Global Investor Study
Canadians focus on personal wealth
Schroders Global Investor Study 2016 found that Canadians are more focused on growing their personal incomes and have a more realistic view of the level of income they might be able to achieve than the average consumer in the US.
Schroders Global Investor Study found that the top reasons Canadians invest are to:
- Supplement long-term savings (pension/annuity / superannuation income)
- Re-invest with the goal of growing their portfolios
However, Canadians are significantly less focused on:
- Paying for their children’s (or grandchildren’s) education fees
- Buying something other than a home
- Supporting a career change
- Providing income for children (or grandchildren).
Meanwhile, 12% of Canadian investors invest to buy something other than their homes compared to 24% of American investors and 20% of global investors.
Unlike millennials, which the study found want to spread the income from their investments across a broad range of dependencies, Canadian consumers have more of a focus on personal wealth.
By focusing the outcome of their investments on just two main areas, Canadians are giving themselves potentially a greater chance of achieving their investment goals, rather than spreading themselves too thinly.
Schroders Global Investor Study also found that Canadians desire a conservative amount of income on their investments, compared with the global average:
- 60% would like less than 10%
- 30% would like 10-14%
- 10% would like 15-20% income on their investments
Overall, the average level of desired income in Canada was 8.4% compared to 10.4% in the Americas and 9.1% globally.
It is a sign of how out-of-touch consumers are globally that Canadian consumers’ income demand of 8.4% is considered conservative, comparative to the global average.
But Canadian’s still demand far more income than most stockmarkets currently offer in yield, and well above most developed market interest rates.
So, while Canadians have a narrow focus on personal income growth, their demand for high levels of income might need to be reviewed to avoid long-term income disappointment.
The views and opinions contained herein are those of Schroders’ investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.’s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.