The Prosperity Partner

Life Transitions: Laura's Attempts at Balance

Wed, 15 Apr 2026 18:05:20 GMT

Life Transitions

When my kids were very young, it felt like the moment we finally got the hang of their routine, they would change it. It was a great way to keep our egos in check and make sure we never got too comfortable.

Life has a funny way of doing that. Just when things seem to settle into a rhythm, whether good or bad, everything shifts again. Right now, I find myself in the middle of not one, but two of these transitions.

My mom is 91 and lives in assisted living. We recently moved her from Victoria, where she and my dad lived for 47 years, to a home located between my sister Leslie and me.

It’s both a blessing and a challenge. The shift from being the child to becoming the parent in the relationship is hard, both emotionally and physically.

Mom is doing quite well, but her mobility is limited and she often feels lonely.

I miss the relationship that we used to have too.

At the same time, our daughters have been living in Ontario since they were 18. They both went to university there, and Rachel decided to stay, building a vibrant life in downtown Toronto. She loves her job, her friends, and her fitness routine.

Leah is graduating and moving home in April, but she’s eager to find a well-paying job so she can travel.

Living with her parents in the suburbs is not exactly part of her ideal life plan, and I completely understand.

So how do I manage these transitions?

1. Remembering That I’m Not Alone
Many of my friends and clients are navigating similar situations with their parents, which makes it comforting to share experiences and simply know that others understand.

I’m also very fortunate to have both one brother and my sister to share the load. That kind of support is unique and incredibly helpful.

Sometimes we exchange practical ideas, but mostly it’s just the sense of connection and teamwork that makes all the difference.

2. Focusing on Gratitude
Gratitude has always been a powerful mindset shift for me. I regularly write down what I’m thankful for. I’m grateful that both of my daughters are healthy, happy, and thriving.

I’m also thankful that my mom is still enjoyable to be with and that I can spend this time with her.

The alternative is far less pleasant.

3. Taking Care of Myself
Exercise is my biggest anchor. While it doesn’t always happen as often as I’d like, I usually manage to fit in a few workouts each week. It makes a tremendous difference to my energy and outlook.

4. The Glass is ½ Full

I am optimistic by nature, so this isn’t too hard to do. I try to focus on the positive. With both girls finished school, our expenses have decreased significantly, which is great!

As for my mom, I now manage her finances and pay her bills—something I actually enjoy—so even this responsibility has a positive side.

I also have more time to myself so I have been able to get reacquainted with some old friends, especially ones who didn’t have kids and we drifted apart.

That has been great to reconnect.

Life is full of transitions, whether we’re ready for them or not. I once heard someone describe life as “brutiful”—both brutal and beautiful at the same time.

That feels especially true right now.

How do you manage during times of transition?

Source:https://lean-forward.com/the-stages-of-life-transitions-and-how-to-navigate-them/

Market Update: April ~ A Choppy Start to Spring Markets

Wed, 15 Apr 2026 18:05:16 GMT

Riding the Swings: Staying on Track

It’s been another interesting stretch in the markets since our last update.

After a strong start to the year, March was much more volatile, and April has continued that pattern with big swings in both directions. We’ve seen markets drop quickly and then rebound just as fast, which can feel unsettling when you’re watching it day to day.

Where are markets now (roughly year to date)?

Canada (TSX): still up about 3% for the year despite a tough March
U.S. (S&P 500): slightly down year to date after recent volatility
International markets: generally modestly positive, with Europe and Japan holding up better earlier in the year

So overall, it’s a bit of a mixed picture. Canada has held up better, while the U.S. has been bumpier.

Why all the volatility?

There isn’t just one reason right now. It’s a combination of a few big themes:

1. Geopolitics and oil prices
Ongoing tensions in the Middle East have pushed oil prices higher at times, which creates uncertainty for markets. When oil spikes, markets often react quickly, especially in the U.S.

2. Tariffs and global trade
We’re still seeing the ripple effects from last year’s “Liberation Day” tariffs. Trade uncertainty tends to create stop and start markets, as companies and investors adjust expectations.

3. Interest rates and inflation
Inflation is still not fully under control, and investors are trying to figure out when and how much central banks will cut rates. That uncertainty alone can cause markets to move around quite a bit.

4. Technical factors (this one is less obvious)
Some large institutional strategies actually buy and sell automatically based on volatility. In March, these strategies amplified the downturn by selling into weakness, which made the drop feel worse than it otherwise might have been.

The big picture

Even though markets feel choppy right now, a few important things are still true:

Companies are still making money
Economic growth is slow but positive
Interest rates are expected to trend down over time

That’s why you’re seeing markets recover quickly after dips. For example, the S&P 500 recently had one of its strongest short-term rebounds in the past year after a rough patch.

What this means for you

This is a very normal part of investing, even if it doesn’t feel like it in the moment.

Markets don’t go up in a straight line. They move in fits and starts, especially when there is uncertainty in the world. The key is staying focused on the long term and not reacting to short term noise.

If anything, periods like this are a good reminder of why we diversify and stick to a plan.

As always, if you have questions or just want to talk it through, I’m here.

Source: www.bloomberg.com

ADHD: Building Financial Habits That Fit Your Life

Wed, 15 Apr 2026 18:05:13 GMT

Making Money Work With an ADHD Brain

We often hear that saving money should be simple. Spend less. Save more. Stay disciplined.

But for many people, especially those with ADHD, it doesn’t feel simple at all.

It can feel inconsistent, overwhelming, and at times even discouraging. Not because you don’t care. And not because you don’t understand what to do. But because the way traditional financial systems are set up doesn’t always match how your brain works.

And that matters more than we often acknowledge.

ADHD affects how we experience time, reward, emotion, and organization. All of those play a role in how we manage money. So when something feels hard, it’s often not about willpower. It’s about fit.

Why It Can Feel So Challenging

One of the most common patterns we see is impulse spending.

In the moment, spending can feel like relief. A way to regulate stress, boredom, or overwhelm. The challenge is that the consequences show up later. This isn’t about not knowing better. It’s about how the brain prioritizes immediate comfort over future impact.

Time plays a role too.

For many people with ADHD, the future can feel distant or abstract. So saving for something months or years away doesn’t always carry the same emotional weight as spending today. That makes consistent saving feel harder than it “should” be.

And then there’s anxiety.

Money can become something we avoid. Not because we don’t want to deal with it, but because it feels heavy. Opening statements, tracking spending, or even checking balances can trigger stress or shame. Over time, that avoidance can quietly make things more complicated.

Add in the challenge of organization, and it makes sense why traditional budgeting doesn’t always stick.

A Different Way to Approach It

What we’ve found is that the goal isn’t to “try harder.” It’s to build systems that actually support how your brain works.

That often starts with simplifying.

A clear goal can make a big difference. Whether it’s building a small emergency fund, paying down debt, or saving for something meaningful, having direction helps guide decisions.

Simple budgets tend to work better than detailed ones. Focus on the essentials first, and allow for some flexibility. It doesn’t have to be perfect to be effective. Automation can also be a game changer.

Setting up automatic bill payments or transfers to savings reduces the number of decisions you need to make. Less decision-making means less friction.

Keeping things organized doesn’t need to be complicated either. One folder. One system. Something you can actually maintain, even on busy days.

Creating Space Between You and Spending

Small changes can make a big difference.

Slowing down the moment of purchase. Using lists. Limiting payment methods. Even just pausing before buying something non-essential.

The goal isn’t restriction. It’s creating a bit of space so you can make a more intentional decision.

And just as important, not doing it alone.

Talking openly with a partner, a trusted person, or a financial professional can reduce the mental load. Money becomes easier to manage when it’s shared, not carried quietly in the background.

A More Compassionate Perspective

This is the part that matters most.

Difficulty saving or managing money is not a moral failing. It’s not a lack of motivation.

Often, it’s a sign that the systems you’ve been given don’t fit how you’re wired.

When you start to shift that perspective, everything changes.

Instead of fighting against yourself, you begin to build something that works with you. Over time, that can reduce stress, create more stability, and build a sense of confidence that extends well beyond your finances.

If this resonates, you’re not alone.

And there are ways to make this feel easier, more manageable, and more aligned with your life.

Source:www.infocuscounselling.com

Family & Financial Planning: Protecting a Gift. Supporting Their Future

Wed, 15 Apr 2026 17:54:04 GMT

Question: If you give you adult child a gift of money how can it be protected in the event of her marriage breakdown?

This is such a good question and one that comes up a lot, especially as parents want to help but also want to be thoughtful about protecting that help.

In Canada, a gift to an adult child is generally considered their property , but what happens in a marriage breakdown depends on how that money is handled.

Here are the key ways to protect it:

1. Keep the gift clearly separate

This is the simplest and most important step.

If your daughter keeps the money:

in an account in her name only , and
does not mix it with joint accounts or shared spending

then it is much easier to argue that it remains excluded property (in BC, this is the term used).

Once money is mixed (for example deposited into a joint account or used for shared expenses), it can lose that protection.

2. Be very careful if it is used for a home

This is the big one where people get caught.

If the gifted money is used to:

buy a matrimonial home, or
pay down the mortgage on a shared home it often loses its protection , even if it was originally a gift.

In many cases, the family home is treated differently and is shared regardless of where the money came from.

3. Document that it is a gift (not a loan)

You should have something in writing that clearly states:

this is a gift , not a loan
it is intended for your daughter only
it is meant to be excluded from any division of family property

A simple signed letter is often enough, but it should be clear and dated.

4. Consider a cohabitation or prenuptial agreement

This is the strongest protection.

A cohabitation agreement or prenup can:

specifically state that the gift (and anything it grows into) remains your daughter’s
override default provincial rules

Without this, you are relying on how the law interprets things after the fact.

5. Keep a clear paper trail

This helps support everything above:

transfer from your account directly to hers
note in the transfer or accompanying letter that it is a gift
avoid informal cash movements

6. Growth on the gift can matter

In BC, the original gift may be excluded , but:

any growth or income on that money during the relationship may be shared

So how the money is invested and tracked also matters.

Question: is this different from an inheritance?

The answer is yes and no .

In BC, gifts and inheritances are treated very similarly , but there are a few practical differences that really matter.

The big picture

Gifts from parents
Inheritances

Both are generally considered excluded property under BC family law. That means they are not divided in a marriage breakdown, as long as they are handled properly.

Where they are the same

For both gifts and inheritances:
They are protected if kept separate .
They can lose protection if mixed with joint assets
Using them for a family home can override protection
Any growth during the relationship may be shared

So from a legal standpoint, they start in the same bucket.

Where they are a bit different (practically)

1. Inheritances are often easier to prove

With an inheritance, there is usually:

a will
estate documents
a clear paper trail

With a gift, it can be more informal, which is why documentation is so important.

2. Timing is different

Gifts are often given during the relationship
Inheritances often come later or unexpectedly

So with gifts, there is more risk of:

being deposited into joint accounts
being used for shared goals right away

3. Emotional and legal expectations

Courts tend to view inheritances as: more clearly “meant for one person

Whereas gifts can sometimes get blurred into: “support for the couple” especially if there is no clear documentation.

The biggest trap is still the same

Whether it is a gift or inheritance: If it goes into the family home, it is usually no longer protected .

That is the one area where people are often surprised.

How I explain it simply

Legally : very similar
Practically : inheritances are usually easier to protect
Risk : comes from how the money is used, not where it came from

A really helpful framing is: “It is not the gift or inheritance itself that causes problems. It is what you do with it after.”

Source:www.legalline.ca

Retirement Isn’t a Finish Line

Thu, 19 Mar 2026 19:34:25 GMT

Retirement isn’t a finish line. It’s a transition into what comes next

For years, retirement is something you work toward. You save, invest, and plan with a clear goal in mind.

But when it gets closer, the conversation changes.

The questions start to sound different:

Do we have enough?
Can we retire sooner?
Are we making the right decisions?

These questions matter. But underneath them is something deeper.

Am I going to be okay?

That’s where real planning begins .

A good retirement plan goes beyond investments. It looks at how your savings turn into income, how taxes and government benefits fit in, and what your spending might actually look like over time.

Because when you can see how it all connects, retirement stops feeling uncertain. It starts to feel real.

Just as important is the life side of retirement:

What do your days look like without work.
What are you excited about.
Where do you want your time and energy to go.

Retirement isn’t just about having enough. It’s about stepping into a life that feels meaningful and aligned with what matters to you.

When those pieces come together, the biggest shift isn’t just in the numbers.

It’s in how you feel. Clarity replaces uncertainty. Confidence replaces hesitation.

And instead of wondering if you’re ready, you start to feel like you are.

Source: www.https://retirehappy.ca/

March Market Update: Navigating Uncertainty With Perspective

Thu, 19 Mar 2026 19:34:02 GMT

Markets, Oil, and the Iran Situation: What Investors Should Know

If you’ve glanced at your investment statements lately and then seen the headlines about Iran, the U.S., and Israel, you might be feeling a bit unsettled. That’s completely understandable.

Periods like this can make even the most experienced investors pause and wonder what it all means for their plans.

The short answer is this: markets don’t like uncertainty, but they have a long history of working through it and recovering over time.

Let’s walk through what’s happening and what it may mean, both now and looking ahead.

What Is Happening Right Now

Recent military escalation involving Iran has raised concerns about the stability of energy supply in the region. The Middle East remains one of the most important energy corridors in the world, particularly the Strait of Hormuz, where about 20% of global oil shipments pass.

