annual reports for a Group RRSP and Deferred Profit Sharing Plan (DPSP) on behalf of a client who has one in place for his employees. On paper everything seems just fine. The investment climate is improving and on average every employee seems to be doing much better this year than last. But once I got beyond the glossy graphs certain issues started to become apparent.
Many employees hadn’t yet chosen an investment plan and were defaulting to the option chosen by their employer. A significant number of employees were withdrawing funds from their plans, presumably to supplement their current income. Most employees weren’t on track to meet their retirement savings goals. An education program for his employees wasn’t in place.
That’s not good for employees – and it’s not good for employers, who have a liability they may not be aware of. In 2004, the Canadian Association of Pension Supervisory Authorities issued guidelines for Capital Accumulation Plans (CAP) which refers to “a tax assisted investment or savings plan that permits the members of the CAP to make investment decisions among two or more options”.
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