B8 G THE GLOBE AND MAIL | T U E S DAY , J U N E 1 7 , 2 0 2 5 GLOBE INVESTOR | REPORT ON BUSINESS N early 60 per cent of work- ing Canadians believe they’ll never be able to re- tire, according to a new survey from the Healthcare of Ontario Pension Plan (HOOPP) — a re- flection of how anxiety and fi- nancial instability are reshaping retirement planning across the country. That fear is taking a toll. The annual survey, released Tuesday, also found that 44 per cent of Canadians say their mental health has worsened because of geopolitical instability. Many re- ported feeling anxious, fearful and sad about their finances, with concerns intensifying over the past year. After a long bull-market run that increased the size of many people’s nest eggs, the notion of a comfortable retirement has been upended by a storm of eco- nomic forces. More Canadians are putting off saving, scaling back plans or questioning whether they’ll be able to retire at all. “I feel like history is repeating itself, only worse,” said Alison Smith, a 50-year-old banking pro- fessional in the Greater Toronto Area. “I just don’t have enough. I don’t have enough private sav- ings to survive by the time I re- tire.” Ms. Smith lost her job during the 2008 financial crisis, and even though she was able to find another job, she is still con- cerned about how her savings will stand up to recent market swings. “It’s going to be time to pay the piper pretty soon, and I think we’re all feeling the pres- sure,” she said of her Gen X peers. The survey by HOOPP, which manages pension investments for more than 478,000 members at more than 700 employers in Ontario’s hospital and health care sector, found that almost half of Canadians haven’t set aside any money for retirement in the past year. Thirty-nine per cent say they’ve never saved for retirement at all. More than one- third say geopolitical instability has already affected their travel plans, with many Canadians de- laying or cancelling their trips to the United States. The findings were based on a survey of 2,000 Canadians aged 18 and older from April 11 to 16, 2025. Even for Canadians who have managed to squirrel away some savings, the stress remains. “When the markets are down, they recover faster than a reti- ree’s confidence returns,” said Adam Chapman, a certified fi- nancial planner based in Lon- don, Ont. “The markets come back, but the retirees are still ul- trahesitant and anxious.” Mr. Chapman said that while portfolio values may have stabi- lized, his phone keeps ringing. Many of his retiree clients are overwhelmed, not just by the memory of recent market dips, but by the barrage of news about tariffs, interest rates and global instability. “They’re having a hard time following the news that’s hap- pening, with announcements changing week to week, some- times day to day,” he said. Mr. Chapman points out a technical term in financial plan- ning for what many retirees are going through: “sequence of re- turns risk.” It refers to the risk of a market downturn in the first few years of retirement — a period when reti- rees begin to draw down their portfolios. If the market drops early on, losses can compound faster than if the same dip hap- pened later in retirement. But Mr. Chapman says that on- ly tells part of the story. “That just looks at the num- bers,” he said. “It doesn’t look at what’s the emotional effect of a down market in the first couple of years for a retiree who just re- tired. People are feeling insecure and not confident.” That emotional effect is rip- pling through even the best-laid retirement plans, he said, prompting some to question whether they should have retired in the first place. Jennifer Rook, vice-president of strategy, global intelligence and advocacy at HOOPP, said the emotional toll is reflective of the times. “People are living longer, and we’re in uncertain times,” she said. “Just the very concept of re- tirement is hard for people to think about right now.” Mr. Chapman recommends that soon-to-be retirees, and those already retired, prioritize not just financial planning, but emotional support. That could mean speaking with a mental health professional or working with a financial adviser who un- derstands the psychological toll that retirement can take, he said. Some advisers and firms are recognizing this growing need. Many now pursue additional training to better support clients through the emotional side of re- tirement, including grief, fear and uncertainty about the future. “Really good financial plan- ners and financial advisers go way beyond the math when the math doesn’t work,” Mr. Chap- man said. Our retirement dreams are slipping away New survey finds that anxiety and financial instability are upending plans for workers MEERA RAMAN Which of the following reasons apply to your circumstance of having or not having saved for retirement? 