As tensions increased, oil prices briefly moved above $100 per barrel. When oil rises, it tends to ripple through the economy. It can increase transportation costs, add to inflation, and create concerns about slower growth.

Financial markets have reacted in fairly typical ways:

Energy stocks have moved higher
Gold has risen as investors look for stability
Stock markets have been more volatile day to day

If you’re looking at your portfolio and seeing some fluctuation, you’re not alone. This is exactly how markets tend to behave in moments like this.

Short-Term Market Impact

This is usually the hardest part emotionally.

Geopolitical events often create sharp, short term reactions. Investors tend to respond quickly to uncertainty, sometimes selling first and asking questions later. That can show up as:

More noticeable ups and downs in markets
Rising oil prices
A shift toward more conservative investments

It can feel discouraging to see values dip, especially when nothing about your personal plan has changed. But these periods are typically disruptive, not destructive.

Right now, the key issue is whether oil supply is actually interrupted. If it is, prices could stay higher for a while. If not, things often settle faster than expected.

Longer-Term Market Outlook

This is where it helps to take a step back. Even though headlines can feel intense, markets have consistently shown resilience through events like this.

A few reasons why:

1. Companies are still earning money
Over time, stock markets follow earnings. Unless there is a deep and lasting impact on the global economy, businesses continue to grow.

2. Energy sources are more diversified
The world is less dependent on any one region than it was in the past, which helps reduce long-term risk.

3. Markets adjust quickly
Markets tend to absorb bad news fairly quickly and then move forward once there is more clarity.

In many past geopolitical events, markets recovered within weeks or months, even when the situation felt very uncertain at the time.

What Investors Should Remember

If you’re feeling uneasy right now, that’s a very normal reaction.

Seeing markets move around and reading difficult headlines can make it tempting to want to “do something.” But often, the most important thing is to stay grounded in your plan.

These types of events have always been part of investing. Wars, elections, financial crises, and pandemics have all created uncertainty along the way. And yet, over time, markets have continued to grow.

A well-structured, diversified portfolio that reflects your goals is designed to weather periods exactly like this.

The Bottom Line

Right now, the Iran situation is affecting markets mainly through oil prices and inflation concerns.

If the conflict remains contained, this is more likely to be a period of short term volatility rather than a lasting change to the global economy.

It may not feel great in the moment, especially when you’re looking at your statements, but this is one of those times where patience really matters.

Over time, markets have rewarded investors who stay focused on the bigger picture.

Please reach out if you’d like to talk through your portfolio or just want some reassurance. These are exactly the moments where a conversation can help bring things back into perspective.

Source: www.bloomberg.com

Client Success Story: Confidence Comes From Clarity

Thu, 19 Mar 2026 19:33:29 GMT

The Real Question Wasn’t Investments. It Was Confidence

A couple came to see me a few years ago who were getting closer to retirement and starting to feel a little uneasy.

On paper, they had done many things right. They had saved consistently for years, owned their home, and had built up a combination of RRSPs, TFSAs, and some non registered investments. They were still saving a bit each year as well, but they weren’t sure where that extra money should go.

As retirement got closer, the questions started creeping in.

Do we actually have enough?
What if we retire and then run out of money?
Should we be investing differently now?
And where should we be putting our extra savings?

This is something I see quite often. People spend decades building their savings, but as the finish line gets closer the uncertainty can actually increase.

They told me they didn’t want to make a mistake so close to retirement. They had worked hard to build what they had and didn’t want one poor decision to undo years of careful saving.

So instead of starting with investments, we started with the bigger picture.

We built a retirement plan that looked at their spending today, what life might realistically cost in retirement, government benefits like CPP and OAS, taxes, and how their investments would support them over the next 30 years.

When we ran the numbers, something interesting happened.

They were actually in better shape than they thought.

With the savings they already had and a few more years of contributions, retiring in their early 60s looked very achievable. The extra savings they were adding each year could be directed more strategically rather than just going wherever there was room.

We simplified where their money was going and made sure their investments matched their timeline. Funds they may need in the earlier years of retirement were positioned more conservatively, while the money intended for later years could continue to grow.

One of the things that meant a lot to them was their children. Like many parents, they hoped that if the time came when their kids were ready to buy their first home, they might be able to help a little.

Through the planning process, they realized that this was likely possible without compromising their own retirement security. That was a big relief. They could take care of their future and still be in a position to support their family if they chose to.

We also spent time talking about something that often gets overlooked in retirement planning.

What does life actually look like after work?

For many people, retirement is not just a financial transition. It’s a life transition. We talked about how they might spend their time, the activities they enjoy, travel they hoped to do, and how they wanted to stay engaged and purposeful in this next chapter of life.

By the end of the process, the biggest change wasn’t just the numbers. It was how they felt.

Instead of wondering whether they would be okay, they could see a clear path ahead. Retirement stopped being an abstract idea and became a well thought out plan.

And perhaps most importantly, they could start looking forward to the next phase of life with confidence rather than uncertainty.

Laura

The 3 Buckets of Modern Retirement

Mon, 23 Feb 2026 21:55:07 GMT

For many people, retirement planning used to mean one thing.

Build a nest egg. Withdraw 4 percent. Hope it lasts.

Today, it’s more nuanced than that.

Retirement isn’t a single number. It’s a structure. And one of the simplest ways to think about it is in three buckets.

1. Income Security. Your Foundation

This is the base layer. The income you can rely on.

CPP
OAS
Company pensions
Annuities
Conservative, dependable investments

This bucket answers one core question. “If markets fluctuate, are my essential expenses still covered?”

Housing, groceries, utilities, insurance, basic living costs. Those should feel steady and predictable.

When this bucket is solid, everything else becomes less stressful.

2. Lifestyle & Flexibility. The Freedom Bucket

This is where retirement starts to feel personal.

Travel.
Season tickets.
Helping adult children.
Renovations.
That hobby you finally have time for.

This bucket is typically funded through investment portfolios that can tolerate some growth and some movement. It is designed to give you flexibility, not anxiety.

The key here isn’t just growth. It’s having a strategy for how and when to draw from it in a tax-efficient way.

This is often where thoughtful planning makes the biggest difference.

3. Legacy & Impact. The Intentional Bucket

This one is often overlooked.

Gifting to children or grandchildren
Charitable giving
Leaving a meaningful estate
Supporting a cause you care about

Some clients want to spend confidently. Others want to preserve intentionally. Most want a balance of both.

Planning this bucket properly can involve insurance strategies, estate coordination, beneficiary designations, and tax planning.

It’s about ensuring your money moves where you want it to, in the most efficient way possible.

Why This Framework Matters

When everything is blended into one big number, retirement can feel overwhelming.

When it’s organized into purpose-driven buckets, clarity replaces anxiety.

You can see:

What is guaranteed
What is flexible
What is legacy

And you can make decisions from a position of confidence rather than reaction.

Retirement planning isn’t just about getting to a date on the calendar.

It’s about structuring your resources to support the life you want to live, and the impact you want to have.

Source: Moneysense.ca

Getting Your Tax Information Ready for 2026

Mon, 23 Feb 2026 21:55:04 GMT

Because April should not feel like a fire drill.

Tax season doesn’t have to be stressful.

With a little organization and a few proactive check-ins, filing your 2026 return can feel routine rather than rushed.

Here’s how to stay ahead.

1. Create a Dedicated “Tax Folder”

Set up one physical folder and one digital folder labeled 2026 Taxes .

Throughout the year, add documents as they arrive, such as:

T4 slips from your employer
T3 and T5 slips for investment income
RRSP contribution receipts
Charitable donation receipts
Medical expense receipts
Tuition slips
Property tax statements
Pension income slips

Having one centralized location reduces the risk of missing something when it’s time to file.

2. Know Which Slips to Expect

Depending on your situation, you may receive:

T4 from your employer
T3 / T5 from investment providers
T4A(P) for CPP
T4A for all nonemployment income including Old Age Security, annuities, scholarships, RESP, RDSP & self employment income
RRSP receipts
Pension slips from private pension providers

If you are self-employed, you are responsible for tracking all business income and eligible expenses throughout the year.

Note. Self-employed individuals typically have until June 15 to file, but any balance owing is still due by April 30 to avoid interest.

3. Track Deductible Expenses as You Go

Some expenses qualify for tax credits or deductions, subject to CRA rules and income thresholds. Common examples include:

Medical expenses
Charitable donations
Childcare expenses
Certain employment expenses

Rather than sorting receipts at year-end, consider uploading or organizing them monthly.

Consistency prevents last-minute scrambling.

4. Review RRSP and TFSA Contributions Early

RRSP contribution decisions should ideally be made before the deadline approaches.

An RRSP contribution may be beneficial if:

You are in a higher marginal tax bracket this year
You expect lower income in retirement
You want to reduce taxable income for specific planning reasons

TFSA contributions do not provide a tax deduction, but growth and withdrawals are generally tax-free.

Contribution room for both can be confirmed through CRA My Account.

5. Be Aware of Life Changes

Certain events can materially affect your tax situation, including:

Retirement
Sale of property
Large capital gains
Starting or selling a business
Moving provinces
Changes in marital status

In Canada, your province of residence on December 31 determines your provincial tax rate for the year.

If your situation changed during 2025, it may impact your 2026 filing.

6. Review CRA My Account Periodically

CRA My Account allows you to:

Confirm slips issued under your SIN
May show if you owe money to the CRA or if they owe you
Track RRSP contribution room
Review instalment requirements if applicable
Verify direct deposit information

Not all taxpayers are required to make instalments. Instalment reminders apply only if you meet CRA thresholds based on prior tax owing.

7. Think Beyond Just Filing

Filing your return is compliance. Tax planning is strategy.

Depending on your situation, planning opportunities may include:

Pension income splitting after age 65
Strategic realization of capital gains or losses
Use of spousal RRSPs
Charitable giving strategies
Insurance planning

These strategies depend on your marginal tax rate, income level, and long-term goals. They should be reviewed in the context of your broader financial plan.

The Bottom Line:

The goal is clarity and preparedness.

A little organization throughout the year reduces errors, missed credits, and unnecessary stress. More importantly, it creates space for thoughtful planning rather than reactive decisions.

Good tax planning starts long before the deadline.

Source: www.canada.ca

Segregated Funds

Mon, 23 Feb 2026 21:55:01 GMT

What Are Segregated Funds. And When Do They Make Sense?

You may have heard the term “segregated fund” in a planning conversation and wondered how it differs from a traditional mutual fund.

On the surface, they can look similar. Both invest in diversified portfolios of equities and bonds. Both participate in market growth.

The difference is structural.

Segregated funds are investment contracts issued by life insurance companies. Because they are insurance contracts rather than traditional investment accounts, they can include features that mutual funds and ETFs do not.

Let’s look at what that means.

What Is a Segregated Fund?

A segregated fund is a pool of investments offered through an insurance company. Investors purchase units within an insurance contract, not units of a mutual fund trust. This insurance structure allows certain contractual guarantees and estate features to be built in.

Key Features of Segregated Funds

1. Maturity and Death Benefit Guarantees

Most segregated fund contracts offer guarantees of 75 percent or 100 percent of net deposits, subject to contract terms.

The maturity guarantee typically applies at a specified maturity date, often 10 years from each deposit.
The death benefit guarantee applies upon death of the annuitant.
Withdrawals generally reduce the guaranteed amount proportionally.
Some contracts include optional reset features that can increase the guaranteed base.

If market values decline and the contract is held to maturity, or the annuitant passes away, the insurer may top up the value to the guaranteed amount. Guarantees apply at specific contractual events, not daily.

2. Estate Planning Features

When a valid beneficiary is designated, segregated fund proceeds may pass directly to that beneficiary outside of the estate, subject to provincial legislation.

This can:

Reduce or avoid probate fees in certain provinces
Maintain privacy compared to a probated will
Allow for faster distribution of proceeds

Rules vary by province, and beneficiary designations must be properly structured.

3. Potential Creditor Protection

Under certain circumstances, segregated funds may offer creditor protection when a qualified family class beneficiary is named, such as a spouse, child, grandchild, or parent.

Protection is not absolute. It depends on:

Proper contract structure
Timing and intent
Applicable provincial and federal laws

This feature can be particularly relevant for business owners and incorporated professionals.

4. Market Participation With Downside Guardrails

Segregated funds participate in market growth, and like mutual funds, earnings are taxed annually based on distributions allocated within the contract.

The insurance guarantees provide a contractual downside floor at maturity or death, not ongoing protection against daily market fluctuations.

Trade-Offs to Consider

Segregated funds typically carry higher management expense ratios than comparable mutual funds or ETFs. The insurance guarantees and estate features contribute to these costs.

They also include contractual maturity periods that need to be understood before investing.

They are not inherently better or worse than other investment options. They are designed to solve specific planning needs.

When Might Segregated Funds Make Sense?

They may be appropriate for:

Investors nearing retirement who value a maturity or death benefit guarantee
Individuals focused on estate efficiency and smoother wealth transfer
Business owners seeking potential creditor protection
Clients who prioritize contractual guarantees alongside market exposure

They may be less appropriate for:

Younger investors with long time horizons and high risk tolerance
Fee-sensitive investors who do not require insurance features
Investors comfortable managing estate planning through other structures

The Bottom Line

Segregated funds are insurance contracts with investment components. In the right circumstances, they can provide estate efficiency, contractual guarantees, and potential creditor considerations.

