Leaving No Investor Behind: Lessons Learned from a Canadian Success Story

April 21, 2026 – Canada has done a remarkable job persuading Canadians with less than $100,000 of financial wealth to purchase investment funds. Among our peers, Canadians hold the highest proportion (20 percent) of their financial assets in investment funds compared to other OECD countries.

The country’s limited investment advice system is a rare success story among advanced economies, delivering widespread, affordable access for modest investors, but preserving that success will require careful regulatory choices, according to a new report from the C.D. Howe Institute.

In “Getting it Right – Lessons Learned from Regulating Limited Investment Advice,” Paul C. Bourque examines how Canada’s regulatory framework has supported broad access to limited investment advice, particularly for households with less than $100,000 in investable assets. The report highlights the role of front-line self-regulation, now delivered through the Canadian Investment Regulatory Organization (CIRO), along with tailored mutual fund dealer rules and flexible compensation structures that help keep advice accessible at low cost.

The report finds that access to advice has delivered measurable benefits. Investors who receive advice accumulate greater wealth over time and show more disciplined financial behaviour, including higher savings rates and a greater likelihood of staying invested during periods of market volatility.

“Canada’s system has made limited investment advice accessible to millions of modest investors,” says Bourque. “That access has real economic value, helping households build wealth and make better financial decisions over time.”

A big driver of this success is Canada’s distinctive regulatory approach, including front-line self-regulation through CIRO and a mutual fund dealer category that allows firms to operate at lower cost by focusing on a narrower range of products.

The report also highlights the importance of flexible compensation models, including embedded fees, which allow investors to pay for advice as part of the investment product rather than through upfront charges. Evidence from jurisdictions such as the UK and Australia suggests that restricting these models can contribute to reduced access to advice for modest investors, particularly where upfront fees become more prominent.

But access to advice for smaller accounts is increasingly under pressure. Rising compliance costs and industry consolidation risk limiting availability, particularly for investors with less than $10,000 to invest.

To preserve and extend Canada’s success, Bourque recommends maintaining effective self-regulatory approaches, placing greater emphasis on competition and efficiency in financial regulation, and carefully assessing the applicability of foreign reforms before adopting them in the Canadian context.

The report also suggests that elements of Canada’s approach, particularly self-regulation, could be considered for other sectors, such as insurance, subject to careful assessment of costs, complexity, and regulatory feasibility.

“Canada’s experience shows that well-designed regulation can expand access to financial advice without compromising investor protection,” says Bourque. “The challenge now is to ensure that new rules do not unintentionally reduce that access.”

Read the Full Report

For more information, contact: Paul C. Bourque K.C., Senior Fellow, C.D. Howe Institute; Percy Sherwood, Associate Editor and Communications Officer, C.D. Howe Institute, 416-407-4798, psherwood@cdhowe.org.

The C.D. Howe Institute is an independent not-for-profit research institute whose mission is to raise living standards by fostering economically sound public policies. Widely considered to be Canada’s most influential think tank, the Institute is a trusted source of essential policy intelligence, distinguished by research that is nonpartisan, evidence-based and subject to definitive expert review.

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