5 (applies completely) 4 3 2 1 (does not play a role) I live paycheque to paycheque I would like to retire as early as possible Not really sure how much I’d need to save, so I haven’t bothered getting into it It’s not urgent for me yet, I have lots of time to save later I don’t care about retirement – I prefer working for longer 26% 29% 15% 12% 18% 21% 33% 18% 12% 16% 12% 31% 19% 19% 20% 8% 25% 17% 21% 28% 9% 24% 17% 21% 28% *Based on an online survey of 2,000 Canadians aged 18 and older from April 11 to 16, 2025. THE GLOBE AND MAIL, SOURCE: CANADIAN RETIREMENT SURVEY APRIL 2025, ABACUS DATA How do you feel about your financial situation? 2025 2024 I worry a lot I feel anxious I feel frustrated I am fearful I feel sad I feel emotionally drained I am easily irritated I feel depressed 52% 45% 52% 45% 50% 46% 48% 43% 47% 41% 47% 38% 44% 36% 43% 37% *Based on an online survey of 2,000 Canadians aged 18 and older from April 11 to 16, 2025. THE GLOBE AND MAIL, SOURCE: CANADIAN RETIREMENT SURVEY APRIL 2025, ABACUS DATA Has the recent geopolitical instability and/or economic uncertainty faced by Canada influenced your saving strategy? No, my strategy has not changed at all Yes, I have started putting more money aside Yes, I have stopped putting money aside I haven’t considered it 43% 22% 18% 18% *Based on an online survey of 2,000 Canadians aged 18 and older from April 11 to 16, 2025. THE GLOBE AND MAIL, SOURCE: CANADIAN RETIREMENT SURVEY APRIL 2025, ABACUS DATA T he newest thing in ex- change-traded funds is an expensive rocket ship for day traders that amps up returns to three times the daily perform- ance of various stock indexes and sectors. Can you get further away from the original ETF mission of pro- viding mainstream investors with a cheap, simple investing alterna- tive to high-cost mutual funds? Theoretically, yes. There is a qua- druple leveraged ETF-type prod- uct in the United States, but for now you won’t see anything simi- lar in Canada. A total of 11 triple-leveraged funds were listed for trading last month by LongPoint ETFs, and four more are to be listed Tuesday by Global X under the BetaPro name. Consider these ETFs a tool for hitting that not-so-sweet spot where aggressive investing meets gambling, and as a reflection of today’s fast-expanding ETF uni- verse. To make their mark in a crowded marketplace, some ETF companies offer products that have no place in the portfolios of investors trying to grow their tax- free savings and retirement ac- counts. Leveraged ETFs are a prime ex- ample. The ideal holding period for these funds is 24 hours, max. Keep them for longer periods and they can deliver unexpectedly sharp losses. Leveraged ETFs use financial instruments called derivatives to provide returns magnifying the daily performance of the underly- ing holdings, typically a stock in- dex such as the S&P 500 or a sec- tor such as semiconductors or banks. You typically get 1.25, two or three times the gains or losses of the underlying index or stocks in a leveraged ETF. A triple-leveraged ETF would rise 3 per cent if the underlying in- vestments gained 1 per cent in a day, and lose 3 per cent if those in- vestments lost 1 per cent. A varia- tion on these funds gives you sim- ilar magnification of inverse re- turns. You win if markets fall and lose if they rise. Leveraged ETFs came to Cana- da 18 years ago in a double-lever- age flavour that left unprepared investors feeling shocked in a bad way about their results over long- er periods of time. In some cases, investors found their losses far exceeded the underlying indexes or sectors. The furor eventually subsided, but getting triple-leveraged ETFs approved by regulators wasn’t easy. “Initially, regulators said, ‘no way, not a chance,’” said Steve Hawkins, CEO of LongPoint ETFs. Mr. Hawkins won the day in large part by quoting a report showing that Canadian investors already held more than $2.5-bil- lion in U.S.-listed triple-leverage ETFs. Introducing Canadian ver- sions of these funds allows for do- mestic regulatory oversight and for economic benefits to flow into Canada rather than the U.S. Regulators worried about the risk of triple-leveraged ETFs being used by unsophisticated inves- tors who didn’t understand what they were buying, Mr. Hawkins said. “But knowledgeable, sophisti- cated, active investors are really our target for these products,” he said. To back this up, LongPoint will be working with regulators and brokers to see if they can de- velop a warning – “almost like a cigarette disclaimer label” – when investors place an order to buy these ETFs. Growth in overall ETF assets has been phenomenal in recent years, with total assets rising by almost 33 per cent in the past year or so to $572-billion. The best ETFs for most investors are ultra low-cost funds tracking widely followed stock and bond indexes. Investor commitment to this type of ETF can be seen in the fact that the four largest ETFs listed on the TSX follow the