In other situations, they may simply add cost without adding meaningful benefit. The key question is not whether segregated funds are good or bad.

It is whether their specific features align with the planning objectives at hand.

Source: www.canada.ca

*Insurance products are provided through iA Private Wealth Insurance Agency which is a trade name of PPI Management Inc. Only products and services offered through iA Private Wealth Inc. are covered by the Canadian Investor Protection Fund.

February Market Update

Mon, 23 Feb 2026 21:54:59 GMT

More Than Just the “Magnificent Seven"

Based on my recent conversations with one of the investment managers we use at Right Direction Financial, AGF Investments, I wanted to share some of their current thinking on markets and what they are watching closely.

If you have been watching the headlines lately, you would be forgiven for thinking markets should be far more volatile than they are. Geopolitical tensions from Iran to Venezuela to Greenland, questions about U.S. debt, and constant political noise have made for a busy news cycle. And yet, markets have been surprisingly steady.

One of the biggest places this uncertainty has shown up is in the U.S. dollar, which has been weaker since last year. That matters, because a softer U.S. dollar tends to support international markets and hard assets like commodities and gold, and that is exactly what we have been seeing.

A weaker dollar and stronger global markets

Over the past year, international markets have outperformed the U.S., helped by a weaker U.S. dollar, a global wave of interest rate cuts, and large fiscal spending programs in places like Germany, Japan, and the U.S. We are also seeing improving conditions in parts of emerging markets.

Gold surged last year, copper prices have risen, and commodity producing countries are seeing renewed interest, partly due to demand from AI, data centres, and electrification.

This is a reminder that diversification outside the U.S. really matters, especially when currencies and global growth cycles start to shift.

Earnings still drive markets

One simple but powerful stat from AGF is that equity markets have about a 0.96 correlation with earnings. In plain English, over time, markets mostly follow company profits.

Right now, earnings expectations are still healthy. S & P 500 earnings growth is expected to be around 15 percent this year. Mid cap earnings growth is expected to be about 19%. Small cap earnings growth is expected to rebound strongly.

About three quarters of companies are beating earnings and sales expectations.

That is a big reason why, despite all the noise, markets have remained resilient.

A broader market, not just tech

For the past few years, returns were dominated by a small group of mega cap tech stocks, the so called Magnificent Seven. The view from AGF is that we are now in a phase of market broadening and rotation.

In other words, returns are starting to come from more places. Areas like materials, especially copper and mining related companies, energy and infrastructure, financials, select industrials and defense, and parts of the global market such as Japan, South Korea, and Latin America.

This is healthy. Markets that depend on just a handful of stocks are fragile. Markets where leadership is spreading out tend to be more durable.

The reflation backdrop

AGF describes the current environment as reflationary. That means growth is improving, inflation is not disappearing, and investment and capital spending are picking up.

Historically, this kind of environment tends to favour materials, energy, financials, and select industrial and semiconductor companies. We are already seeing early cycle areas like transports, housing, regional banks, and small caps start to participate more.

What about risks

A few are worth watching. U.S. debt and deficits could push yields higher over time. Geopolitical flare ups, especially involving Iran, could temporarily increase volatility and energy prices. Big tech may go through a period of digestion as massive spending on AI infrastructure has reduced free cash flow and buyback capacity for some of the largest companies.

That said, the view from AGF is that markets are still being driven primarily by earnings and fundamentals, not just headlines.

Gold, crypto, and real assets

One interesting shift is that while crypto was once seen as a hedge against currency debasement, gold has been the real beneficiary recently. Central banks have been increasing their gold allocations, and investor flows have favoured real assets in this phase of uncertainty.

What this means for you

Markets will always give us something new to worry about. Headlines change, narratives shift, and there is never a shortage of reasons to feel uneasy. What matters much more is having a plan that is built to handle different environments and sticking with it through the noise.

Conversations like these with managers such as AGF are part of how we stay thoughtful and disciplined about your portfolio. We are not trying to guess the next headline or jump in and out of markets. We are focused on building portfolios that are diversified, resilient, and aligned with your goals, whether markets are calm or choppy.

Periods like this, when leadership in the market is broadening and opportunities are showing up in more places, are exactly when good diversification and good planning quietly do their job.

If you ever have questions about how your portfolio is positioned or how this kind of market environment fits into your longer term plan, that is a conversation I am always happy to have.

Source: https://www.agf.com/ca/

Client Success Story

Wed, 21 Jan 2026 21:05:53 GMT

Complexity to Confidence

I first met this family in 2021 after they were referred to me by longtime clients.

They were a blended family, getting closer to retirement, and navigating a period of significant change. For many years, they had owned rental properties. It had been a successful strategy, but they were ready to move on. Being a landlord had started to feel less like an investment strategy and more like a second job — one they were happy to resign from. Their financial picture had a few layers.

She had a pension and a long, steady employment history. He owned his own business, which meant income varied from year to year and there was no pension waiting at the finish line. They also had RRSPs and other investments scattered across different institutions, most of them set up through the banks over time with very little coordination or advice beyond “you should probably have an RRSP.”

They weren’t doing anything wrong.

They just didn’t have a clear picture. Add in adult children, an aging parent, health considerations, and a strong preference for enjoying art, music, and travel, and it was clear they needed simplicity, flexibility, and reassurance — not more accounts.

Where we focused: We started by organizing and simplifying.

That meant:

• Consolidating investments so everything could finally be seen in one place

• Reviewing and restructuring existing RRSPs to better support retirement income

• Coordinating pensions, registered, and non-registered accounts

• Building a tax-efficient strategy as they transitioned out of real estate

• Creating a clear retirement income plan they could actually understand

Consolidation turned out to be more powerful than they expected. It reduced unnecessary costs, improved overall portfolio performance, and made decision-making much easier. It’s amazing how much better things feel when you don’t need a spreadsheet (or three passwords) just to see where your money is. Tax planning was a major part of the process as well. We looked carefully at how and when to draw income, how to reduce unnecessary tax, and how to balance income between them in a way that worked both now and over time.

The Hardest Part:

Learning to Spend One of the most common challenges I see with thoughtful, responsible people isn’t saving — it’s spending. We ran their retirement projections many times. We tested different market scenarios, spending levels, and longevity assumptions. And each time, the result was reassuring: they could spend more and still be on solid footing.

Still, seeing the math once is rarely enough. So we walked through it again. And again.

Eventually, the numbers stopped feeling abstract and started to feel believable — which is often the real turning point.

“The hardest part of retirement planning isn’t saving enough — it’s feeling confident enough to spend.”

Where They Are Now?

She officially retired in November 2025. Since then, they’ve been travelling, enjoying a slower pace, and feeling far more confident about their financial future. What once felt uncertain now feels manageable — and even enjoyable. That shift, from quiet worry to calm confidence, is one of the most rewarding parts of this work.

Why I’m Sharing This:

This relationship began with a referral, and that’s how most of our practice grows. When someone introduces a friend, colleague, or family member to us, it’s usually because they value a thoughtful, steady approach — one that includes organization, tax planning, and ongoing guidance, not just investment selection.

We don’t aim to work with everyone. We aim to work well with the people we do serve. If you’ve ever referred someone to us, thank you. That trust means a great deal. And if someone comes to mind — perhaps someone approaching retirement, running their own business, juggling multiple accounts, or quietly wondering whether they’re truly on track — we’re always happy to have a conversation.

Even one meeting can bring clarity, confidence, and sometimes a much-needed sigh of relief.

That’s how this work grows: thoughtfully, steadily, and one relationship at a time.

Laura

Market Update January

Wed, 21 Jan 2026 21:05:51 GMT

Steady Ground, Selective Opportunities

After a strong 2025 and a positive start to 2026, markets are entering a year that feels more balanced than dramatic . The backdrop remains supportive, but this is a time for thoughtful positioning rather than reacting to every headline.

We are now several years into a bull market that began after the 2022 pullback.

What’s notable is that this cycle has continued without a recession, despite several years of higher interest rates. Inflation has eased, growth has held up, and markets have had time to adjust.

That’s a healthy environment — but it also means markets are no longer “cheap.”

The Economic Picture: Supportive, with Some Bumps Along the Way

The economy continues to show resilience. Unemployment in the U.S. is near levels last seen in the early 1970s , which helps explain why consumer spending has remained surprisingly steady, even after a period of higher borrowing costs.

Inflation has cooled from its peak, taking pressure off both households and businesses. Interest rates are no longer rising quickly, and while they may move around over time, we appear to be past the most difficult phase of rate increases.

That said, we should expect ongoing volatility . Political headlines, global tensions, and unexpected announcements can move markets quickly — sometimes with little warning. President Trump, in particular, is known for embracing disruption and uncertainty, and markets do not love surprises. We may continue to see short-term pullbacks tied to headlines rather than fundamentals.

For investors, this is an important reminder: markets can be noisy in the short term , but over time they tend to be driven by earnings, economic growth, and business fundamentals.

Periods of volatility are uncomfortable, but they are also normal — and often reward investors who stay patient and focused on the bigger picture.

Stocks: Still Attractive, Just More Selective

Stocks remain an important part of portfolios in 2026, especially compared to sitting in cash. However, expectations should be more realistic than they were in recent years.

One reason many portfolio managers remain optimistic over the next few years — even while acknowledging short-term uncertainty — is that several supportive forces are lining up at the same time. No one can predict what markets will do over the next three to six months, but over a one-to-three-year horizon, the picture remains constructive.

Economic growth is still happening, inflation has come down, and interest rates are no longer moving higher at the pace we saw earlier in the cycle. Consumers continue to spend, the labour market remains healthy, and there is still a significant amount of cash sitting on the sidelines that could gradually move back into markets as confidence improves.

In addition, policies such as tax cuts and business incentives tend to support both consumer spending and corporate investment. Taken together, this backdrop supports a continued bias toward growth assets like stocks, while still being thoughtful about risk.

Looking further ahead, improvements in productivity — including the practical use of AI — could meaningfully improve efficiency and profitability across many industries. Importantly, this doesn’t necessarily mean widespread job losses, but rather smarter use of labour and technology. That combination helps support longer-term earnings growth, even if markets don’t move in a straight line.

That said, U.S. stocks are more expensive than they were earlier in the cycle. This doesn’t mean avoiding them, but it does suggest returns will depend more on which companies you own , rather than simply being in the market.

Outside the U.S., there are attractive opportunities as well. Canada, Europe, and certain international markets offer diversification and, in some cases, more reasonable valuations. Spreading exposure across regions continues to be an important way to manage risk.

Bonds: Back to Their Supporting Role

Bonds are once again doing what they’re meant to do: providing stability and income. Return expectations are more modest, likely in the low-to-mid single digits, but bonds still play an important role in smoothing out portfolio ups and downs.

Rather than relying on bonds for growth, many portfolios are structured so bonds act as a stabilizer while other areas do more of the heavy lifting.

Alternatives: A Helpful Diversifier

One theme we continue to see is the growing use of alternatives — such as market-neutral strategies, infrastructure, or select private investments — to improve diversification.

These investments are not meant to replace stocks or bonds, but they can help reduce volatility and provide additional sources of return, particularly when traditional asset classes move together. For most investors, alternatives make sense as a small but meaningful complement to a diversified portfolio.

Technology and AI: Evolution, Not Euphoria

Artificial intelligence continues to change how businesses operate, but the investment opportunity is becoming more nuanced. Rather than everything hinging on a few well-known names, the benefits of AI are likely to spread across many industries through productivity and efficiency gains.

This environment tends to reward careful stock selection, rather than simply owning the most talked-about companies.

The Bottom Line for 2026

2026 looks like a year where balance and discipline matter more than bold predictions .

Markets are supported by solid fundamentals, but higher valuations, political uncertainty, and occasional volatility reinforce the importance of diversification. Staying invested, spreading risk thoughtfully, and keeping portfolios aligned with long-term goals remain the most reliable approach.

As always, the focus isn’t on timing markets or reacting to headlines — it’s on building portfolios that can support the life you’re planning for, through both calm and uncertain periods.

Source: www.bloomberg.com

A New Year Check-In

Wed, 21 Jan 2026 21:05:49 GMT

What’s On Your Mind Financially?

The start of a new year often brings a quiet moment of reflection. Not resolutions exactly — more a mental check-in.

For many professionals in their 50s and early 60s, the questions aren’t about chasing higher returns or making dramatic changes.

They’re about clarity, confidence, and having options .

If any of the thoughts below sound familiar, you’re not alone.

“Am I actually on track?”

You may have built meaningful savings, pensions, or equity over the years — but still wonder:

Do all the pieces really work together?
What does “on track” actually mean for me?
If something changed, would I be okay?

→ Question for you:
If you had to explain your financial plan in one sentence, could you?

→ What can we do to help you?
We can help pull everything together into a clear, simple picture — no jargon, just clarity.

Thinking differently about retirement

Retirement doesn’t look the same as it used to.

Maybe you want to slow down, not stop
Maybe you want the option to retire earlier — even if you don’t take it
Maybe you want flexibility, not a fixed date

→ To-do:
Ask yourself: If work looked different in 3–5 years, what would I want that to be?

→ What can we do to help you?
We can walk through different paths — full retirement, phased work, or consulting — so decisions feel thoughtful, not rushed.

Replacing pay cheques with income

At some point, the focus shifts from saving to spending.

Where will monthly income come from?
How steady will it be?
What happens if markets are volatile?

