Seymour is 76 years old. Married at the age of 23, his wife passed away five years later in a car accident, leaving Seymour alone to raise their two children. Seymour worked until he was 55 and retired from his company, a large oil & gas firm, having been a drill rig mechanic for 30 years. At that point he decided that he was finished; ready to enjoy the retirement life and hoping he would never have to go back to work. He volunteers for several charities now, and he helps out at his church wherever he can. So he is busy, but he has no income other than his pension, CPP, and OAS. Financially things were working very well until last year - Seymour's youngest son Devon, also a bachelor, had been living with Seymour and sharing many expenses. As a lawyer, Devon's income was strong and very consistent, so any potential shortfall in Seymour's income was handled by Devon sharing the domestic expenses. Unfortunately Devon's client base in Eastern Canada had grown to the point where Devon relocated to Halifax last September, leaving Seymour on his own to handle his expenses. With $450,000 in his money-purchase pension account, Seymour believes that his pension assets are on the 'thin' side. When he looks at his family history hisaunts, uncles, grandparents and parents all seemed to live long, healthy lives; in fact, he had many relatives that made it well into their 90's, with a few that were over 100 years old before they passed. Living in Vancouver, he needs at least $65,000 per year just to get by, and he is afraid that with his spending rate his assets might not live as long as he will. So Seymour has decided to increase the return on his retirement portfolio by shifting the asset allocation to small cap stocks, venture stocks, and options. To this point, the fund's investment allocation has been exclusively in balanced mutual funds. Seymour is not a person who takes risk in life, so the match has worked for him very well. You've been thinking that Seymour's emotional capacity for risk and his financial capacity for risk are quite mismatched. 

Is this important, at this stage in his life? 

Given his current financial situation what advice should you give him? Discuss.

Answer rating: 100% (QA)

Given Seymours age financial situation emotional capacity for risk and the mismatch between his emotional and financial capacity for risk it is indeed crucial to address this imbalance to ensure Seymo... View the full answer