IG Private Wealth Management Study: Affluent Canadians Prioritize Education and Real Estate for their Children, and Philanthropic Giving

New research report on high-net-worth Canadians reveals the priorities, concerns and blind spots related to the transfer of wealth

TORONTO, Nov. 23, 2021 /CNW/ - According to a new report on high-net-worth (HNW) households by IG Private Wealth Management (a division of IG Wealth Management), the pandemic has caused many to pause and reflect on their plans for the transfer of their wealth, both during their lifetimes and as part of their estates.D

The report, Family Matters: a report on affluent Canadians and the transfer of wealth, draws on research from Investor Economics and Pollara Strategic Insights.  It reveals that HNW Canadians, defined as those who have at least $1M in investable assets, have been reconsidering their finances in ways that prioritize not only their children but the world around them.

The "Bank of Mom and Dad" is open and operating for many affluent families, providing significant funding for their children's post-secondary education, the purchase of a first home and/or capital to start a business.  Key findings include:

• More than three-quarters (77 per cent) say they wanted to see their children "get ahead".
• A large majority (86 per cent) of those surveyed said they planned to provide financial support for children attending college or university, with the average amount totalling more than $35,000.
• HNW individuals are also committed to ensuring their children can break into the rising housing market; they are giving an average of $145,000 to each child for the purchase of a home.
• As more young people look to start new business ventures, more than a quarter (26 per cent) of HNW Canadians said they would fund half or more of the start-up costs if their son or daughter decided to open a business.
• While the financial generosity covers a wide range of areas, some respondents expressed concern that giving to their children might go too far or that they wished not to over-burden the younger generations with wealth.

"Increasingly, Canadian families are viewing wealth created by older generations as family assets, and as means to help their children and grandchildren enjoy a more secure financial future," said Damon Murchison, President and CEO, IG Wealth Management. "However, many parents are also concerned about how and when to leave money to the next generation."

Mr. Murchison continued, "With wealth comes complexity. At IG we work with clients to turn complicated matters into clear solutions, whether it be through detailed estate planning that includes the entire family or seminars to help increase financial literacy among young Canadians.

Thinking of the World Around Them

The generosity of HNW Canadians also extends outside the family.  The study found the following as it relates to the philanthropic habits of affluent Canadians:

• Two-thirds of affluent households currently donate to charitable causes on a regular basis.
• One-in-five (20 per cent) reported that their estate plans include gifts to philanthropic organizations.

"The last two years upended the lives of so many and led Canadians to consider charitable giving, not just as a good thing to do, but as the right thing to do," noted Mr. Murchison.  "With more Canadians incorporating philanthropy into their financial lives, it's an increasingly important part of a holistic  estate plan, and a great way to bring families together to think of the larger world around them."

The full report can be found at https://www.ig.ca/content/dam/investorsgroup/pdf/ig-inter-generational-wealth-transfer-client-report-en.pdf

About IG Wealth Management
Founded in 1926, IG Wealth Management is a national leader in delivering personalized financial solutions to Canadians through a network of advisors located across Canada. In addition to an exclusive family of mutual funds and other investment vehicles, IG offers a wide range of other financial services. IG Wealth Management has $116.5 billion in assets under advisement as of October 31, 2021 and is a member of the IGM Financial Inc. (TSX: IGM) group of companies. IGM Financial is one of Canada's leading diversified wealth and asset management companies with approximately $271 billion in total assets under management and advisement as of October 31, 2021.

About the Pollara Study
This study was conducted with an online sample of n=510 Canadians who have investable assets of $1M or more.  This study was conducted between August 5^th and 12^th, 2021.  Results from a probability sample of this size could be considered accurate to within ±4.3% percentage points, 19 times out of 20. Results have been weighted on the basis of age, gender and region to be representative of this population in Canada as a whole.

SOURCE IG Wealth Management

Nini Krishnappa, IGM Financial, 647-828-2553, [email protected]