Fidelity Retirement Index finds Canadians on track for 50% pay cut in retirement



    Are Canadians ready to significantly reduce their retirement lifestyle?

    TORONTO, Oct. 23 /CNW/ - Fidelity Investments Canada ULC today announced
the launch of its new Retirement Index which measures how financially prepared
working Canadian households are for retirement. This research shows that
Canadian households are on track to replace only 50% of their pre-retirement
income in retirement.
    "The Fidelity Retirement Index is the new definitive standard Canadians
can use to measure how prepared we are for retirement," said Peter Drake,
Vice President, Economic and Retirement Research, Fidelity Investments. "It
provides a clear answer to the number one question Canadians have about
retirement: "Will I have enough?"
    The Index analyses the broad financial picture of Canadian households
including workplace and individual savings, projected asset growth, future
savings, projected government sources of income and pension benefits, expected
retirement horizon and longevity.
    Earlier this year, Fidelity released research that concluded that
individuals who want to maintain their current lifestyle in retirement should
aim to replace about 80% of their pre-retirement income. The Index results
clearly show the gap between this benchmark target and where Canadians are
today. "By introducing the Fidelity Retirement Index, we hope to spark
Canadians into action to start planning and saving for their future," added
Drake.

    What does this mean for Canadians?

    "Many retirees are not planning to cut back on their lifestyles in
retirement," said Drake. "Instead, Canadians are retiring earlier, living
longer, and leading more active lives in retirement than ever before.
Unfortunately, a 50% retirement income replacement rate shows that most
Canadians aren't financially prepared for the full life they are looking for
in retirement."
    More than ever before, individuals are shouldering the responsibility of
funding their own retirement. In addition to relying on savings, pensions, and
government benefits, the majority of Canadians (59%) plan to work at least
part-time in their retirement. Twenty-six per cent expect to use the proceeds
from the sale of their current house and 28% are expecting to receive an
inheritance.
    However, insufficient savings could mean some retirees will have to scale
back their retirement expectations. Some Canadians are already aware of their
situation, with 36% thinking that their expected income in retirement will not
be enough to maintain their pre-retirement lifestyle.
    "None of us has absolute certainty about what the future might hold.
However, you don't have to be an expert on the future to save for it," added
Drake. "Canadians are not planning to slow down in retirement and nor should
their income."
    A great first step for Canadians is to assess their own projected income
in retirement. They can do that by talking to their financial advisor and by
using Fidelity's new Retirement Readiness SnapShot(TM) calculator at
www.fidelity.ca/takethechallenge.

    A view on Canada and the world

    Along with showing how Canadians are doing on a national scale, the Index
also measures the retirement preparations of working households across Canada.
The results revealed some interesting variations: Quebec's Index score was
highest at 53% and Alberta's was the lowest in the country at 45%. The other
regions include Atlantic Canada (52%), Ontario (50%), Manitoba and
Saskatchewan (52%) and British Columbia (47%).
    The overall 50% Index score for Canadians shows they are lagging behind
individuals in other countries in their preparation for retirement. Similar
studies conducted by Fidelity show that individuals in the United States (58%)
and Germany (56%) are better prepared than Canadians. Index scores for the
United Kingdom and Japan were 50% and 47% respectively.

    About the Fidelity Retirement Index

    In Canada, Fidelity Retirement Index is based on a survey of more than
2,200 Canadians working full-time; 25 years or older; reporting household
income of $20,000 a year or more; married/partnered with individuals who are
also not yet retired; and are the financial decision makers in their
household. The survey was conducted for Fidelity by Richard Day Research, Inc.
in February 2007. Index calculations are driven by Fidelity's asset-liability
modeling engine, which generates the percentage of potential pre-retirement
net income that each individual household surveyed is likely to replace upon
retirement. The Index represents the median of the individual household
percentages produced. The data were weighted to reflect the national and
regional distribution of Canadian households with employed workers based on
Statistics Canada data.
    For full methodology and survey data see www.fidelity.ca

    About Fidelity Investments Canada

    Fidelity Investments Canada ULC is the country's eighth largest mutual
fund company and part of the Fidelity Investments organization of Boston, one
of the world's largest providers of financial services. In Canada, Fidelity
manages a total of $42 billion in mutual fund and corporate pension plan
assets. It offers Canadian investors a full range of domestic, international
and income-oriented mutual funds. Fidelity funds are available through a
number of advice-based distribution channels including financial planners,
investment dealers, banks, and insurance companies. Fidelity Investments also
administers defined contribution plans and manages defined benefit assets on
behalf of corporate clients across Canada.

    VIDEO B-ROLL VIA ON-DEMAND AND SATELLITE AVAILABLE

    The following B-Roll on the Fidelity Retirement Index is available at the
listed times and coordinates:

    
    Interviews with:
      -  Canadians about their plans for retirement - 'on the street'
         interviews
      -  Peter Drake, Vice President, Economic and Retirement Research
         Fidelity Investments Canada ULC
      -  Peter Drake's comments include provincial breakdowns

    Broadcast Quality MPEG2 file download URL:
    http://cnw.pondeserver.com/story_details.asp?fn=147

    Live Satellite Coordinates:

    DATE OF FEED:   Tuesday October 23rd, 2007
    TIME OF FEED:   2:00 PM EDT - 2:30 PM EDT
    CO ORDINATES:   Anik F2 C, Transponder 7B
                    Audio subcarrier 6.2 and 6.8
                    Downlink frequency 3980 vertical
    TOC             CFA TX 1
    

    For technical information DURING the satellite feed, please call CNW at
(416) 863-5615





For further information:

For further information: Chris Pepper, Director, Media Relations,
Office: (416) 307-5388, Mobile: (416) 795-7762, Email: chris.pepper@fmr.com

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