Education is key in protection of those reaching or in retirement
Concerns around the preparedness of Canadians who are approaching or already in retirement are in focus for securities and financial regulators in Ontario.
A survey conducted by the Ontario Securities Commission asked Canadians aged 50 or older about their financial situation and how ready they are for their retirement years. Meanwhile, the FSRA is taking steps to educate and protect this cohort.
The OSC’s research found that most retired Canadians who took part said they are in a financially strong position and are investing and earning an income, but 15% said they are in a poor situation, and almost one third said their expenses are higher than they thought they would be.
Retirees and those approaching the milestone also expressed concern about being able to cope with a financial emergency and declining physical or cognitive decline is not something that many respondents are prepared for.
This is worrying given that around half of pre-retirees had experienced an event that impacted their ability to save for retirement, and a similar share of retirees had experienced an event that impacted their finances (long-term disability was the most common).
"Identifying and addressing the needs of older investors is a priority for the OSC," said Tyler Fleming, Director of the Investor Office at the OSC. "The retirement survey provides important insights into the expectations and experiences of retirees and pre-retirees. The research results will help inform the OSC's regulatory and operational work in support of seniors."
The FSRA is releasing guidelines explaining the difference between decumulation products and pension or insurance products and suggesting important questions that consumers should be asking when considering buying these products.
“Consumers considering investing in these types of decumulation products should talk to their financial planner, life insurance agent or securities advisor to understand what they are buying, whether it is right for them and what guarantees apply,” the regulator says.
It notes that some decumulation products may use terms associated with pension plans or insurance – such as annuity, guaranteed income, lifetime income, or tontine – but they do not offer the same protection as registered products and are not regulated by the FSRA.
OSC seniors panel
The OSC has announced the members of its Seniors Expert Advisory Committee (SEAC) for the 2024 term which includes several from the financial services industry:
- Angela Salmon – securities lawyer and financial services professional at RBC
- Arthur Fish - former partner in the tax group of Borden Ladner Gervais LLP and manager of the Toronto Regional Family Wealth Counsel Practice
- Danielle Tetrault – VP of Compliance and chief compliance officer at IG Wealth Management
- Ellen Bessner - partner with Babin Bessner Spry LLP
- Jennifer Aronson - registered social worker and clinical practitioner
- Jennifer Moir - founder of Age Well Solutions
- Dr. Joe Bornstein – managing director and founder of Health Innovations Group
- Dr. Julia Spaniol - professor in the Psychology Department of Toronto Metropolitan University
- Ken Kivenko - president of investment advocacy association Kenmar Associates
- Kimberly Whaley - founding partner of Whaley Estate Litigation Partners
- Kyle Fitzgerald - director of Government Relations and Public Policy with the Alzheimer Society of Ontario
- Laura Tamblyn Watts - CEO of CanAge
- Detective Constable Michael Payne - a police officer in Waterloo Region
- Terri Williams - a financial literacy specialist with more than 30 years of experience in financial services.
