Despite concerns about making their money last, many of today's income
investors are sticking to low-yielding investments
TORONTO, Feb. 5, 2013 /CNW/ - A new CIBC (CM: TSX; NYSE) poll reveals
that today's lower interest rates are taking a toll on investors who
named income generation as their primary investment objective, with 42 per cent saying they are not satisfied with the returns they are currently
generating in their portfolios. In fact, only 10 per cent are completely satisfied with their returns.
Key poll findings include:
Among those who stated that income generation was their primary
investing goal, 42 per cent of this group say they are not satisfied with the income they are
currently generating from their portfolio; in fact, only 10 per cent said they were completely satisfied.
Despite the concern, there is strong resistance to change with 54 per cent of income investors in low-yielding products saying they are not
considering moving funds, with 52 per cent of that group citing "too risky" as the reason.
Fear Prevents Investors from Changing their Approach
"The fact of the matter is that fear is driving the decisions of many
investors," said Steve Geist, President, CIBC Asset Management. "As a
result, they have stopped taking an objective look at their investment
options and are simply parking their money in low-yielding products -
but ones that often guarantee a return that's less than inflation. In
this new economic reality, Canadians need to review their portfolios
for investments that will generate the income or return needed to meet
"When you combine this extended period of rock-bottom interest rates
with the fact that people are living longer after they retire, you
reach a point where you need to consider a new investment path," said
Mr. Geist. "The good news is that there are investment strategies and
solutions that can help, and by working with an advisor you can find
that right balance."
Advice on Generating Income from your Retirement Portfolio
For investors who need to generate more income from their retirement
portfolio, while still managing risk, CIBC offered the following tips:
Meet with an Advisor to review your finances - An advisor can help you determine how much income you will need to
generate from your retirement savings and whether adjustments to your
current portfolio would make sense based on your financial goals.
Diversify your fixed income investments - Just like investing in equities, the benefit of diversification holds
true for fixed income as well. A managed approach that spreads
investments across a number of different types of fixed income assets
such as corporate and global bonds can yield better results.
Move gradually up the risk spectrum - You can generate additional yield for your portfolio by moving into
high-yield corporate bonds, Real Estate Investment Trusts or dividend
Use specialized expertise - The investment universe is more complex than ever, but there are
excellent opportunities which experts can help identify. Professional
money managers can evaluate risk and identify the most favourable
Results are based on a CIBC poll conducted by Leger Marketing via a Web
survey conducted from December 21, 2012 to January 4, 2013 among a
representative sample of 1541 English- and French-speaking Canadians
with an investment portfolio for retirement. Using data from Statistics
Canada, the results were weighted according to gender, age, region,
language spoken at home, education and presence of children in the
household to ensure a sample representative of the entire population
under review. In comparison, a probability sample of the same size
would yield a margin of error of ±2.50%, 19 times out of 20.
CIBC is a leading North American financial institution with nearly 11
million personal banking and business clients. CIBC offers a full range
of products and services through its comprehensive electronic banking
network, branches and offices across Canada, and has offices in the
United States and around the world. You can find other news releases
and information about CIBC in our Press Centre on our corporate website
CIBC Asset Management, the asset management division of CIBC, is
responsible for the CIBC and Renaissance Investments families of mutual
funds, Imperial Pools, Frontiers Pools and the CIBC family of managed
portfolio solutions - Axiom Portfolios, CIBC Managed Portfolio Services
and CIBC Personal Portfolio Services. CIBC Asset Management manages
more than $55 billion in assets.
For further information:
Sean Hamilton, Director, Media Relations: (416) 304-8456 or firstname.lastname@example.org