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Interprovincial migration, particularly out of Ontario, is on the rise – and that may create opportunities for advisors in locations where newcomers decide to reside.
More than 146,000 people changed provinces in the second quarter of this year, according to Statistics Canada. A report from Scotiabank Economics noted that almost 108,000 Ontarians moved to other provinces and territories last year, the largest out-migration in more than 40 years. The report states that migration is happening for a combination of reasons as people seek cheaper real estate and a reduced cost of living, a more desired lifestyle, and more remote work options.
Ontarians were more likely to relocate to Nova Scotia, New Brunswick, Prince Edward Island and British Columbia. Some of the advisors on The Globe and Mail and SHOOK Research’s Canada’s Top Wealth Advisors: Best in Province ranking have also witnessed the migration trend.
Michael Anderssen, senior portfolio manager and senior investment advisor at Anderssen Wealth Management with TD Wealth Private Investment Advice in Bridgewater, N.S., has some new, retired clients who moved to his scenic town from Ontario. They sold their Ontario houses, purchased a house outright in Bridgewater, and have a cash surplus, often in the mid-six digits.
“They wanted to make their retirement even better,” he says. “When they sell their property for north of $1-million in Toronto, it really makes their retirement more rock solid because this is cash that they would never have had otherwise.”
Before the pandemic, Chris James, wealth advisor with James Financial Advisory Group at CIBC Wood Gundy in Fredericton, never heard of Ontarians moving to the Maritimes in a significant way. If anything, it was a reverse move out West. He now has some clients who sold their houses in Ontario and settled in houses in northeastern New Brunswick on oceanfront lots.
“They have a bigger bank account and they’re quite happy,” he notes. “Their cash flow plan changes entirely. They can now max out their registered accounts. The question becomes what to do with the rest of the money?”
If they hadn’t moved to New Brunswick, that money would’ve just been part of their home equity, he adds.
What to consider beyond the basics
Mr. James advises those who are thinking of relocating to consider other variables besides the financial. He finds the ones who are most successful in making the move already have family and/or friends in their new province, have visited and appreciate the slower lifestyle pace. Others, like one of his clients, move East, don’t like it and move back. Only now in the client’s case, he’s priced out of the Toronto market as housing prices there soared, along with interest rates.
Darcie Crowe, senior wealth advisor and senior portfolio manager with Crowe Private Wealth at Canaccord Genuity Wealth Management in Vancouver, will revisit a client’s financial plan if they decide to relocate. Some believe that since they can work from anywhere, they can just pick a cheaper locale and all is good. But Ms. Crowe still advises they investigate income opportunities in the province where they’re moving.
“Being able to work remotely or continue to hold that job may not be the case forever,” she points out.
Some plan on early retirement after banking the proceeds from the sale of their house and in that case, Ms. Crowe would run calculations on how that strategy will impact their long-term financial planning.
“Yes, they may reduce expenses and have more savings, but does that make up for the reduced years they’ll spend accumulating assets?” she asks. “Those peak earning years are so impactful in terms of funding your retirement.”
How to keep clients who move provinces
Ms. Crowe knows something about interprovincial moves as she relocated to Vancouver from Toronto eight years ago. She and her husband felt the rugged, laidback lifestyle in B.C. better suited her young, growing family. But Ms. Crowe also had a thriving practice with clients in both provinces and hoped that her Ontario clients would remain clients.
“I took a very proactive approach in terms of communicating [my move] with clients,” she says. “I assured them that I still had team members in Toronto to serve them and I made sure I travelled quite frequently to meet with those clients.”
Being licensed in multi-provinces also assists advisors with keeping clients. Ms. Crowe is licensed in eight provinces, Mr. James is licensed in seven, and Mr. Anderssen is licensed in five.
“Unless you want to lose relationships that you enjoy dealing with, being multi-licensed probably makes a lot of sense,” Mr. Anderssen says.
Technology also helps clients to not have to make the shift to another advisor, he adds. Since the pandemic, clients and advisors alike learned to adapt to video technologies such as WebEx, Zoom, and Microsoft Teams, and some now prefer the convenience of meeting virtually instead of scheduling and parking logistics that can come with meeting in person.
By the same rationale, newcomers to the province may not need a new advisor as they continue to use their existing advisor in their former provinces. But Mr. James of CIBC Wood Gundy believes more opportunities will come up to meet them through their “current clientele, and the lawyers and accountants with whom we work.”
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