→ Question for you:
Do you know which parts of your income are reliable — and which depend on markets?

→ What can we do to help you?
We can help design income strategies that balance stability with flexibility, so cash flow feels predictable.

Feeling tired of market ups and downs

After living through multiple market cycles, many people say the same thing:
“I just don’t want to feel anxious every time markets move.”

→ To-do:
Notice how market headlines make you feel. Calm? Uneasy? Overwhelmed?

→ What can we do to help you?
We can structure portfolios in a way that makes market swings easier to live with — emotionally as well as financially.

Taxes — with less patience for inefficiency

As incomes peak and portfolios grow, unnecessary tax drag feels more frustrating.

Am I paying more tax than I need to?
Is my money coming from the right places?
Should I be doing something differently now, not later?

→ Question for you:
Do you feel confident why your income is structured the way it is?

→ What can we do to help you?
We can review your overall structure to help ensure your plan is as tax-efficient as possible.

Supporting parents and adult children

Many people find themselves quietly supporting both generations.

Helping aging parents
Supporting adult children
Wanting to be fair, while still protecting their own future

→ To-do:
Ask yourself: If someone needed help unexpectedly, do I know how it would affect my own plan?

→ What can we do to help you?
We can help think through these “what ifs” so generosity doesn’t come at the cost of security.

Wanting things organized — and simpler

At this stage, many people want fewer loose ends.

Clear beneficiaries
Updated documents
A plan that’s easy for others to step into if needed

→ Question for you:
If someone had to step in tomorrow, would things be clear for them?

→ What can we do to help you?
We can help bring organization and clarity across the full picture — not just investments.

A Gentle Invitation

If any of this resonated, it doesn’t mean something is wrong.
It usually means you’re at a point where good questions matter more than quick answers .

Whether you have:

One question you’ve been meaning to ask
A to-do you’ve been putting off
Or simply want a second set of eyes

We’re always happy to talk. Reach out anytime — even if it’s just to ask, “Is this something I should be thinking about?”

A short conversation can often bring a lot of peace of mind.

Laura

Source: www.globeandmail.com

Mirror Wills: Simple on Paper, Not Always in Practice

Wed, 21 Jan 2026 21:05:44 GMT

Let's Take a Deeper Dive Into Mirror Wills

A lot of couples think they’ve wrapped up a major task when they use what’s called mirror wills.

On the surface it makes sense: each partner drafts a will that looks almost the same, usually leaving everything to the other, and then naming kids or others to inherit once the second spouse passes. It feels simple, satisfying and like a responsible step toward estate planning.

But here’s the thing — simple doesn’t always mean secure. Mirror wills can give people a false sense of certainty, because they aren’t tied together in any binding way. That means if one spouse dies, the survivor can change their will at any time. They could exclude beneficiaries, update how assets are divided or completely redo their estate plan with zero obligation to stick to what was originally agreed.

Let’s say a couple each has children from a previous relationship. They sign mirror wills and think everything is settled. If the surviving spouse later remarries or enters a new relationship and updates their will, kids from the first marriage could be left out entirely — even if that wasn’t anyone’s intention originally.

And it gets trickier. Lots of assets — like registered accounts (RRSPs, RRIFs, TFSAs) and property held in joint tenancy — bypass the will entirely when they’re passed on. That can result in assets flowing in ways that don’t match what’s in either will, creating unexpected tax bills or family conflict.

Some planners suggest mutual wills as an alternative. These are agreements where spouses promise not to revoke or change their wills after one partner dies. That sounds tighter, but it can also cause its own headaches if circumstances change — like new tax rules, health needs or financial shifts.

The bottom line?

Mirror wills might look neat and tidy, but they’re not a substitute for thoughtful, customized estate planning. Especially when blended families, joint assets or significant investments are in play, it’s worth digging deeper and designing a plan that really protects everyone’s interests.

Source: https://www.investmentexecutive.com/

2025 Year End Checklist

Fri, 12 Dec 2025 21:26:57 GMT

2025 Year End Checklist

As we approach the end of 2025, now is a great time to revisit your tax planning and make sure everything is in order before December 31. A few small steps taken now can help you stay organized, avoid surprises at tax time, and make the most of the credits, deductions, and opportunities available to you.

Our year-end checklist highlights the key items worth reviewing so you can head into 2026 feeling prepared.

Income Planning

Review salary vs. dividends for business owners to optimize tax, CPP, RRSP room, and BC Employer Health Tax.
Income splitting may be possible when family members provide reasonable services.

Updated Tax Rates & Credits

Top marginal tax rate remains 53.50% in BC.
Lowest federal tax bracket dropped to 14.5% for 2025 (started 2025 at 15% and decreased July 1) and 14% in 2026.
Dividend tax rates unchanged.

Lifetime Capital Gains Exemption

Increased to $1,250,000 for qualified small business shares and farm/fishing property.

Principal Residence Rules

Only one property per family can be designated each year.
“Plus-one” rule only applies if you were a Canadian resident in the year the property was acquired.
All sales must be reported on your tax return (Schedule 3 + Form T2091).
Penalties apply for late designations.

Anti-Flipping Rules

Federal rule: properties held less than 365 days may be taxed as business income.
BC’s new flipping tax (2025+): applies to properties held less than 730 days, with potential combined rates up to 73.5%.
Exceptions exist but are complex review before selling.

Trusts & TOSI

Trust income not paid to beneficiaries by Dec. 31 is taxed at the top rate.
Expanded Tax on Split Income (TOSI) rules apply to many adults receiving income not aligned with their contribution to a business.

Capital Loss Planning

You can realize losses to offset capital gains.
Final trade date for most securities: Dec 30, 2025.
Must wait 30 days before repurchasing to avoid superficial loss rules.
Losses cannot be triggered by transferring investments into RRSPs or TFSAs.
Unused losses can be carried back 3 years or forward indefinitely.

RRSP Planning

Last day to contribute for 2025 deduction: March 2, 2026.
2025 contribution limit: 18% of 2024 earned income, up to $32,490.
If you turn 71 in 2025, you must wind up your RRSP by Dec 31.
Spousal RRSP contributions offer income-splitting benefits.

TFSA

2025 and 2026 contribution limit: $7,000.
Lifetime limit for someone who’s never contributed: $102,000 as of 2025.
Over-contributions are subject to a 1% per month penalty.

First Home Savings Account (FHSA)

Annual limit: $8,000; lifetime max: $40,000.
Contribution room starts only once the account is opened—consider opening before Dec 31, 2025.
Contributions are deductible; withdrawals for qualifying home purchases are tax-free.

Other Registered Plans

RESP contributions earn 20% CESG, up to $500–$1,000/year.
RDSPs offer grants up to $3,500/year for eligible beneficiaries.

Additional Planning Tips

Defer bonuses to January 2026 if helpful for tax planning.
Review interest deductibility and consider restructuring loans used for investment.
Investment counseling fees for non-registered accounts may be deductible.
Keep accurate automobile logs to optimize taxable benefit reporting.
Buying business assets before year-end may accelerate deductions.

Credits & Deductions

Charitable donations must be made by Dec 31.
Childcare expenses, medical expenses, adoption expenses, and moving costs may be deductible.
Home Accessibility Tax Credit allows claims up to $20,000 of eligible expenses.
Educator supplies credit remains available for teachers/ECEs.

Families & Benefit Programs

File tax returns for all family members to maintain eligibility for:
Tax-Free Savings Account room
Canada Child Benefit
BC Family Benefit
GST credit
RRSP contribution room
RDSP (if eligible)

Foreign Property Reporting

Form T1135 required if you hold more than $100,000 in specified foreign property.
Enhanced reporting for holdings over $250,000.

U.S. Citizens in Canada

Must file U.S. tax returns on worldwide income.
Returns due April 15, 2026, with automatic extension to June 15 (taxes still due April 15).

source: www.canada.ca

2025 in Review & What We’re Watching for 2026

Fri, 12 Dec 2025 21:26:55 GMT

A Year of Transition, Tailwinds, and a Few Surprises

As we look back on 2025 (remember Liberation Day?), it’s clear the economic story—both in Canada and the U.S.—was anything but boring. We had uneven momentum, shifting inflation, changing expectations about work, and more geopolitics than anyone asked for.

And, as always, while economic predictions are useful, they’re also famously wrong—so we take them with a healthy grain of salt and plan thoughtfully with the information we have.

Here’s a quick look at what happened this year and what may be unfolding as we head into 2026.

Canada’s 2025 Economic Landscape~

Progress, With a Few Detours: The Canadian economy did move ahead this year just not in a perfectly straight line. Growth & Inflation Trends

We saw better-than-expected growth early on, but different sectors told different stories:

Energy and gold were the standouts (no surprise there).
Manufacturing and housing continued to lag.
Headline inflation eased to about 2.2%, although it certainly didn’t feel like it in the grocery store.

Several structural pressures stuck around:

Rents kept climbing—up 5.2%—even with slower immigration.
Food inflation felt noticeably higher thanks to shrinkflation (you’re not imagining the smaller packages!).
Energy costs dropped after the rollback of the carbon tax

Labour Market Dynamics: Unemployment sat near 7%—higher, but not recession-level.

A few themes shaped the workforce:

Youth unemployment stayed higher as expectations around work continue to shift.
Newcomers had slower job absorption as hiring cooled.
And yes, a bit of “affluenza”—some younger adults being more selective or slower to enter the workforce.

Currency, Markets & Sector Leaders: Despite mixed economic data, markets performed better than expected:

The Canadian dollar strengthened a little against the USD.
The TSX outperformed, driven by:
High-flying gold stocks
Solid energy
More stable financials as rate expectations shifted

Canada vs. the U.S.: Two Similar Stories With Different Plots~

United States: The U.S. started strong but lost momentum:

Growth slowed into the second half of the year.
Job creation cooled to around 64,000 per month.
Inflation drifted back toward 3%.
Political uncertainty and trade tensions weighed on investment.
Market valuations softened.

Canada: Closer to home:

Growth was softer at 1.4%.
Inflation moved in a similar range to the U.S.
The labour market was more fragile.
Our commodity sectors (energy, gold, materials) helped keep things steadier than they might otherwise have been.

Overall: Canada leaned on its resource strength; the U.S. leaned into political unpredictability.

Interest Rates, Bonds & What the Yield Curve Is Telling Us : One of the clearest signals this year came from the bond market.

Yield Curve Insights: Canada’s steepened yield curve suggested:

Short-term rates are probably done falling.
Longer-term rates may stay higher due to persistent inflation pressures.
Government deficits are keeping upward pressure on borrowing costs.

Bond Market Outlook: Looking ahead ~

Canadian bond returns should look better in 2026.
Short-term GICs remain attractive for safety-focused investors.
Bonds will continue to be a useful buffer if equity markets wobble.

Trade Policy & Canada’s Vulnerabilities: A recurring theme this year was Canada’s delicate positioning when the U.S. adjusts its trade policies.

Even well-intentioned policies designed to stimulate the U.S. economy can create challenges for us because:

We are more reliant on trade.
Our market is much smaller.
Our supply chains are deeply intertwined.
We simply have less bargaining power.

The good news: Canada is actively pursuing more partnerships with other countries, which may help reduce some of this dependency over time.

Global Markets, Volatility & What Might Shape 2026 Returns ~

2025 reminded us that markets are global whether we like it or not. Market Valuations & Volatility

This year we saw :

High geopolitical volatility
Reasonable valuations here in Canada
Lower valuations in the U.S. as uncertainty grew
Uneven performance in emerging markets

And yes—gold continued to shine as a hedge against both currency risk and global instability.

Key Global Flashpoints: Notable risks for 2026 include:

Continued tensions in the Middle East
Concerns about extremist influences in Western institutions
A slow but noticeable erosion of traditional geopolitical stability

These factors mean volatility isn’t going anywhere—but they also tend to create opportunities for long-term investors.

2026 Outlook: Canada & the United States: Canada: Slow but Steady - Canada’s 2026 forecast points to:

Growth between 1–1.5%
Easing rent inflation as immigration normalizes
A possible Bank of Canada rate cut in the second half of the year
Continued strength in energy and mining
A gently stronger Canadian dollar

United States: More Clouds on the Horizon the U.S. may face:

Higher recession risk
Slowing job creation
Sticky inflation around 2.5–3%
Elevated political volatility heading into midterms
Certain sectors still benefiting from corporate tax incentives

Expected Market Returns for 2026: Our working estimates:

U.S. equities: 4–7%
Canadian equities: 6–8%
Global equities: 6–10%

These reflect a world that’s normalizing but still full of political surprises.

What This Means for Investors: Despite the headlines, 2026 has the potential to be a year of resilient opportunity:

Valuations are more reasonable than a year ago.
Bonds are finally positioned to contribute again.
Canada’s resource strength remains a stabilizing force.
Diversification—geographic and sector—is still the strongest strategy

We expect moderate returns, gradually easing inflation, and selective opportunities, especially for long-term investors who stay invested and stay disciplined.

If you’d like a personalized discussion about how any of this affects your retirement planning or investment strategy, I’m always happy to chat.

Source: Bloomberg

Is AI Creating a Tech Bubble?

Fri, 12 Dec 2025 21:26:54 GMT

AI Boom or Bubble? Why Today’s Market Looks Different from the Dot-Com Era

The surge in artificial intelligence (AI) has pushed tech stocks sharply higher, leading many to wonder whether we’re in another “dot-com style” bubble.

