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Paul de Sousa Shares Retirement Planning Recommendations with Wealth Professional

Retirees have been following the same asset-allocation strategy for decades: an equity-heavy portfolio that shifts more towards bonds for fixed-income during retirement. However, in the current market environment, it may be time to give the traditional retirement planning playbook a second look. Wealth Professional recently turned to Sightline Wealth Management Senior Vice President and Investment Advisor Paul de Sousa for insight on the dangers of the traditional fixed-income fixation and what investors planning for retirement should focus on instead.

“I think fixating on income, especially when interest rates are at generational lows, is quite dangerous,” de Sousa tells the publication. “Make no mistake, these low rates represent a large tax on investors, and it’s a war against savers.”

Instead, de Sousa recommends moving away from income investing and towards various other asset classes, including equities with a low down-market capture ratio. “With an alternative investment that has consistent distributions and/or capital gains and low down-market capture ratios, an advisor also has the option to withdraw part of the capital gains quarterly or semi-annually to produce cash flow,” he explains.

According to de Sousa, other asset classes investors approaching retirement should consider incorporating into their portfolios include mortgages, dividend-paying stocks and private debt. However, regardless of the specific type of asset, he encourages advisors and investors to utilize diligence, oversight and monitoring before investing.

“As a whole, it’s a wonderful asset class, but not all investments are made equal,” says de Sousa. “I advise everyone to not just stop once they see the label of private debt, but really roll up their sleeves and look under the hood. For the managers we use, there has been extensive due diligence – learning about their process, their operations, and the typical loan of their loan book – and double-checking what we’ve been told before placing any money with them.”

Read the entire article here.

 

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Sightline Wealth Management LP (“Sightline”) is an investment dealer and is a member of the Investment Industry Regulatory Organization of Canada (IIROC) and the Canadian Investor Protection Fund (CIPF). Sightline provides management and investment advisory services to high-net-worth individuals and institutional investors primarily through fee-based accounts.  

Sightline Wealth Management LP is a wholly owned subsidiary of Ninepoint Financial Group Inc.

(“NFG Inc.”). NFG Inc. is also the parent company of Ninepoint Partners LP, it is an investment fund manager and advisor and exempt market dealer. By virtue of the same parent company, Sightline is affiliated with Ninepoint Partners LP. Information and/or materials contained herein is for information purposes only and does not constitute an offer to sell or solicitation to purchase securities of any issuer or any portfolio managed by Sightline Wealth Management or Ninepoint Partners, including Ninepoint managed funds. 

Sightline Wealth Management (“Sightline”) makes every effort to ensure that the information has been derived from sources believed to be reliable and accurate. However, Sightline assumes no responsibility for any losses or damages, whether direct or indirect, which arise out of the use of this information. Sightline is not under any obligation to update or keep current the information contained herein. The information should not be regarded by recipients as a substitute for the exercise of their own judgment. Past performance is not indicative of future performance. Please speak to your Advisor regarding the suitability of information provided in this article for you. The opinions, estimates, projections and/or recommendations contained in this document are those of the author as of the date hereof.

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