The need for a financial plan also of greater concern
Concerns about reducing debt in retirement continue to rise
TORONTO, Jan. 30, 2012 /CNW/ - As financial markets continue to
challenge investor portfolios, having a reliable source of income in
retirement remains a concern for Canadians according to the results of
the most recent Russell Financial Health Index (RFHI). In the fourth
quarter of 2011, this concern was at the second highest level since the
benchmark was established in early 2008, and concerns about having a
tangible and realistic financial plan and reducing debt in retirement
Overall, for the fourth quarter of 2011, the Russell Financial Health
Index — an online calculator that gauges the financial health of
Canadian investors— was relatively flat at 47.08, down slightly from
the previous quarter when it was 47.47, and at the second lowest level
since the benchmark was established.
"Considering that the market volatility we experienced in 2011 is
expected to stay with us in 2012, it's only natural that Canadian
investors continue to be concerned about generating a consistent level
of income in their retirement years," said Bob Leeming, Director of
Client Solutions, Russell Investments Canada. "Not surprisingly then,
the RFHI results also show that Canadians are seeing the increasing
importance of having a tangible and realistic financial plan."
Carrying debt into retirement is another area of growing financial
concern for Canadians this quarter, increasing steadily over the last
year. Numbers released by Statistics Canada last month put household
debt levels at 150.8 percent of income.
"We can't control the economy, but we can do something about improving
our financial health, and helping to ensure a better financial future,"
explained Leeming. "Carrying debt into retirement can create cash flow
problems, especially if it is variable rate debt, and while this low
interest rate environment makes debt more affordable, interest rates
can't remain at current levels forever."
Leeming also noted that, "While it can be tempting for people to delay
their long-term investment plan, reduce their exposure to potentially
risky growth assets or perhaps even flee the market altogether, sound
strategies such as reducing debt, combined with implementing a solid
financial plan can help Canadians take some of the emotion out of the
turmoil created by the financial markets."
About the Russell Financial Health Index
The Russell Financial Health Index gathers its data from a confidential
web survey, which takes approximately five minutes to complete. Based
on a user's answers, a Financial Health Score is assigned, which can be
measured against the scores of other Canadian investors who have used
Each score is a result of analyzing variables that include physical
health, personal finances, unexpected events and financial planning.
Respondents are also asked questions related to how prepared they feel
to ride out changes in their long term investment performance before
and during retirement.
Findings from the Index will be used to assess and report findings, on a
quarterly basis, about how Canadians perceive their financial health,
as they deal with different economic environments and changes in their
About Russell Investments
Founded in 1936, Russell Investments is a global financial services firm
that serves institutional investors, financial advisers and individuals
in more than 40 countries. The firm has C$143.4 billion in assets under
management (as of 09/30/11) in its mutual funds, retirement products,
and institutional funds.
Russell Canada was recently named the #1 fastest growing money manager
in Benefits Canada's 2010 Top 40 Money Managers Report. For more information about how Russell helps to improve financial
security for people, visit us at www.russell.com/ca.
Commissions, trailing commissions, management fees and expenses all may
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Nothing in this publication is intended to constitute legal, tax
securities or investment advice, nor an opinion regarding the
appropriateness of any investment, nor a solicitation of any type. This
is a publication of Russell Investments Canada Limited and has been
prepared solely for information purposes. It is made available on an
"as is" basis. Russell Investments Canada Limited does not make any
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trademarks of Frank Russell Company, used under license by Russell
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Copyright © Russell Investments 2012. All rights reserved. This material
is proprietary and may not be reproduced, transferred, or distributed
in any form without prior written permission from Russell Investments.
Date of first publication: January 30, 2012
SOURCE Russell Investments Canada Limited
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