We believe the comparison is overstated. Here’s a simple breakdown.

Why Some People Worry About a Bubble

1. A handful of tech giants dominate the market

Tech companies now make up over a third of the S&P 500 — and more than half if you include tech-related names like Amazon, Meta and major payment companies. When a small group drives most returns, the market can feel narrow and vulnerable.

2. Valuations are high

The S&P 500 is trading near the top of its 20-year valuation range, meaning expectations are very optimistic. High valuations don’t predict a crash, but they can make markets more sensitive to disappointing news.

3. Big, interconnected partnership deals

Some recent AI-related partnerships involve massive sums of money circulating within the same ecosystem. This creates questions about whether all the demand is real or partly “self-funded.”

Why This Isn’t the Dot-Com Bubble

1. Today’s tech leaders have real profits

In the 1990s, many companies had big promises but no earnings. Today, major AI leaders (Microsoft, Apple, Google, Meta, Amazon, Nvidia) are producing huge profits — their earnings have grow n 127% sin ce this bull market began.

2. Businesses are actually using AI

AI is being adopted across healthcare, mining, research, manufacturing, and every major industry — not just by consumers playing with apps. This is driving real, broad-based demand.

3. AI spending continues to accelerate

The largest tech companies are projected to spend $460 billion on AI-related infrastructure in 2026 — a major driver of economic growth. Unlike the 1990s, these companies have the cash to fund these investments.

4. More diversified business models

Big tech companies aren’t dependent on one product or idea. They generate revenue from hardware, software, cloud computing, advertising, streaming, and more — which adds resilience.

Bottom Line

A pullback is possible — and normal — given how fast markets have moved. But we believe the long-term AI story is structural, not speculative.

The fundamentals behind today’s leaders look far stronger than those during the dot-com era, and the demand for AI continues to grow.

Source: globeandmail.ca

Retirement Planning: Discovering “Hidden” Pensions for Canadian Clients

Fri, 12 Dec 2025 21:26:52 GMT

You may be closer to extra retirement income than you think.

Discovering “Hidden” Pensions for Canadian Clients

Recently, a few of our long-time clients were pleasantly surprised to learn they qualified for U.S. Social Security and the U.K. State Pension—even though they’ve lived in Canada for decades.

It sparked a great question:

Are there other countries where Canadians or long-time immigrants to Canada may also qualify for foreign pensions?

The answer: Absolutely.

And sometimes those pensions add several thousand dollars a year in unexpected income.

Why This Happens

Canada has Social Security / Pension Totalization Agreements with a number of countries. These allow people to combine contribution years from Canada with contribution years from another country.

Even a short period of work abroad—sometimes as little as one year—can unlock access to a foreign pension.

This is exactly how our clients recently unlocked benefits from the U.S. and U.K.

Countries Where Canadians May Qualify for a Pension:

Europe:

Germany • France • Italy • Netherlands • Sweden • Norway • Finland • Denmark • Austria • Portugal • Spain • Greece • Czech Republic • Slovakia • Hungary • Poland • Romania • Luxembourg • Switzerland

Asia / Middle East:

Japan • South Korea • Turkey • Israel

Latin America / Caribbean:

Mexico • Brazil • Chile • Peru • Dominican Republic • Barbados

Oceania:

Australia • New Zealand

Other:

Philippines • Trinidad & Tobago

Benefits for Clients

Identifying foreign pension eligibility can offer several advantages:

1. Additional Retirement Income

A small pension from overseas can provide meaningful monthly income, especially when added to CPP/OAS.

2. Reduced Risk of Leaving Money Unclaimed

Many people don’t realize they paid into foreign systems during early career years or working holidays.

3. Better Retirement Planning Clarity

Knowing about all sources of income helps create smoother, more accurate cash-flow projections.

4. Possible Ability to “Top Up” Benefits

Some systems—such as the U.K.—allow voluntary top-ups to significantly increase future payments.

5. Survivor Benefits

In certain countries, spouses may also receive benefits, even if they never lived or worked there.

6. Coordination With Canadian Rules

These pensions do not reduce CPP, although they may affect GIS (for low-income seniors). Understanding them helps clients avoid surprises.

Countries Without a Treaty

These common immigrant origins do not currently have an agreement in force:
India (signed but not yet active) • China • Hong Kong • Thailand • Vietnam • Iran • Pakistan

Clients may still have rights in those countries—but cannot combine CPP credits to qualify.

Next Steps

If you or a family member worked abroad—even briefly—here’s how to start:

1. Make a list of any countries where you worked or contributed to payroll taxes

Even part-time or student work can count.

2. Check whether that country has a Social Security Agreement with Canada

We can help you confirm this.

3. Request contribution statements

Each country has a different process; we can guide you through it.

4. Add potential benefits into your retirement plan

We will incorporate these figures into your projections once statements arrive.

5. Consider timing and taxation

Some pensions have withholding tax or affect GIS; we help review the implications.

Want Me to Check Your Eligibility?

If you’ve ever worked abroad—or know someone who has—feel free to reach out. We can help determine if there’s a foreign pension waiting for you, even decades later.

Source: https://www.canada.ca/en/revenue-agency/services/tax

November Market Update

Thu, 13 Nov 2025 23:23:20 GMT

Markets in November: Key Trends and Takeaways

1. The Canadian Economy — Slow and Steady, but Feeling the Trade War Headwinds

Canada continues to move along at a slow but steady pace. Inflation is easing, rates are drifting lower, and the economy has avoided recession — the classic soft landing.

The “slow and steady” foundation:

Inflation is near the Bank of Canada’s 2% target, with core inflation around 2.5%.
The Bank of Canada cut rates twice this fall — to 2.50% on September 17, and again to 2.25% on October 29, 2025.
Policymakers have signaled they’re willing to “look through” short-term inflation bumps to support growth.
Canada’s 2025 GDP is expected to grow around 1–1.5%, which is modest but reassuringly stable.

But trade-war pressures are slowing things down:

Canada remains heavily integrated with the U.S., and the ongoing trade conflict is creating real economic friction.

About 75% of Canadian exports go to the U.S., representing almost one-quarter of our total GDP.
Tariffs and policy uncertainty have led companies to report:
• higher costs,
• lower profits,
• supply-chain disruptions, and
• delayed investment.
Long-term estimates suggest the trade war could reduce Canada’s GDP by 1.25%–2% if conditions persist.
The Bank of Canada has noted that weaker exports and softer labour-market conditions are already contributing to slower economic momentum.

What this means for you:

Canada is still stable, but we are growing more slowly than we otherwise would.
Export-linked sectors (autos, manufacturing, agriculture, energy) may feel pressure.
This is a strong reminder of the importance of global diversification — not being overly tied to an economy that is facing external headwinds.

2. Ottawa’s 2025 Federal Budget — “Building Canada Strong”

The November 4 federal budget emphasizes long-term stability over short-term stimulus.

Highlights:

A new capital-budgeting framework separating long-term infrastructure investments from operating spending.
Additional spending on housing, transportation, productivity, and defense.
A focus on innovation, efficiency gains, and trade resilience.

For investors, this means fewer surprises — Canada remains on a predictable fiscal path without major tax disruptions.

3. Stocks — A Tug of War Between Optimism and Caution

This fall, the stock market is being pulled between two compelling but opposing forces:

On the optimistic side:

Corporate earnings have been stronger than expected.
AI innovation continues to boost confidence around long-term productivity gains.
Lower interest rates give valuations some support.

On the cautious side:

Stock markets are near record highs.
Economic growth — in Canada and globally — is slowing.
High valuations leave less room for disappointment if earnings soften.

What this means for your investing strategy:

Stay invested for long-term growth, but stay quality-focused: companies with strong balance sheets, real earnings, and reliable dividends.
Diversify globally to limit reliance on any one sector or region.
Expect volatility — and use it as a chance to rebalance, not react emotionally.

4. Bonds — Quietly Becoming Attractive Again

After years of uncertainty, bonds are finally offering value again:

The 10-year Government of Canada yield is near 3%.
Falling policy rates are improving bond price stability.
Bonds once again contribute income + stability — particularly helpful for retirees or those close to retirement.

We continue to use fixed income as well as alternative investments to balance opportunity and risk.

5. What We’re Watching into 2026

Inflation: Any sustained move above 3% could slow or reverse rate cuts.
Global growth: Slower demand abroad affects Canadian exports.
Valuations: Certain sectors, especially tech, remain expensive.
Currency: A softer Canadian dollar boosts global investment returns.

6. The Right Direction Approach

Our guidance remains consistent:

Diversify intelligently — Canada + global + fixed income + alternatives where appropriate.
Rebalance regularly — lock in gains and manage risk.
Plan around life events: retirement income, downsizing, supporting parents and adult children, estate planning.
Avoid knee-jerk decisions — markets reward discipline, not emotion.

In Summary

Markets today sit at a delicate balance:

Optimism from strong earnings and long-term AI potential,
Caution from slowing economies and record-high valuations,
Stability from lower inflation and falling interest rates,
But pressure from the ongoing trade war with the U.S.

For thoughtful investors, this is a time to stay steady, diversified, and goal-focused — not too cautious, not too aggressive.

Here’s how the numbers look at Nov 12, 2025:

Sources:

YCharts.com

globeandmail.com

AI Investing in 2025: Exciting — but Keep Your Eyes Open

Thu, 13 Nov 2025 22:53:37 GMT

The AI Boom: What It Means for Your Portfolio

There’s no question about it — AI is the hottest topic in investing right now.

From chip makers to cloud providers, almost every company is trying to position itself as part of the AI revolution. The buzz is real… but so are the risks.

AI investments are booming — global spending on generative AI topped US $33 billion last year, and i t’s still climbing. But not every AI project turns to gold. Some fizzle out due to high costs, poor data, or no clear path to profits. The real challenge for investors? Figuring out which companies are using AI to genuinely improve productivity — and which are just adding “AI” to their marketing.

Where the Opportunities Are

Behind-the-scenes players — chipmakers, data centers, and infrastructure companies that make AI possible.
Software and automation — tools that actually help businesses save time and money.
Everyday adopters — healthcare, logistics, and financial firms using AI to get smarter and more efficient.

What to Watch Out For

Too much excitement in too few stocks. A small group of tech giants has driven most of the gains.
Valuations that assume perfection. Some prices look more like hope than math.
Regulatory speed bumps. Governments are still figuring out how to oversee AI responsibly.

Smart Investor Moves

Mix broad exposure with a few targeted “AI satellite” positions.
Focus on companies with real earnings and solid balance sheets.
Keep global diversification — Canada, the U.S., and abroad — to balance opportunity and risk.

Bottom line: AI will shape the next decade, but staying diversified and disciplined is still the best way to benefit from innovation without betting it all on the next big trend.

Source: bloomberg.com

Your Guide to Budget 2025: The Updates That Matter Most

Thu, 13 Nov 2025 22:53:03 GMT

Budget 2025 is more about tightening rules and cleaning up legislation than making major tax shifts.

Trusts & Estate Planning:

21-Year Rule – What It Means

Every 21 years, a personal trust is treated as if it sold its investments — which can trigger tax.
Families often avoid this by transferring assets out of the trust to beneficiaries on a tax-deferred basis.
The government is tightening rules to stop indirect transfers that try to reset the 21-year clock.
These expanded rules apply to transfers made on or after November 4, 2025.

Life Insurance and Trusts

Life insurance is not affected by the 21-year rule.
It can also help provide cash to pay taxes when trust assets eventually pass to the next generation.

Personal Tax Changes:

Personal Support Workers Tax Credit

New refundable credit for eligible personal support workers:
Worth 5% of eligible income, up to $1,100 per year.
Applies 2026–2030.
Not available in BC, Newfoundland & Labrador, or NWT, as these provinces already have wage-support agreements.

Top-Up Tax Credit

As tax rates on the first income bracket drop over the next two years, most non-refundable credits would become slightly less valuable.
This new Top-Up Credit ensures credits claimed above the first tax bracket keep their value at 15% (through 2030).

Automatic Tax Filing for Low-Income Canadians

CRA will be allowed to automatically file returns for individuals with very low incomes.
Before filing, CRA will send the person a summary and give them 90 days to confirm or update.
Designed to:
Increase access to benefits
Reduce the cost and burden of filing
Improve compliance
Begins for 2025 tax year (filing may occur in 2026).

Changes to Registered Plans (RRSP, TFSA, RESP, RDSP, FHSA, DPSP)

Simplified Rules for Small Business Investments

Effective January 1, 2027:

Rules will be streamlined so all plans follow the same framework.
RDSPs gain more investment flexibility.
Some older, more complicated investment structures will no longer qualify.

Registered Investment Regime Removed

As of January 1, 2027:

The old “registered investment” status is being eliminated.
New categories will allow most funds to continue qualifying without needing CRA registration.
This should simplify investment selection for Canadians.

Other Notable Updates

Registered plan definitions consolidated and simplified.
Canadian Entrepreneurs Incentive has been officially cancelled.

Business Tax Measures:

Corporate Tax Deferral Rules Tightened

New rules aim to reduce tax deferral through intercorporate dividends when corporate year-ends don’t align.
Mostly affects corporate groups with investment income or holding companies.
Applies to taxation years starting after November 4, 2025.

Immediate Expensing for Manufacturing Buildings

Temporary 100% deduction for buildings used 90%+ for manufacturing or processing.
Applies to new buildings first used before 2030 (with reduced rates through 2033).

