- Originally from our sister publication, Advisor.ca.
Ongoing market volatility and global unrest continue to leave Canadians feeling unsettled about retirement, according to the most recent results of the Russell Financial Health Index.
The second quarter reading of the online tool shows financial health has declined to the lowest level since inception in late 2008. The main retirement concerns for Canadians include having a reliable source of income and whether that income will be sufficient to cover essentials.
“While the reality is that we continue to see strengthening fundamentals in our economy, it’s not surprising that Canadians continue to feel uneasy, given the recent crush of unsettling news—from governments on the brink of bankruptcy to the fear of inflation,” said Keith Pangretitsch, director of national sales at Russell Investments Canada.
“Although it’s important to keep an eye on both the broad economy as well as key indicators in the market, it’s even more important for Canadians to avoid becoming distracted by short-term market moves and big news stories, and focus on the fact that a broad diversification along with the appropriate asset allocation for their situation is the best defence against these macro-shocks.”
To a lesser extent, three other factors also contributed to the decline of the Russell Financial Health Index this quarter: leaving assets/inheritance to beneficiaries, maximizing tax efficiency of investments and having reliable, trustworthy advice.
The Russell Financial Health Index—an online calculator that gauges the overall financial health of Canadian investors—decreased to 44.18, down roughly four full points from the 48.00 range of the last three quarters.