The use of target-date funds is on the rise in Canada, with more members of capital accumulation plans being offered the investment option every year. Half of plan sponsors with defined contribution plans (50 per cent) and group registered retirement savings plans (51 per cent) allocated target-date funds as their default option in 2016, according […]
Canadian plan sponsors aren’t satisfied with the retirement products available for capital accumulation plans and aren’t especially confident their members will have the income they need in retirement, according to a new survey by Schroders. “Most people didn’t feel that what was out there was going to allow people to retire with a high enough income,” said […]
Franklin Templeton Investments Corp. is adding a suite of target-date funds to its offerings in Canada. Franklin LifeSmart is expanding to four new funds, covering new increments 2025, 2035, 2045 and 2055, adding to the current line up of 2020, 2030, 2040 and 2050. “As employee workplace savings plans continue to grow in popularity across Canada, demand for target-date funds […]
From decumulation options to investment choice, capital accumulation plan members face several challenges when they reach retirement. On the decumulation front, many members leave their assets with their final employer’s pension provider, which offers group registered retirement income funds or life income funds with well-managed investment options and lower management fees. As well, an increasing number […]
Despite his death earlier this year, Ikea founder Ingvar Kamprad’s influence lives on at the international furniture behemoth. The notoriously frugal Kamprad reportedly flew economy class, whether for company or personal travel, and drove an old Volvo. The iconic Swedish retailer remains committed to operating within the guidelines set by his 1976 treatise, “The testament of […]
When Searles Valley Minerals Inc. upgraded its pension plan offerings, the situation appeared complicated. The average age of the 761 plan participants at the Kansas-based mining company was 47, and turnover was low. With many employees anchored in their careers, lifestyles and habits, change wasn’t necessarily a priority. “Inertia can be a powerful force,” said […]
While managers of target-date funds have benefited from strong tailwinds in recent years, how can they manage the current environment of uncertainty? Ruthann Pritchard, an institutional portfolio manager at Fidelity Investments, cited the favourable conditions of 2017 and the healthy markets of the last nine years as examples of trends that often end abruptly before […]
With markets showing signs of potential extreme volatility in recent weeks, how can employers address the many questions that arise from pension plan members? When speaking to members, consultants usually emphasize advice on asset allocation based on age and risk tolerance. Many members aren’t honest in their responses, often overstating their tolerance for risk because markets are typically on the rise. […]
Net returns in defined benefit pension plans were higher than net returns in defined contribution plans by an average of 0.46 per cent annually over the last 10 years, according to new research by CEM Benchmarking Inc. That compares to the 1.8 per cent difference the last time the organization compared the performance, for the period […]
Target-date funds seek to provide members of defined contribution pension plans with a straightforward experience, adjusting their asset mix in a set-it-and-forget-it option geared towards achieving acceptable retirement outcomes. But the target-date fund world is diverse. There are differing features, including active and passive underlying funds, glide paths that go to or through a retirement date, […]