Although economic fundamentals in Canada are improving, the issue of retirement remains several fries short of a happy meal.
The latest Russell Financial Health Index, an online calculator that gauges the overall financial health of Canadian investors, revealed that Canadians feel unsettled about retirement, particularly women who are less positive about their financial health in retirement than men. Older Canadians, though, are less concerned.
“We are encouraged that much of the global economy continues to transition from recovery to expansion, and we are seeing increasingly stronger fundamentals,” said Keith Pangretitsch, director of national sales with Russell Investments Canada. “Nonetheless, recent Black Swan events, such as Japan’s earthquake and nuclear crisis, as well as, the ongoing crisis in the Middle East, seem to be giving some Canadians pause.”
One segment of respondents that wasn’t as concerned this quarter were older or retired Canadians, who exhibited a more positive attitude about their financial health. “While this seems counterintuitive, it may be related to their more experienced and ‘settled’ state in these unsettled times,” said Pangretitsch.
The index noted that recent global events have brought about a shift towards greater concern about retirement this year compared to the last year when Canadians were beginning to feel the economy was turning the corner.
What is particularly noteworthy in the first quarter of this year, is the shift in sentiment about what is worrying Canadians as they think about retirement, added Pangretitsch.
Reducing debt or borrowing, family needing financial help, reducing fixed costs for greater flexibility and the financial impact of a partner/spouse’s death are some of the biggest sources of worry among Canadians in the first quarter of 2011.
In the fourth quarter of 2010, however, it was all about leading an active and healthy lifestyle in retirement and having a reliable source of income for their desired retirement lifestyle.