Diversity in Canada is expected to grow, with visible minorities making up to 32% of the population in 2031.* Immigration will continue to be the main driver of population growth. This is the first article in a series to help you understand these fast-emerging markets and the opportunities they present.

Susan Fu, an independent, Vancouver-based advisor, works primarily with the emerging Chinese market. “This is a very affluent market. A very significant market,” describes Fu — especially those she calls investor immigrants. As she mentions, they come to Canada from China with a lot of money to invest in their new home country; some also build their own business.

Fu’s worked in the financial services industry for over 12 years and started her own company in 2008, called Vanstar Financial Inc. Working with Chinese clients has brought her a lot of success and she shares what she’s learned about this market.

A wealth of opportunity

The Chinese now make up over 20% of the country’s visible minority population — and it’s growing.* By 2031, the Chinese population in Canada is expected to grow from 1.3 to 2.4 million.* This will lead to a growing visible minority retiree market.

What sets the Chinese market apart is their high level of education and professional skills. And since most Chinese are between the ages of 25 and 44 — prime years for earning income — they’re an attractive market for advisors. In the future, they’ll be an important group in Canada’s pre-retiree market. By helping them start financial plans now, you’re putting them on a path toward lifetime financial security.

Fu experiences firsthand why it’s important to work with this market. “They bring a lot of assets from overseas to Canada. Not only helping themselves, also helping the society, helping the economic growth.”

A conservative approach to investments and insurance

When it comes to investing, Chinese clients usually have two main goals: keep their money safe and minimize taxes.

  • Keep their money safe – While many Chinese clients invest overseas and look for growth in investments held in China, they prefer to take less risk with the money they have in Canada.
  • Minimize taxes – Chinese clients will appreciate your help in reducing their tax bill. Giving them solutions to minimize income taxes will help you meet their needs.

This conservative approach to investing and taxes also makes Chinese clients well-suited to insurance products. “They know that protection is important,” says Fu, “and insurance is a tax-sheltered investment vehicle.” Just be prepared to educate Chinese clients on insurance first.

Taking care of life and legacy

Many Chinese clients like to invest in real estate, which paves the way for conversations about life insurance. When clients hold mortgages, life insurance can help cover their debt when they die. And since it’s common for Chinese clients to purchase real estate for family members, it can be a starting point for legacy planning discussions.

Saving for retirement

When it comes to retirement, many Chinese clients place their confidence in personal savings. “They’ll take care of themselves. They won’t rely on the government,” states Fu. This highlights the need for lower-risk investments. Since Chinese clients expect their money to generate monthly income for expenses, a source of stable income is important. Solutions like segregated funds that come with growth potential but also provide protection can be a good fit. Payout annuities with guaranteed income are another valuable option.

Getting started

Understanding and working with the Chinese community gives you the opportunity to discuss insurance, wealth and retirement solutions with potential clients. Chinese clients look to you to provide more than just financial advice — they’re looking for someone to help them settle in and adjust to their new country. And while Fu admits that speaking Chinese is an advantage, this shouldn’t discourage you from reaching out to this community.

To help you meet customer needs in this market, Sun Life Financial offers information and tools in simplified Chinese — helping you build rapport and become their trusted advisor.

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*All demographic and population information is taken from Statistics Canada, 2011.