Briefly: “Canadians expect to work past 65” and more of Wednesday’s news

It is increasingly likely that your clients will continue to work past the traditional age of retirement, according to a study by Sun Life Financial. Nearly half of Canadians said they believed they would work past 65, partly due to financial losses suffered in 2008’s market downturn.

Fortunately, this is only part of the reason behind the expectation; working later into life is also seen as a means of staying mentally and socially active.

“Despite many Canadians expecting to work after age 65, those surveyed are approaching this reality with resolve,” said Dean Connor, president, Sun Life Financial Canada. “Interestingly, in pinpointing their primary reason for working past age 65, as many people singled out lifestyle reasons as those who indicated financial reasons.”

In recent years, the average retirement age has actually been creeping lower, to 61 years.

“Only 28% of people are very confident they will have enough money to enjoy their desired lifestyle in retirement,” said Connor. “Not surprisingly, Canadians who use a financial advisor to help them plan for retirement feel much more confident when it comes to their future.”

The survey found that 62% of Canadians lack a written financial retirement plan and only 47% have consulted a financial advisor to create or update such a plan within the last 12 months.

Using an advisor certainly seemed to improve Canadians’ peace of mind. Of those who had an advisor, 83% said they are more confident about their finances, and 86% expect to have a better retirement because of the advice.

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Claymore offers new ETF options

Claymore Investments is moving further into the home turf of the mutual fund industry, offering new options on its line of exchange traded funds (ETFs).

Among the new services, investors can now opt for an automatic dividend reinvestment plan, starting in February 2009, allowing rolled-over distributions to compound returns.

“We are continually looking at ways to help improve the ETF structure and make it easier for investors of all sizes to invest more effectively and efficiently,” said Som Seif, president and CEO of Claymore Investments.

Claymore is also offering a pre-authorized cash contribution plan, allowing investors to make systematic purchases on a monthly, quarterly or annual basis. Investors may also opt for a systematic withdrawal plan, which is also available on a monthly, quarterly or annual basis.

“Given trading commissions, we generally find ETFs have not been best suited for small investors, dollar cost averaging strategies or income withdrawal plans,” Seif says. “With the launch of our Auto DRIP, PACC and SWP, unitholders can now compound their Claymore ETF distributions in additional units, make regular cash contributions or create an income stream from their ETF units, without having to worry about paying additional commissions on these trades.”

All three options will be available on the entire family Claymore ETFs listed on the Toronto Stock Exchange and on both Common Units and Advisor Class Units.

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More than 1,200 Canadians pass CFA Level I

The CFA Institute has released the pass rate for the Level I exam that was taken globally in December. Of the 49,797 candidates who took the test, just 35% passed. The number of candidates who sat the exam marked a 25% increase over the number that took the test in December 2007.

Canadian candidates matched that global average, with 35% of 3,555 candidates passing the exam. European candidates had the highest pass rate, at 38%.

“I am delighted at the number of candidates willing to invest in their own future and professional standards,” says John Rogers, CFA, CEO and president of CFA Institute. “There has never been a more important time for individuals and employers in the investment industry to enhance their professionalism and the numbers embarking on the CFA program help show commitment to this cause.”

There are currently 86,968 CFA charterholders globally.

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Call goes out for global accounting debate

The world’s leading accounting bodies are calling for a global debate on how to simplify financial reporting and hasten a move to principles-based financial reporting standards.

“It is clear from our research that a body of principles based on international standards is viewed around the world as the best basis on which to report the economic substance of financial transactions, and that further steps are needed to ensure that principles are embraced more fully,” said Kevin Dancey, chair of the Global Accounting Alliance (GAA).

Dancey, who also is president and CEO of the Canadian Institute of Chartered Accountants (CICA), points out that there are major legal, cultural and regulatory differences that will need to be addressed before reaching some kind of globally accepted accounting rules.

To that end, the GAA is arranging several roundtable events involving regulators and other stakeholders.

(01/28/09)