S&P 500 and the S&P/TSX Composite and S&P/TSX 60 indexes. These four funds alone have close to $70-bil- lion in assets, compared to about $1.5-billion for speculator-fo- cused leveraged ETFs listed on Canadian exchanges. “Passive, ultra low-cost ETFs are still growing at the same rapid rate they always were,” said Da- niel Straus, managing director of ETFs and financial products re- search at National Bank of Cana- da Financial Markets. “I would say we now have something of a dual narrative – the expansion of the ETF industry to encompass more risky assets in parallel with the same story that was there before.” Risk isn’t the only differentia- tor between core index-tracking funds and risky leveraged prod- ucts. While the management ex- pense ratio for big index trackers can be as low as 0.05 per cent, the cost of owning the LongPoint tri- ple-leverage products will be mu- tual fund-like at a little north of 1.55 per cent. “These are the highest fee products in the U.S., and these are going to be the highest fee prod- ucts in Canada as well,” Mr. Haw- kins said. “A lot goes into them.” The BetaPro triple-leveraged funds compete hard on cost – their MER will come in a bit high- er than 0.65 per cent for the dura- tion of the year thanks to a rebate of 0.5 of a point. A sign of the popularity of ETFs today is the firehose flow of new products. Beyond triple-lever- aged funds, recent offerings in- clude index trackers, funds for holding cash, crypto funds and enhanced income funds. Mr. Hawkins sees triple-lever- aged ETFs having a moment right now because of the extreme mar- ket volatility caused by trade war developments. “These ETFs are built for volatility and giving short-term, high-conviction trad- ers an opportunity to capitalize,” he said. Everyone else, please try a sim- ple, low-cost index ETF such as the ones covered in the 2025 Globe and Mail ETF Buyer’s Guide. You could hurt yourself with these new ETF funds ROB CARRICK OPINION The best ETFs for most investors are ultra low-cost funds tracking widely followed stock and bond indexes. U.S. stocks closed higher on Monday, as oil prices retreated after the Israel-Iran attacks left crude production and exports unaffected, easing investor con- cerns about the potential for higher energy prices to stoke in- flation. Canadian equities also rose, though gains were held back by the energy sector. Crude prices settled down more than 1 per cent on hopes a truce was on the horizon between Israel and Iran after days of missile strikes, as Iran called on U.S. President Do- nald Trump to force a ceasefire in the four-day-old aerial war, while Israel’s Prime Minister said his country was on the “path to victory.” Oil prices had surged more than 7 per cent on Friday after Israel began bombing Iran. Teh- ran has asked Qatar, Saudi Ara- bia and Oman to press Mr. Trump to use his influence with Israel to agree to an immediate ceasefire, in return for Iran’s flex- ibility in nuclear negotiations, sources told Reuters. “The wild card is really what’s going to happen to oil prices … any little geopolitical move can have pretty big impacts on that sector and in this economy also,” said George Young, portfolio manager with Villere & Co in New Orleans. “The cases that the consumer pulls in their horns and their nerves about inflation and don’t spend, well, that’s going to have a direct impact on earnings, it doesn’t matter which sector of the economy you’ve invested in.” The Dow Jones Industrial Av- erage rose 317.30 points, or 0.75 per cent, to 42,515.09, the S&P 500 gained 56.14 points, or 0.94 per cent, to 6,033.11 and the Nas- daq Composite gained 294.39 points, or 1.52 per cent, to 19,701.21. The S&P/TSX Composite In- dex ended at 26,568.61, up 64.26 points or 0.24 per cent after earli- er reaching a record intraday high. Energy stocks fell 0.6 per cent, but the technology sector had a strong session, rising 1.3 per cent. Investors are also awaiting the U.S. Federal Reserve’s monetary policy decision on Wednesday, when policymakers are widely expected to keep interest rates unchanged. Money markets are largely not expecting the Fed to cut rates until September, pricing in a 61.1 per cent chance for a cut of at least 25 basis points, according to LSEG data. “Interest rates are still higher and so that one is a bit tough to fathom because perhaps mar- kets are still anticipating some inflation,” said Jack Ablin, chief investment officer of Cresset Capital in Chicago. “If nothing else, just the heightened uncertainty, com- bined with the tariffs is probably keeping the Fed sidelined.” Economic data expected this week in the U.S. includes month- ly retail sales, import prices and weekly jobless claims. Among stocks, U.S. Steel rose 5.1 per cent after Trump ap- proved Nippon Steel’s $14.9 bil- lion bid for the company. Reuters, Globe staff Equities end higher as oil prices pull back on hope of Israel-Iran truce