Canadians are increasingly worried about the impact the economic aftermath of the pandemic will have on their financial wellbeing, according to a new report from IG Private Wealth Management.
The report, Family Matters: A report on affluent Canadians and the transfer of wealth, found that eight in 10 (82%) high-net-worth (HNW) Canadians surveyed (those who have at least $1 million in investable assets) are worried about the current state of the Canadian economy and the impact it is having on wealth and retirement planning.
Inflation is top of mind for the majority of HNW Canadians (84%), followed by individual factors such as energy costs (72%) and rising interest rates (49%). Other concerns include maintaining and growing wealth (61%) and managing wealth (49%) in the current economy.
“Much like other groups, high-net-worth Canadians are concerned about where the economy is going and its impact on their personal situation,” said Damon Murchison, president and CEO of IG Wealth Management.
While 74% of respondents have a financial advisor, only 45% have a financial plan that encompasses all aspects of their financial life, the report said. Those who have an advisor say their advisor helps them manage their wealth (60%), grow their wealth (59%) and mitigate adverse affects of the economy (56%).
The study also found that while almost all HNW Canadians said they either have a retirement plan (47%) or at least some idea of what retirement will look like (45%), the economic aftermath of the pandemic has had a lasting effect on their retirement planning.
The majority of respondents (85%) said they are confident they will have enough money to support their lifestyle in retirement, but almost half (48%) reported re-evaluating how much they will need to retire comfortably.
Further, respondents reported changes to when they will retire (46%) and how they will manage their investments in retirement (46%). Of those considering delaying retirement, more than half (52%) said it is because their investments are earning less and living costs are rising.
“We live in very complicated times — the value and importance of professional advice and financial planning has never been more important,” Murchinson said.
The report was conducted by Pollara Strategic Insights between Oct. 7 and 14, surveying an online sample of 500 Canadians with investable assets of $1 million or more. Online surveys can’t be assigned a margin of error because they don’t randomly sample the population.