Toronto-based Russell Investments Canada Ltd. (Russell Canada) has launched a new product designed to help Canadian pre-retirees and retirees address their most basic personal financial questions: do I have sufficient funds to finance my desired lifestyle in retirement and, if not, how can I take proactive steps to get there?
The Russell Retirement Lifestyle Solution, available only through financial advisors, features an online tool designed for advisors to use in the retirement planning process. The tool draws on a key concept of defined benefit pension plans — the funded ratio — to help determine whether investors 50 years of age and older will have enough money to meet their retirement income needs. And, depending on the determination, the tool recommends a suitable course of action.
The funded ratio is a financial health measure that evaluates an individual investor’s “retirement readiness” by comparing assets to liabilities to determine a personal funded status. A funded ratio above 100% means the investor is generally on track to meet their retirement spending goals, while a funded ratio below 100% means the investor may need to contribute more money, adjust their asset allocation or make changes to their retirement plan.
The ultimate goal is to address the specific problem of providing consistent retirement income by determining a suitable investment allocation between growth, income and capital preservation in order to reduce the likelihood that the investor will run out of money.
In developing the tool for Canadian financial advisors and investors, Russell Canada drew from proprietary research focused on advisors and clients and leveraged its more than 40 years experience applying strategic market insights, global money manager research and rigorous investment processes to create and implement multi-asset portfolios for large institutional investors.
“We believe advisors will find the Russell Retirement Lifestyle Solution to be a unique and valuable program to help navigate the retirement process, deliver a customized solution and provide ongoing support to clients. It is about getting investors through, not just to, retirement,” said David Feather, president and chief executive officer for Russell Canada, in a release.