Real Estate & Sales Taxes:

Underused Housing Tax Eliminated

Eliminated starting 2025.
No filing or payment required for 2025 and onward.
Requirements still apply for 2022–2024.

Luxury Tax Updates

Luxury tax on aircraft and boats is eliminated immediately.
Luxury tax on automobiles remains.

What Was Not Included:

Budget 2025 did not introduce

A wealth tax
Changes to capital gains inclusion beyond what’s already announced
Corporate tax rate changes
Higher personal tax rates
RRIF minimum withdrawal changes

Big Picture Takeaway:

Budget 2025 is more about tightening rules and cleaning up legislation than making major tax shifts.

For most Canadians, the impact will be modest — but there are meaningful updates for families using trusts, business owners, and registered plan investors.

If you would like to know how any of these changes might affect your financial plan, we’re here to help.

Source: www.canada.ca

The Great Wealth Transfer

Tue, 21 Oct 2025 21:48:59 GMT

**The Great Wealth Transfer: How to Protect*, Preserve, and Pass On Your Legacy**

Over $1 Trillion Will Change Hands in Canada by 2030 — Are You Ready?

More than $1 trillion in assets is expected to transfer from Canadian baby boomers to their heirs by the end of this decade. This “Great Wealth Transfer” represents both tremendous opportunity and responsibility.

Without proper planning, inheritances can become complicated — leading to unnecessary taxes, delays, or even family disputes.

With the right strategies, though, your legacy can pass smoothly, efficiently, and in line with your wishes.

1. Make Your Wishes Clear

Updating your will is essential — but so is communicating your intentions.
Open family discussions help ensure everyone understands your wishes and reduce the risk of misunderstandings later on. “In my world, I often hear, ‘This is what Mom and Dad would have wanted.’ Why not just say it?”
— Ian Hull, Estate Lawyer, Hull & Hull LLP

Your financial advisor can help guide these conversations and coordinate with accountants and lawyers to ensure a cohesive plan.

Advice: Schedule a family meeting to discuss your estate intentions — before life forces the conversation.

2. Enable Quick Access to Assets

When the time comes, your loved ones shouldn’t have to wait months to access what you’ve built.
Tools such as segregated funds and life insurance policies allow beneficiaries to receive funds directly — often within 30 days — bypassing probate and estate delays.

These solutions can:

Provide immediate liquidity for taxes or bills
Avoid probate and legal fees
Offer peace of mind during an emotional time

“That 30-day cheque can be a game changer in almost every estate.” — John Natale, Head of Tax, Retirement & Estate Planning Services, Manulife Investments

3. Protect Your Estate — and Your Heirs

Segregated funds and life insurance don’t just speed up the process — they also protect your overall investment strategy. They can:

Shield assets from market downturns and estate costs
Provide flexibility and control
Support wealth preservation for future generations

Trusts can also help manage more complex estates — such as ensuring financial security for a spouse or controlling distributions to children over time.

“We want to help ensure a peace-of-mind approach to wealth transfer for all involved.” — John Natale, Head of Tax, Retirement & Estate Planning Services, Manulife Investments

The “Great Wealth Transfer” is already underway. Whether your estate is simple or complex, planning now can make all the difference later.

A clear, coordinated plan ensures your wealth — and your values — live on.

*Disclaimer: Insurance products and services are offered through Right Direction Financial, an independent and separate company from iA Private Wealth Inc. Only products and services offered through iA Private Wealth Inc. are covered by the Canadian Investor Protection Fund. Her insurance title is Insurance Advisor.

Source: www.globeandmail.com hre estate planning strategies every advisor should know - The Globe and Mail

October Markets: Resilient Returns, Cautious Optimism

Tue, 21 Oct 2025 21:32:03 GMT

Market Update October 2025 — Past Month & Year-to-Date

Equity markets continued to navigate a mix of economic crosscurrents over the past month, balancing progress on inflation against lingering uncertainty around interest rate policy and corporate earnings. Despite periods of volatility, global markets remain resilient, supported by steady consumer spending, corporate profitability, and cautious central bank guidance.

Canada: Playing It Steady

The Canadian market continued its steady climb this month. Banks and industrial companies helped lead the way, and energy stocks got a boost as oil prices stabilized. While our market doesn’t move as fast as the U.S., it remains a reliable source of dividends and long-term value —two things Canadian investors appreciate.

United States: Tech Still in the Driver’s Seat

The U.S. market pushed higher this month, supported once again by earnings from technology, healthcare, and industrial companies. Even with questions around future interest rate cuts, corporate profits have held up better than expected, and that has helped keep investors optimistic.

International Markets: Quiet but Positive

International markets continue to move forward— not flashy, but quietly contributing to diversification . Japan has been one of the stronger performers this year, while Europe is growing more cautiously. Long-term investors continue to benefit from having part of their investments outside North America.

Bonds: Calm After a Turbulent Year

After a challenging stretch in 2022–2023, bond markets have stabilized. Higher yields mean bonds are once again playing a valuable role in portfolios— providing income and helping reduce volatility when markets get choppy. As central banks look to cut rates gradually in 2025, bonds remain relevant again.

Looking Ahead

Market sentiment continues to be shaped by three primary themes:
1. Inflation progress – trending lower, but not yet at target
2. I nterest rate outlook – gradual easing expected by central banks around the world but timing remains uncertain
3. E arnings resilience – corporate results remain broadly supportive of equity markets

Short-term volatility is still possible as markets adjust to evolving economic data. However, the medium- and long-term outlook remains constructive , supported by strong innovation trends, improving productivity, and healthier-than-expected economic conditions in North America.

Final Thoughts

Periods of uncertainty reward disciplined investors. Staying diversified across asset classes, sectors, and geography remains essential. With interest rates expected to move lower over time, balanced portfolios are well-positioned , and cash sitting on the sidelines may face reinvestment risk if markets continue to advance.

Staying patient and disciplined remains the best strategy—especially as we look ahead to potential interest rate cuts, continued innovation globally, and improving market confidence.

How markets are doing (in Canadian dollars):

Sources are CAD total returns from ETF providers (BlackRock/Vanguard) and Yahoo Finance proxies as of Oct 10, 2025.

Top 10 Things Executors Should Know

Tue, 23 Sep 2025 22:13:08 GMT

Someone just asked if you’ll be their executor.

It may be considered an honor to be ask, but think it through first. It can be a lot of work!

1. You don’t have to say yes.
Being an executor is a big job. If you don’t feel able to take it on—due to time, distance, or personal reasons—it’s okay to decline.

2. You need the original will.
Make sure you know where the original signed will is kept. Without it, you can’t start your duties.

3. Probate may be required.
Probate is the court process that confirms your authority as executor. Whether it’s needed depends on the estate’s size and assets.

4. You must protect the estate right away.
This could mean securing the home, notifying banks, or cancelling credit cards to prevent fraud or misuse.

5. You are personally responsible.
As executor, you have a legal duty to act in the best interests of the estate and beneficiaries. If mistakes are made, you could be held liable.

6. Taxes are unavoidable.
You must file the deceased’s final tax return—and sometimes returns for the estate itself—before distributing assets.

7. Creditors come before beneficiaries.
Debts, taxes, and expenses must be paid before money or property is given to heirs.

8. Keep detailed records.
You’ll need to track all estate income, expenses, and distributions. Beneficiaries have the right to see this accounting.

9. You can (and should) get help.
Executors often hire lawyers, accountants, and financial advisors. Their fees are paid from the estate. And there are professional trust companies and lawyers that will be executors.

10. It takes time.

Even a simple estate can take months to settle; more complex ones can take years. Patience—and clear communication with beneficiaries—is essential.

Source: www.canada.ca

More Than Money: What Really Belongs in Your Retirement Plan

Mon, 22 Sep 2025 19:33:23 GMT

More Than Money: What Really Belongs in Your Retirement Plan

A solid retirement plan isn’t just about stashing money away. It’s about creating a roadmap for the life you want to live—making sure you’ve got the resources, health, and confidence to enjoy it.

1. Financial Security & Longevity

Plan for the long haul. These days, it’s smart to assume you’ll need income for 25–30 years. I usually plan for age 95, with inflation around 2.2%.
Mix it up. A well-diversified portfolio balances growth investments (to keep up with rising costs) with steady income sources (to cover your essentials). And we always plan with conservative returns—it’s better to be safe.
Income flow. Retirement often means going from one or two paycheques to several smaller income sources: RRSPs, TFSAs, pensions, CPP, OAS. Timing how you draw from each can make a big difference in both taxes and sustainability.

2. Health & Long-Term Care Planning

Budget for health. Provincial plans don’t cover everything—think dental, vision, prescriptions. These costs can climb quickly as you age.
Insurance* or savings. You may want critical illness coverage or simply set aside a dedicated fund to cover unexpected health needs.
Wellness matters. Staying active, eating well, and looking after your mobility now can help you stay independent and improve your quality of life later.

3. Family & Legacy Planning

Setting limits. Helping kids or grandkids is wonderful—but make sure it doesn’t put your own retirement at risk. I’ve seen parents overextend, and sometimes the reverse happens too.
Keep documents current. Wills, powers of attorney, beneficiary designations—these need to be kept up to date.
Talk it out. Honest family conversations around money, roles, and expectations can help avoid future conflict.

4. Lifestyle & Personal Fulfillment

Your vision. Where do you want to live? How do you want to spend your days? Having clarity here is key.
Stay connected. Build in ways to keep socially active—friends, clubs, volunteering, travel, whatever keeps you engaged.
Passions and play. Whether it’s golf, gardening, art, or travel, include the hobbies that make you happiest—and be realistic about what they’ll cost.

5. Knowledge & Decision-Making

Get support. Work with a financial professional who understands not just your numbers, but your values and goals.
Keep learning. Staying on top of tax changes, investments, and retirement rules gives you more control.
Review regularly. Life changes—your plan should too. Revisit it at least once a year.

Bottom line:
A good retirement plan gives you clarity, confidence, and flexibility. Covering these key areas will help you feel prepared—and let you focus on enjoying the next chapter with peace of mind.

Source:moneysense.ca

Disclaimer: Insurance products and services are offered through Right Direction Financial, an independent and separate company from iA Private Wealth Inc. Only products and services offered through iA Private Wealth Inc. are covered by the Canadian Investor Protection Fund. Her insurance title is Insurance Advisor

The Power of Compound Interest: Turning Small Investments into Big Wealth

Mon, 22 Sep 2025 19:33:21 GMT

The Beauty of Compound Interest: Turning Small Investments into Big Wealth Over Time

When it comes to building real wealth, there’s one strategy that consistently stands out: compound interest. It’s often called the “eighth wonder of the world,” and for good reason. With time, consistency, and patience, compound interest can turn even modest investments into something extraordinary.

What Is Compound Interest?

Compound interest is interest earned on both the money you put in (the principal) and the interest that’s already been added. In simple terms, it’s “interest on interest.” Unlike simple interest, which only grows on the original investment, compounding snowballs your growth as the years go by.

How It Works in Real Life

Let’s look at an example:

You invest $7,000 per year (about $583/month).
Assume an average 8% annual return.

Here’s what happens:

After 10 years, your investment grows to over $109,000.
After 20 years, it grows to $345,000.
By 40 years, your total is nearly $2 million.

That’s right—you would have contributed just $280,000 out of pocket, but thanks to compounding, your money grows to $1.95 million. That’s an extra $1.6 million earned purely through growth.

Trying to save that much without investing? It would take over 240 years.

Why Compounding Is So Powerful

In the early years, compounding feels small—your first $7,000 investment might earn just $560 in growth. But stick with it. By year 20, your money is generating over $200,000 in returns. By then, your dollars are doing the heavy lifting while you go about your daily life.

I s 8% Realistic?

An 8% return might sound optimistic, but historically, markets have averaged around this number over the long run. Of course, returns fluctuate—some years are up, some are down—but for patient investors who stay the course, the math works out in their favor. Even at 4% your money could possibly grow to $691,000 or at 6% $1,148,000.

The Takeaway

Compound interest is proof that time in the market beats timing the market. The earlier you start and the more consistent you are, the greater your results will be.

You don’t need to be a financial expert to take advantage of compounding—you just need discipline, patience, and a commitment to keep investing, even when progress feels slow.

Source: Leandra Peters: #femaleinfinance/Instagram

September Market Update

Mon, 22 Sep 2025 19:33:19 GMT

Stock Market Update for September

Year to date the stock markets have been doing well.

Here’s a quick summary:

TSX (Canada):

The TSX has been setting new record highs .
Year-to-date, it’s up around 19-20% , outperforming many U.S. indices.
One big contribution has been interest rate easing : the Bank of Canada has cut its policy rate to 2.5%, the lowest in about three years. That tends to help sectors with debt or growth, as borrowing costs drop.

S&P 500 (U.S.):

The S&P 500 (and other U.S. indexes) have also hit record highs recently, helped by a Fed interest rate cut that happened this week and optimism that more cuts may follow.
Gains are being led by technology / semiconductors and some of the large-cap names, including companies connected to artificial intelligence and other growth areas.

Europe:

European shares are more mixed, but there are positive signs. For example, banks and defense stocks have done relatively well.
Valuations in Europe are generally lower than in the U.S., which makes them look more attractive for some investors.
Some stimulus and fiscal easing (especially in big economies like Germany) are helping.

