2008 News Releases

Boomers facing new challenges -- product allocation is very important

Toronto - Manulife Investments is partnering with Dr. Moshe Milevsky, a renowned personal finance expert, and Toronto-based QWeMA Group to provide advisors with a new retirement income strategy focused on product allocation for their clients.

“Rules for managing your money change dramatically when someone retires,” says Dr. Milevsky, author of the recently-released bookAre You a Stock or a Bond? published by Financial Times Press. “Success or failure in retirement rests on what products they own, and specifically the types of protections and guarantees they have to protect their income.”

Every eight seconds, a Baby Boomer hits retirement age across North America, yet unfortunately many may not be well-prepared for the years ahead, he said.

“Many of us go through our lives saving money, and doing it well. But we aren’t necessarily ready to effectively use and protect those savings through retirement,” Dr. Milevsky explains. “Once the time comes to retire, a new set of risks such as our longevity, inflation and market volatility can combine to threaten our financial success.”

Manulife is launching a newRetirement Solutions Centre website for advisors today, ( www.retirementsolutionscentre.ca). The site will include a proprietary tool to be launched Oct. 27. The tool has been developed by Manulife, Dr. Milevsky and the QWeMA Group, for financial advisors across Canada.

Dr. Milevsky, a finance professor at the Schulich School of Business at York University in Toronto, and the QWeMA Group have developed Canada’s first retirement income analysis tool based on Product Allocation for Retirement Income (PrARI™) algorithmic methods.

“Manulife is consistently striving to find new ways to help Canadians better plan their financial lives,” says J. Roy Firth, Executive Vice President, Manulife Financial.

“This initiative complements what Canadians already have embraced – including Manulife One, our flexible home line of credit account, and our more recent initiative ManulifeIncomePlus, Canada’s first guaranteed minimum withdrawal benefit product aimed to protect their retirement income.”

The new product allocation tool separates a client’s portfolio into three retirement product categories: immediate annuities; Guaranteed Minimum Withdrawal Benefit products and traditional products, such as mutual funds with systematic withdrawal plans.

Advisors will have access to the tool to evaluate a client’s current portfolio mix based on those categories, then project how likely an ongoing income stream will be sustainable. The tool can also be used to model product allocation, to provide various product weighting scenarios that advisors can adjust to their client’s individual needs and goals.

Investment products are key
“Everything changes when someone starts to spend their savings in retirement,” explains Dr. Milevsky. “Their success or failure after they retire will hinge more on the type of investment products they own – product allocation – including protections and guarantees, rather than just what types of assets they own.”

Investors need to allocate their assets among three basic different categories, designed to meet the biggest financial risks that face boomers – outliving their savings, inflation and market volatility.

Product allocation
Dr. Milevsky notes that asset allocation can account for 90-95 per cent of investment performance and success when Canadians save for retirement. But as they approach and move into retirement, the type of financial products investors own will determine their financial health in their post-working years. The best approach will ensure lasting income throughout retirement. Manulife Investments believes product allocation plays a greater role in retirement planning success or failure.

To view a video of Dr. Milevsky discussing product allocation, pleaseclick here.

About Manulife Investments
Manulife Investments is the brand name describing certain Canadian subsidiaries and operating divisions of Manulife Financial Corporation that offer personal wealth management products and services in Canada. As one of Canada's leading integrated financial services providers, Manulife Investments offers a variety of products and services including segregated funds, mutual funds, annuities and guaranteed interest contracts.

About QWeMA Group
The QWeMA Group Inc., an abbreviation of Quantitative Wealth Management Analytics Group, develops and licenses unique probability-analytic intellectual property and educational software for the financial services & retirement industry. QWeMA is privately owned and operated by a network of University based financial engineers, computational scientists and applied mathematicians. For more information please visit www.qwema.ca

About Manulife Financial
Manulife Financial is a leading Canadian-based financial services group serving millions of customers in 19 countries and territories worldwide. Operating as Manulife Financial in Canada and Asia, and primarily through John Hancock in the United States, the Company offers clients a diverse range of financial protection products and wealth management services through its extensive network of employees, agents and distribution partners. Funds under management by Manulife Financial and its subsidiaries were Cdn$400 billion (US$393 billion) as at June 30, 2008.

Manulife Financial is one of two publicly traded life insurance companies in the world whose rated life insurance subsidiaries hold Standard & Poor’s Rating Services’ highest “AAA” rating.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘0945’ on the SEHK. Manulife Financial can be found on the Internet at www.manulife.com.

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Media contact:
Tom Nunn
Manulife Financial
(519) 594-8578
tom_nunn@manulife.com