Advisors have an opportunity to help older Canadians who are sitting on $300 billion in low-yielding investments, suggests Russell Investments Canada Ltd.

According to data provided by Ipsos Reid, Canadian investors aged 50 and older are currently holding about 25% in GICs and High Interest Savings Accounts (HISAs) in their portfolios — a nine-year high.

Russell research further concluded that these GIC and HISA holdings represent roughly $300 billion in low-yielding investments.

“Investors have had to deal with significant market volatility over the past two years, so it is expected that many Canadians have a lower risk tolerance and a higher desire for security,” says Fred Pinto, managing director of distribution services at Russell.

“However, too many Canadians are earning unnecessary low returns. GICs and savings accounts do not yield enough after-tax returns to position portfolios for retirement and deliver the income needed in retirement, particularly if you factor long-term inflation expectations,” says Pinto.

“As a result, this $300 billion sitting on the sidelines represents a tremendous opportunity for advisors to help clients put their money to work, make the most of their savings, and build their retirement portfolios.”

Pinto notes that globally-managed bond and conservative balanced funds posted double-digit gains last year.

Although these funds featuring slightly more investment risk, they are much more able to address longevity risk — the risk of outliving one’s money in retirement, he says.

IE