Investing November 3, 2003

ICI: ETFs Add $2.45 Billion in New Assets in September

November 3, 2003 (PLANSPONSOR.com) - Assets in exchange-traded funds (ETF) rose in September to $119.75 billion from $117.28 billion the previous month.
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Increases were noted in the broad-based ETFs, which went up to $91.03 billion in September from $89.27 billion in August (See  ETF Assets Increase to $117.38 in August ).  Further, even though sector/industry ETFs were down slightly to $15.15 billion from $15.18 billion, the total domestic equity index managed to gain ground in September, up to a total asset amount of $106.18 billion from $104.45 the month before, according to data supplied by the Investment Company Institute (ICI).

Results among the other indices were mixed.   The Global/International Equity Index saw a net inflow of assets, ending September at $9.37 billion from $8.51 billion in August.  Conversely, the Bond ETF index recorded a net asset outflow, closing September at $4.21 billion from $4.32 billion in the previous month.

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Additionally, the value of ETF shares issued in September exceeded that of shares redeemed by $4.02 billion.  The total number of ETFs was up by one to 115. 

Shares of exchange traded fund trade intraday on stock exchanges at market determined prices. Investors may buy or sell ETF shares through a broker just as they would the shares of any publicly traded company (See  Exchange-Traded Funds ).

Administration November 2, 2003

Sunset Years Anticipated North of the Border

February 11, 2003 (PLANSPONSOR.com) - Canadians see retirement as the end of their working life, regardless of the lack of confidence in their own ability to save for retirement and their perception of possibly not receiving a government pension.
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Even though an overwhelming 46% of the population feel that they will not be able to set aside enough money for this phase of life, 68% of Canadians said they would not consider returning to work once they retire even if they received an ideal offer to work full time in their dream job, according to a survey conducted by SOM Surveys, Opinions and Marketing on behalf of Desjardins Financial Security.

However, a majority (60%) of Canadians over age 40 realize that retirement will not happen overnight and expressed interest in gradual retirement once they leave the workforce. And, although 48% of Canadians are aware of the impending labor shortage, they are more likely to look for opportunities to work on their own terms, whether that be part-time consulting or turning a hobby into a business.

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On average, these workers said they wish to retire at the age of 60.   More than 40% of Baby Boomers (40 years to 54 years) wish to fully retire before the age of 55.   The main challenge for those going into retirement will certainly be related to a change in personal income (75%). However, having to adapt to a change in daily activities will also dominate (68%).

Outside Support

Concerning the Canadian Pension Plan (CPP) and the Quebec Pension Plan (QPP), there is considerably more skepticism about governments’ abilities to pay out pension-plan benefits. A staggering 76% of Canadians feel the federal government is unlikely to meet its obligation.   Quebecers have a similar lack of confidence (71%) toward the provincial government’s ability to pay out the benefits from the QPP.   Only 6% of Canadians have faith in the CCP and the figure for the QPP is 5%.

Support from the employer to help people plan their retirement is a possibility for more than 40% of workers 40 years or older. This support consists mainly of seminars, information brochures, or the possibility of meeting with a financial planner.  Employer support to plan for retirement is more common in Atlantic Canada (61%) than in British Columbia (20%).

Financial planners are more involved than they were before among those who resorted to someone else to do their planning. Ninety percent of non-retired Canadians used the services of a financial professional as compared to 70% among retirees.

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