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After 35 years of running a thriving advisory business in Winnipeg, Daryl Diamond was ready for the second act.

He transitioned his practice to a successor over a three-year period and gave up his licences, but isn’t giving up work entirely.

His new role will see him serve as chief retirement income strategist for Dynamic Funds’ Retirement Income Centre, which was the main area of focus for his former practice.

Mr. Diamond recently spoke with Globe Advisor about the next chapter.

How do you currently define your second act?

I consider myself retired from individual client work. I’m employed on a flexible basis.

Experience is a wonderful teacher. As I was beginning to transition out of running a practice, I realized I was going to be totally detached from the work I was doing and I didn’t know if I was ready for that. But a three-year gradual wind-down of the daily duties gave me an opportunity to assess. In my new role, I’ll be providing content to Dynamic Funds’ new Retirement Income Centre website.

What do some advisors still fail to understand about retirement income planning?

I’m always surprised at the perception that a retirement income practice is one that’s going to deplete. But the assets, from our experience, are relatively stable in terms of their value because they’re earning a rate of return.

The rate of withdrawal is often not going to be larger than the anticipated return given the portfolio metrics that are in play. Yes, there are minimum withdrawal formulas that come into play down the road for registered assets. But that doesn’t mean clients are spending it. They may relocate the assets to a tax-free savings account, for instance.

When I used to look at a prospective client scenario, it wasn’t that their investments were set up wrong. Retirement income planning is about helping clients make the best use of the assets they’ve accumulated. There are so many different ways to deliver their [needed retirement] income.

Now that you’re in the second act, does anything about retirement income planning change for you?

As you get to a certain age, you have a much greater appreciation of the mindset and some of the concerns of someone in retirement.

They often relate to making the best use of the quality time available to them in their retirement. No one knows how long they will stay healthy. We begin to experience more discretion and freedom with our time.

This interview has been edited and condensed.

- Deanne Gage, Globe Advisor reporter

Must-reads from Globe Advisor this week

Portfolio managers turn to LRCNs for attractive yields despite greater volatility

Limited recourse capital notes (LRCNs), a hybrid between bonds and preferred shares, are becoming a bigger part of Canada’s fixed-income market, offering higher yields than traditional bonds – and more volatility. Still, more money managers are scooping up the relatively new asset as a way to drive returns in client portfolios. “We really like the risk-reward profile in this space,” says Adrienne Young, senior vice president and director of corporate credit research at Franklin Templeton Investments in Calgary. Brenda Bouw explains the positioning of LRCNs in the marketplace.

Will annuities remain attractive as interest rates plateau or start falling?

An environment of rising interest rates and volatile investment markets has prompted more advisors and clients to consider incorporating annuities into their retirement income stream. But will demand hold if interest rates plateau or start falling? Daniel Walsh, senior vice president and head of individual insurance and annuities at BMO Insurance in Montreal, points out that while short-term interest rate fluctuations affect mortgages, lines of credit and guaranteed investment certificates (GICs), it’s long-term interest rates that matter for annuities. And as long-term rates have moved upward, BMO Insurance has seen interest in annuities rise to levels not seen since before the pandemic. Alison MacAlpine reports.

Why this $18-billion investment firm is adding more defensive stocks and trimming growth names

Investors should temper their return expectations in this era of higher inflation, but there’s still good money to be made in select stocks and industries, says Murray Leith, director of investment research at Odlum Brown Ltd. “I think it will be a lot tougher to see double-digit equity returns in this market environment. High single-digit returns are the new reality,” says Mr. Leith, also executive vice president at the Vancouver-based investment dealer, which oversees about $18-billion in client assets. Brenda Bouw finds out what he’s been buying and selling.

Why Canada is a haven for the world’s wealthy

Canada is attracting more high-net-worth newcomers than previously forecasted as wealthy immigrants seek an open and stable place to grow and diversify their businesses and investments, a new report shows. The influx of new Canadians, which hit record levels in 2022, should also bring a welcome injection of capital to the country amid ongoing economic uncertainty. Wealth management industry experts say it’s also an opportunity for advisors to expand their client base. Canada welcomed 1,200 high-net-worth individuals (HNWIs) in 2022 – a 20-per-cent jump from projections last year – according to the Henley Private Wealth Migration Report 2023 released on June 13. HNWIs are those with investible wealth of more than US$1-million. Brenda Bouw explains more of the report’s findings.

Also see:

How fund managers are playing the AI-fuelled tech rally

Canadian banks’ recent earnings hit offers attractive entry point for long-term investors

U.S. junk loan defaults surge as higher interest rates start to bite

Fund managers cut commodity allocations as China demand doubts grow

Will the Fed surprise markets with interest rate decision in this week’s Advisor Lookahead

What you and your clients need to know

CRA knew clawbacks would cause low-income taxpayers hardship, memo shows

The Canada Revenue Agency was aware that a planned ramp-up this past winter in its debt collection activities could result in confusion and financial hardship for some low-income individuals at a time of high inflation, according to a memorandum sent to the minister of revenue. The briefing, which was prepared for Minister Diane Lebouthillier and signed by CRA Commissioner Bob Hamilton, noted the agency would deploy “empathetic messaging” in its communication about the resumption of benefit and tax refund offsets. But the same document shows the agency planned to use its routine practices when collecting the debt, which includes full clawbacks being applied to individuals and families living below a strict measure of low income in some cases. Erica Alini provides more details of this CRA memo.

Moving season can lead to confusion around moving expense deductions

Section 62 of our tax law provides a deduction for eligible moving expenses. The rules say that the reason for your move matters (escaping an underwear-stealing cat won’t qualify). The reason for your move must be to enable you to carry on business or be employed at a new work location or to attend postsecondary school full-time. Also, your new residence has to be 40 kilometres closer to your new work or school location than your old residence. Tim Cestnick explains how the moving deduction works for tax purposes.

Oh, great. Unaffordable Toronto and Vancouver are ranked as top cities for young people to live and work in

Two of the Top Three cities in Canada for young people to live and work in are so expensive that the average house price is $1.2-million and the average one-bedroom apartment rent is more than $2,500 monthly. Toronto was first and Vancouver third in the latest Youthful Cities Urban Work Index, a ranking of 30 cities by the quality of life and employment they offer young people aged 15 to 29. It’s often said that Gen Zs and millennials should leave Toronto and Vancouver for the sake of affordability. But these two cities are places to make your fortune as much as break it. Why should young people have to move away? Rob Carrick offers some analysis.

CERB helped a significant number of workers rejoin the job market in better positions

The Canada Emergency Response Benefit helped a significant number of Canadians get better jobs, mainly because it gave them the financial means to improve their skills through training programs, a new study has found. The study, conducted jointly by two think tanks, the Canadian Centre for Policy Alternatives and the Future Skills Centre, suggests the CERB program aided workers during the pandemic not only by tiding them over until they could find new jobs but also by helping them move into new fields with greater job security and higher income potential. Vanmala Subramaniam reports on the findings.

– Globe Advisor Staff

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