‘Longer lives
require cash
and planning

’ By Janet Ketchan

; Contributing Writer

- CANADIANS have a’
problem. Give thanks to

the healthy food, excel- .

“fent medical care, or our

hess stressful lives, but

we're living, longer. In
"7900, the average

-. Canadian life expectancy —

was 49. In 1995, it was
679%

: The. problem? Many
. Canadians ‘are’ not financially
. prepared for ‘such longevity,
ey when the capability of
“all Jevels of government to help
us: in! our retirement. is so
severely diminished. -;
And: there’s another ele-
ent to”. “consider. For many,

ney.
‘etordng, we all have. to

fresh thinking on our 7

retirement plans, whether we're
retired right now, or even if it’s
still 20 years away.

It behooves all Canadians,
whether retired or planning for
their retirement, to consider
these immutable facts of
national life. First the era of
benign and generous govern-
ment has gone. Twenty years of
feckless borrowing has created
a mammoth debr, now equiva-
lent to almost 100% of
Canada’s GDP.

The unfunded liabiliry for
the CPP/QPP is now well over
$700 million.. Optimists say
that public pensions are a pay-
as-you-go system, and as more

Canadians retire, wage deduc-

tions will simply be raised as
necessary.

In my view, that’s wishful
thinking. If you take too much
out of the economy, it will lose

’ the ability to generate wealth.

Then add in the future cost
of health care for seniors atid
the amount of these future
obligations is staggering.

The bottom line is that as
cach year passes, we'll be forced
to take more and more respon-
sibility for our senior years. And

the ‘type ‘of investing required

to meet’ the demands of. this

ae What You Make...
It's What You Keep!”

Registered Financial Planner

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fie

financial responsibility is under-

going some important changes.

It used to be the cautious
Canadians that concentrated
on the mainstays of conserva-
tive investing —- bonds,
stripped coupons, GICs and
preferred shares.

But these days, fixed income
markets demonstrate great
volatility, due to Canada’s enor-
mous debr loads and the whims
of international investors.

One of the key capital mar-
ket developments in recent
years has been the decline in
both inflation and interest
rates. The most recent data
shows that inflation is currently
running at less than 2% annual-
ly.

Interest rates have fallen as

-well. Ten year bond yields are

now about 7.5%. Further
declines are forecast in the years
ahead as interest rates get set:
tled into a more appropriate
relationship to the low inflation
environment. As a result, the
role of fixed income in building
retirement assets is expected to
diminish.

The prudent long-term

investor wili hold a mixed port--

folio of investments, with a
heavier weighting in equities. A
balanced portfolio would fea-
ture 40% in fixed income (or
related) securities, 55% in blue
chip equities, and a modest 5%
in cash.

Janet Ketchen is branch
manager and an investment
adviser in the West Vancouver

office of Richardson Greenshiclds

of Canada, Ltd.

IMAGINE ... Having to make
important decisions on the most

difficult day of your life.

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fii ions Gate Hospital plays a major part in our lives. It touches us, our families and our neighbours in some way almost every day. It is ours, and it deserves our’

support.

‘Many times through thoughtful estate planning there exists an opportunity to
in a significant and lasting way. Gifts to Lions Gate Hospital Foundation through bequests,

"your family may make a larger contribution in the fucure than might be possible today.

“A gift through your estate will help to ensure that all of the resources néeded to keep pace with the changing world of health care are available for No

- well into the future.

look after family and at the same time contribute to the betterment of the’ community ;
annuities, property and life insurance are some of ‘che ways that you and“. :

wth Shore families

If you would like to review your plans or would like more information on making a gift please call Sheilah Grant, Director of Development at 984-5785 to arrange an a

appointment.

Lions Gate Hospital Foundation

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North Vancouver, B.C.

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