What to watch / risks:

Valuations look stretched i n many markets (especially in the U.S.). People are increasingly concerned that stock prices are pricing in “perfect” outcomes (low inflation, solid growth, minimal shocks). If any of those expectations are disappointed, there could be pullback risk.
Economic slowdown signs are creeping in: labor markets showing some softness with unemployment creeping up; inflation although moderating, still somewhat elevated in many places.
Interest rate policy remains a double-edged sword. Rate cuts are boosting markets, but if inflation flares up again, central banks may need to hold or even raise rates, which could hurt sectors sensitive to rates.
Geopolitical / external risks : trade tensions, currency fluctuations (e.g. euro vs. dollar), energy price risks, and debt burdens in some European countries remain concerns.

Bottom line:

Overall, the outlook is cautiously optimistic . The markets are being supported by:

lower borrowing costs,
solid gains in growth/tech sectors,
attractive valuations (especially in some European stocks), and
decent economic momentum in many regions.

But there is a fair amount of risk: high expectations are built into prices, and if something like inflation, a trade conflict, or a policy misstep catches investors off guard, there could be volatility.

Let me know if you have any questions.

Source: Bloomberg.ca

Private VS Public Investments: Same Destination, Different Roads

Fri, 15 Aug 2025 18:14:22 GMT

Highway or Scenic Route? How Public and Private Investments Take You to the Same Goal

Private vs. Public Investments: Same Destination, Different Roads

When it comes to building a strong investment portfolio, you’ve probably heard about public investments (the familiar stocks, bonds, ETFs) and maybe more recently, private investments.

Private investments — used extensively by large pension funds — include private equity, real estate projects, and private debt. We use both in our clients’ portfolios because they serve different purposes.

Think of it like travel:

Public investments are like the main highway — open to everyone, easy to get on and off.
Private investments are more like a scenic back road — often with more rewarding views, but you’re committing to the ride.

Let’s break it down.

1. Public Investments — The Open Highway

Public investments are traded on well-known exchanges like the TSX, NYSE, or NASDAQ.

Examples:

Stocks — a small ownership piece of a company.
Bonds — you lend money to governments or corporations, and they (hopefully) return it with interest.
ETFs & Mutual Funds — bundles of investments for instant diversification.

Pros:

Easy access — buy or sell in a day, like online shopping (without the late-night impulse buys).
Transparent pricing — you can check prices anytime (though it’s healthier not to check 87 times a day).
Low entry point — you don’t need a large amount to get started.

Cons:

Volatility — prices can jump around like a toddler on a sugar rush.
Market swings — can make even calm investors nervous.
Emotional risk — buying high and selling low is a common (and costly) mistake.

2. Private Investments — The Scenic Back Road

Private investments aren’t traded on public exchanges, so they follow different rules.

Examples:

Private equity — ownership in non-public companies.
Private real estate — commercial buildings, developments, rental projects.
Private credit/debt — lending directly to businesses or developers.
Venture capital — backing start-ups with big potential (and big risk).

Pros :

Potentially higher returns — sometimes the scenic road leads to a five-star resort.
Diversification — performance often differs from public markets.
Exclusive opportunities — access to deals not available on the open market.

Cons:

Illiquidity — your money is tied up for years, not days.
Higher risk — projects can fail or underperform.
Less oversight — fewer regulations and reporting requirements.

3. How They Work Together

Think of public investments as your daily bread — reliable and always available.
Think of private investments as your specialty dessert — richer and potentially more satisfying, but best enjoyed in moderation.

A healthy portfolio can have both:

Public investments for flexibility, liquidity, and steady income.
Private investments for long-term growth potential and diversification.

Bottom Line:
It’s not about public vs. private — it’s about finding the right balance for your goals, time horizon, and comfort with risk.

When your portfolio has the right mix, you can enjoy the journey — whether you’re cruising the highway or soaking in the views along the scenic route.

Source: www.bloomberg.com

August Market Update

Fri, 15 Aug 2025 18:01:54 GMT

2025 Year-to-Date: Market & Economy Snapshot

2025 Year-to-Date: Market & Economy Snapshot

Here is a quick investment summary for the year:

Source: Bloomberg.com

CAD returns reflect currency movements — the Canadian dollar’s strength in 2025 has trimmed U.S. and international performance for Canadian investors.

Monthly Returns - 2025

If we look at monthly we can see that things have mostly been positive, other than a few months.

¹Partial month to Aug 14

Source: bloomberg.com

Market Mood: Calm with Occasional Surprises:

Most of 2025 has seen low volatility , but there have been two notable exceptions:

Early-summer tariff flare-up — U.S.–China and U.S.–EU trade tensions briefly rattled markets before talks cooled nerves.
Liberation Day rally — Major geopolitical agreement boosted confidence and helped equities recover quickly from the tariff dip.

Outside these blips, market moves have been steady, with economic data releases (CPI, GDP, jobs) being the main short-term catalysts.

Going forward it is (as always) difficult to predict.

Economic Highlights:

Canada

Bank of Canada Interest Rate: 2.75% (held July 30) — cautious stance with potential easing if growth slows.
Inflation: 1.9% (June) — near target.
Jobs: Unemployment at 6.9% in July, showing signs of labour market softening.

United States

GDP: Q2 growth +3.0% annualized — stronger than expected.
Inflation: CPI at 2.7% (July) — close to target, but producer prices hotter.
Jobs: Unemployment at 4.2%.

International

Euro Area: GDP +0.1% (Q2) — weak growth, inflation at 2.0%.
Japan: Strong equity performance driven by corporate reforms and weaker yen.

Investor Takeaways

Goldilocks feel — Growth steady, inflation easing, volatility low… apart from brief tariff and geopolitical jolts.
Currency matters — CAD strength has reduced foreign returns in 2025.
Diversification pays — International markets lead this year, even after currency effects.
Stick to your long-term plan and avoid chasing short-term leaders.

What to Expect for the Rest of 2025

Global and Canadian growth remains modest—not robust—but not collapsing.
Markets face bifurcated risks :

Bearish : Softening growth, inflation stickiness, elevated valuations could spark corrections (10–14%).
Bullish : Structural reform, AI, and policy shifts may fuel gains into early 2026.

3. Volatility remains subdued , though hedging strategies may be prudent due to high valuations and policy-driven uncertainty.

4. Diversification remains vital —across geographies and themes—to navigate uncertainty.

Source: Bloomberg.com

5 Habits That Set the Wealthiest Client's Apart

Thu, 14 Aug 2025 22:32:28 GMT

Here are the five proven habits wealthiest clients have in common—and how you can apply them to your own financial plan.

Discover the 5 money habits that help the wealthiest people build and preserve their fortunes.

Learn how to set clear goals, invest consistently, prepare for the unexpected, diversify income, and seek expert advice.

When it comes to building wealth, high income alone isn’t the secret. In fact, many of the richest people aren’t CEOs or celebrities—they’re everyday professionals who follow disciplined financial habits that keep them on track year after year.

1. Set Clear and Specific Financial Goals

Wealthy individuals don’t just wish for financial success—they map it out. They define exactly what they want, when they want it, and why it matters. Then they put systems in place—automatic transfers, dedicated savings accounts, and regular progress tracking—to stay on course.

2. Invest Regularly and Consistently

Timing the market is a gamble. Wealthy clients avoid it altogether, instead committing to a consistent investment schedule. Using dollar-cost averaging , they invest the same amount monthly, allowing their money to grow steadily through market ups and downs.

Beginner’s Guide to Investing for Long-Term Growth

3. Protect Against the Unexpected

Financial setbacks happen—medical bills, job loss, or urgent repairs. Wealthy clients prepare in advance by keeping a 6-month emergency fund, choosing the right insurance* coverage, and creating an estate plan.

4. Diversify Income Streams

Relying on a single paycheck can be risky. High-net-worth individuals build multiple income sources—rental properties, side businesses, investments, consulting—to reduce dependency on one stream and safeguard their lifestyle during economic downturns.

5. Work With Trusted Professionals

Even the savviest investors know the value of expert guidance. Wealthy clients often work with financial advisors , tax specialists, and estate planners to ensure their strategies are efficient, compliant, and optimized for growth.

The Takeaway

Wealth isn’t built overnight—it’s the result of consistent, intentional habits practiced over time.

By following these five principles, you can strengthen your financial foundation and move closer to long-term security and freedom.

Source: https://www.businessinsider.com/financial-planner-richest-clients-same-habits-2024-5

Navigating the Ups and Downs: Your 2025 Mid-Year Market Review

laura@rightdirectionfinancial.com (Laura Chanin) — Wed, 23 Jul 2025 22:17:13 GMT

Mid-Year Market Check-In: What's Happened & What's Ahead

2025 Mid-Year Market Review: What’s Going On & What It Means for You

We’re halfway through 2025, and it’s been quite a ride in the markets. From sticky inflation to shifting political winds, things haven’t always been smooth—but there’s also been plenty of opportunity for savvy investors. Here’s a quick, easy-to-digest look at what’s happened so far and what we’re keeping an eye on for the rest of the year.

2025 Mid-Year Market Review: Key Takeaways for Investors

The first half of 2025 has brought both challenges and opportunities for investors. With ongoing inflation, political shifts, and global tensions, markets have been bumpy. But active investment managers found ways to adjust and uncover new growth potential. Here’s a simple overview of what’s happened so far and what might come next:

Market Highlights

Market ups and downs returned as new U.S. trade policies and global conflicts shook investor confidence.
Inflation is still high , so central banks have been slow to cut interest rates.
Canada’s stock market did better than the U.S., thanks to strength in energy, financial, and resource companies.

How Investment Managers Responded

Bond & Income Strategies:

Some managers reduced their focus on U.S. bonds and shifted into European and Asia-Pacific bonds , where conditions were more promising.
They actively managed interest rate sensitivity and foreign currency exposure , benefiting from a weaker U.S. dollar.
Higher-yield bonds stayed appealing because of strong demand and solid financial fundamentals.

Stock Market Trends

U.S. stocks had a tough start , especially in tech, due to concerns about trade policy.
Canadian stocks became more attractive , with investors focusing on local companies in energy, banking, and gold.
AI and innovation continue to be long-term areas of opportunity. Managers stayed invested in top-quality companies that are leading in AI, healthcare breakthroughs, and manufacturing returning to North America.

Managing Risk

Many teams focused on investing in strong, well-run companies with good profits and reliable dividend payments.
They stressed the importance of careful stock picking and focusing on real value instead of chasing trends.

What to Watch for in the Second Half of 2025

Inflation Pressures: Tariffs, energy prices, and government spending may keep inflation higher than normal.

Policy Changes: Investors are watching the U.S. government for shifts in trade rules, taxes, and central bank leadership.

Global Conflicts: Ongoing tensions in Ukraine and the Middle East may continue to affect markets. Gold and natural gas are being used as protection against uncertainty.

Global Opportunities: Many managers still see value in international stocks and bonds , especially in Europe and select emerging markets.

Diversification Matters: A balanced mix of stocks and bonds, with a focus on quality and global reach, remains a smart approach.

Final Thoughts

2025 has been anything but predictable, but smart, flexible strategies are helping investors stay on track. While the rest of the year may still be bumpy, there are still many ways to grow and preserve wealth.

What This Means for You

Staying invested through uncertainty isn’t always easy—but it’s often where long-term value is found. This is when active management and a steady, diversified plan really shine. As always, we’re here to guide you through whatever the markets throw our way.

If you’d like to chat about your portfolio or have questions about the year ahead, just reach out—we’re happy to help.

Source: Based on insights from IA Clarington’s portfolio managers as of June 2025.

Here are the returns to July 23rd, 2025 :

Source: Bloomberg.ca

Maximizing Your CPP & OAS

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 23 Jul 2025 22:17:05 GMT

Understanding CPP and OAS: Claiming Benefits at the Right Time

How to Maximize Your Retirement Income

When it comes to retirement, the decisions you make around timing can have a lasting impact on your financial security—especially when it comes to government benefits like the Canada Pension Plan (CPP) and Old Age Security (OAS) .

While both programs provide a steady stream of retirement income, the amount you receive depends largely on when you choose to start collecting.

Timing Matters: Early vs. Delayed CPP & OAS

CPP : You can start collecting as early as age 60, but if you delay until 70, your monthly benefit could be up to 42% higher .

OAS : Eligible at 65 but deferring until 70 can increase your payments by 36% .

Delaying may not be right for everyone, but it’s worth running the numbers. The difference can mean thousands of dollars more over the course of your retirement.

What to Consider Before You Decide

Choosing when to start CPP or OAS isn’t just about maximizing income—it’s about aligning your choices with your lifestyle , health , and financial needs . Here are some important factors to weigh:

Life Expectancy : The longer you live, the more beneficial it is to delay.

Other Income Sources : Do you have RRSPs, a pension, or investment income to rely on in the meantime?

Tax Considerations : Starting benefits earlier may result in more years of taxable income, which can affect OAS clawbacks and your overall tax bracket.

Cash Flow Needs : Sometimes you need the money sooner, and that’s okay—just make sure it’s a decision, not a default.

Blending Strategy with Flexibility

One smart approach is to use your personal savings (RRSPs, TFSAs, non-registered accounts) to fund the early years of retirement while deferring government benefits. This can allow your CPP and OAS to grow while reducing your taxable income today.

Every person’s situation is different—and that’s why planning matters.

Source: www.canada.ca

The Reality of Being “House Rich, Cash Poor” in Retirement

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 12 Jun 2025 21:26:37 GMT

The Reality of Being “House Rich, Cash Poor” in Retirement

In Canada, owning a home is practically a national pastime.

For many, buying property is viewed as the ultimate financial milestone. But there’s a hidden downside to this mindset: some Canadians reach retirement house rich but cash poor. In other words, they may own a valuable home, yet lack the liquid assets and income needed to fund a comfortable retirement.

It often begins with stretching your budget to buy a house, under the assumption that building home equity will set you up financially in the long run. Fast forward a few decades, and while your property may be worth a fortune on paper, most of that wealth is locked away—leaving you with limited resources to cover daily living expenses.

Qualifying for GIS

Many seniors wonder: Can I qualify for the Guaranteed Income Supplement (GIS) if I own a high-value home but have little in the way of other financial assets? The surprising answer is yes. GIS eligibility is based on income and marital status, not the value of your assets—including your home.

Taking Out a Mortgage Later in Life

What happens when a senior who owns their home outright starts running out of savings? There are generally two options:

Take out a mortgage to free up some cash to invest or spend.
Sell the home and switch to renting.

Both options have pros and cons and should be carefully weighed based on your financial situation and personal preferences.

The Problem with Tied-Up Wealth

The core issue with being house rich and cash poor is that home equity isn’t easily converted into spendable cash. If you have savings in a TFSA, RRSP, or RRIF, you can move money into your chequing account at any time. But accessing your home’s value is more complex—and often costly.

This is why some retirees are sometimes referred to as “poor millionaire homeowners.” For example, in 2021, nearly 7,000 seniors in Toronto’s 50 wealthiest neighborhoods owned homes valued at over $1 million, yet they were living on incomes below the poverty line.

Options for Accessing Home Equity

If selling your home isn’t appealing, borrowing against it is another option. Two of the most common strategies are a Home Equity Line of Credit (HELOC) or a reverse mortgage. But both come with important considerations:

HELOCs

HELOCs allow you to borrow up to 65% of your home’s value and transfer funds quickly to your chequing account. However, interest rates are no longer cheap—currently ranging between 5.45% and 5.95%. If used for long-term income, interest payments can easily become unsustainable.

Reverse Mortgages

Reverse mortgages are designed for older homeowners needing regular cash flow. You borrow against your home’s value without making monthly payments; instead, the interest compounds and is repaid when you sell the home.

However, reverse mortgages have significant drawbacks:

High interest rates : Typically between 6.6% and 8%, which causes debt to grow rapidly.
Eroding home equity : Over time, compounding interest can consume most of your equity.
Fees and penalties : Setup fees can be high, and early repayment often triggers penalties.
Reduced inheritance : Your heirs may receive little or nothing after the mortgage is repaid.
Impact on benefits : While reverse mortgage proceeds aren’t taxable income, they can affect eligibility for certain government benefits.

A Word of Advice

If you’re still working and worried about future retirement income, it’s wise to secure a HELOC now, while it’s easier to qualify. And if you’re planning to buy a home, choose one that allows you to save adequately for retirement.

Ultimately, being house rich and cash poor is a fixable problem—but it usually requires making tough, informed decisions.

Careful planning can help you maintain financial flexibility in retirement without sacrificing peace of mind.

Source: www.macleans.ca

The State of Caregiving Among Canadians 50+: A Nation of Unseen Heroes

leslie@rightdirectionfinancial.ca (Leslie Sommer) — Thu, 12 Jun 2025 21:26:35 GMT

The State of Caregiving Among Canadians 50+: A Nation of Unseen Heroes

Across Canada, millions of adults aged 50 and older are quietly performing one of the most demanding and meaningful roles there is: that of caregiver. Whether supporting an aging parent, spouse, sibling, or friend, these caregivers form the backbone of an informal healthcare system that often goes unseen.

Yet, as Canada’s population ages and healthcare needs grow more complex, the state of caregiving among Canadians 50+ is a story we cannot afford to ignore.

A new report based on the 2024 NIA Ageing in Canada Survey paints a clear picture of the growing challenges facing caregivers—and the urgent need for public policy action.

The Numbers Behind Caregiving in Canada

Nearly 8 million Canadians currently provide care for a family member or friend facing health, disability, or age-related challenges.
Caregivers contribute an estimated 5.7 billion unpaid hours annually—work valued at more than $97 billion .
Among Canadians aged 50+, 15% identify as active caregivers.

Who Are the Caregivers?

Caregivers aged 50+ are a diverse group:

Age breakdown : 63% are between 50–64; 28% are 65–79; and 10% are 80+—meaning many older caregivers are themselves seniors.
Gender : While women continue to make up the majority (55%), caregiving is becoming more common among men (45% in 2024, up from 41% in 2023).
Geography : Two-thirds of caregivers aged 50+ live in Ontario and Quebec. Manitoba and Saskatchewan have the highest proportion of caregivers aged 50+, at 17% .

The Impact of Caregiving on Personal Well-being. Being a caregiver is a labour of love—but it comes with personal costs.

Social Isolation

31% of caregivers aged 50+ say they are too busy to participate socially as often as they’d like (compared to 19% of non-caregivers).
44% cite financial barriers that prevent them from engaging in social activities.

Mental Health

Only 49% of caregivers aged 50+ report excellent or very good mental health—lower than the 55% of non-caregivers.
Caregivers are more likely to report "good" mental health (30%) rather than excellent or very good.

Experiences of Ageism

17% of caregivers aged 50+ experienced age discrimination in the past year, compared to just 7% of non-caregivers.
29% feel undervalued , believing people often or sometimes assume they “don’t do anything important”—compared to 19% of non-care gi vers

Financial Strain on Caregivers. Financial concerns weigh heavily on caregivers:

55% of caregivers aged 50+ worry about running out of money in the future—higher than the 47% of non-caregivers.
Only 43% of caregivers who needed home care services could access them consistently—compared to 52% of non-caregivers.
Caregivers are more likely to be financially stretched, with 19% reporting their income is not enough and they are struggling , compared to 15% of non-caregivers.

Why Canada Needs a National Caregiving Strategy

The Canadian Centre for Caregiving Excellence (CCCE) and its partners are calling for a National Caregiving Strategy —and for good reason.

Caregivers provide essential support that keeps Canada’s healthcare system running. Without them, vulnerable Canadians would face higher risks and hospitals would be overwhelmed.

But caregivers cannot do it alone.

Key priorities ideally would include:

Expanded financial supports and tax relief
Improved access to home care and community services
Workplace flexibility for employed caregivers
Greater public recognition of caregivers’ vital contributions

The Bottom Line

Caregivers aged 50+ are the unsung heroes of Canadian healthcare. But they face significant emotional, social, and financial challenges. As demand for care continues to grow, Canada must step up with stronger policies and better support systems.

If we value the well-being of our seniors, families, and communities, supporting caregivers must become a national priority.

Source: https://canadiancaregiving.org/

June 2025 Market Update: Resilience Meets Geopolitical Tension

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 12 Jun 2025 21:26:23 GMT

As we move through June, markets are navigating a landscape shaped by steady economic data, cautious central banks, and rising geopolitical risks—particularly around trade and tariffs. Here's what's shaping investor strategy this month.

Equities: Resilient, But Sensitive to Headlines

Global equity markets have held their ground, with the S&P 500 and TSX Composite regaining their drops after Liberation day. Gains in technology, infrastructure, and AI-driven innovation continue to support broader performance, while interest-sensitive sectors like real estate and discretionary retail remain challenged.

However, volatility has increased. Investor sentiment is being shaped by both central bank guidance and headline-driven risks—particularly from renewed U.S. trade tensions.

Central Banks: Holding but , But Not Cutting (Yet)

The U.S. Federal Reserve and the Bank of Canada both opted to hold interest rates steady this month. Inflation is moderating but remains elevated in services, and both central banks have emphasized a cautious, data-driven path forward. Markets are now pricing in one potential rate cut before year-end, depending on upcoming economic data.

Bond Markets: Steady Yields, Mild Credit Risk

Bond yields remain in a holding pattern. U.S. 10-year Treasuries hover around 4.3%, and Canadian yields slightly below that. Short-term fixed income remains attractive for income-seeking investors. Credit spreads have widened slightly as markets digest tariff-related risks.

Tariffs & Trump: Trade Uncertainty Resurfaces

Trade policy is back in the spotlight with former President Trump making significant moves:

Steel & Aluminum Tariffs : Now at 50%, with only the UK exempted.
Automotive Sector : More tariff increases are under discussion, raising concerns for global supply chains.
Targeting Allies : Canada, the EU, Japan, and South Korea are potential targets as Trump leans into bilateral trade enforcement.
China Deal : A tentative framework holds 55% tariffs in place but opens doors to U.S. access for rare earths and academic cooperation.
Legal Landscape : The U.S. Appeals Court has temporarily upheld key Trump-era tariffs; a full hearing is scheduled for July 31.

These measures are already impacting corporate earnings. Major automakers report billions in added costs, and retaliation from trade partners—including Canada—may further escalate tensions.

Investment Strategy: Quality Matters More Than Ever

In a market increasingly influenced by politics and policy, fundamentals remain key. Investors should:

Focus on high-quality companies with proven earnings, stable cash flow, and low levels of debt.
Look for businesses with strong pricing power and domestic supply chains to reduce trade exposure.
Maintain diversification across asset classes and geographies to manage short-term volatility.
Consider trimming exposure to sectors heavily reliant on global trade or high-cost imports.

Bottom Line

Despite geopolitical tension and policy uncertainty, the market continues to reward resilience. Trade disputes may bring short-term disruption, but long-term fundamentals—like company quality, balance sheet strength, and strategic positioning—will drive outcomes.

Plan for the long term, but keep an eye on near-term risks.

Source: Bloomberg

Estate Planning: Swedish Death Cleaning

leslie@rightdirectionfinancial.ca (Leslie Sommer) — Fri, 16 May 2025 18:07:32 GMT

Imagine walking into your childhood home, only to find it frozen in time—every drawer brimming with old receipts, closets packed with outdated clothes, and shelves lined with knickknacks from decades past.

That's exactly what happens to many of us when our parents pass away, leaving behind a house untouched by decluttering or downsizing.

The term "death cleaning," or "döstädning" in Swedish, refers to the process of sorting through one's belongings before they pass on. While it might sound morbid, it's a necessary and often therapeutic task. For many, this means sifting through years of accumulated items, each holding memories, emotions, and sometimes, surprises.

As you navigate this overwhelming process, you may find ourselves grappling with questions many of us will face:

What do we keep?
What do we let go?
How do we honor our loved ones' memories without being buried under their possessions?

It is an emotional journey of death cleaning, emphasizing the importance of organizing and decluttering—not just for ourselves, but for those we leave behind. It's a poignant reminder that while our belongings tell our stories, it's the memories and connections that truly matter.

Swedish death cleaning, or " döstädning " in Swedish, is a practice of decluttering your belongings as you age to make things easier for your loved ones after you're gone.

The concept was popularized by Margareta Magnusson in her book "The Gentle Art of Swedish Death Cleaning."

It’s not just about tidying up—it's a thoughtful process of organizing your life and letting go of items that no longer serve you. The idea is to reduce the burden on your family when they eventually have to sort through your possessions.

It encourages you to focus on what truly matters and be mindful of the memories you leave behind.

Here are some practical tips to get started with Swedish death cleaning:

1. Start Early and Small:

You don't have to wait until you're elderly to begin. Start now with manageable areas like a single closet or a drawer.

2. Reflect on Your Belongings:

Ask yourself: Does this item bring me joy? Will someone else find it meaningful? If not, it might be time to let it go.

3. Prioritize Personal Items:

Begin with things that are easy to part with (like outdated paperwork), and save sentimental items (like photos or keepsakes) for later.

4. Involve Loved Ones:

Talk to your family about what they'd like to keep. Sometimes the things you find insignificant might hold value to them.

5. Label and Organize:

Clearly label items you want to pass on. Write down stories or memories associated with heirlooms so your family knows why they’re special.

6. Create a Memory Box:

Keep one small box for truly meaningful items. This helps you focus on quality rather than quantity.

7. Digitize What You Can:

Scan old photos and important documents. This reduces physical clutter while preserving memories.

8. Give Away While You’re Alive:

Share valuable items or keepsakes now, so you can see the joy they bring to others.

9. Document Your Wishes:

Make a list of items and where they should go. Include instructions for any valuable or sentimental items.

10. Be Kind to Yourself:

It’s an emotional process—take breaks when needed and remind yourself that this is a gift of thoughtfulness for your loved ones.

There are companies within BC that can help with decluttering and organizing if your parent(s) is overwhelmed.

Source: https://www.montrealgazette.com/entertainment-life/article661455.html

The Importance of Diversification in Investing

laura@rightdirectionfinancial.ca (Laura Chanin) — Fri, 16 May 2025 18:07:31 GMT

Why Diversification Matters: A Key to Financial Success

Planning for financial security is more important than ever. Whether you’re approaching retirement or already enjoying your golden years, making informed investment choices can help you live confidently and comfortably. This month, we’re focusing on a crucial investment strategy: diversification.

Investing in your future is crucial, especially as you approach retirement. Diversification is more important than ever to secure financial stability and growth. In today’s economic landscape, diversification is the key to managing risks and achieving sustainable returns.

Why Diversification Matters

Diversification is the practice of spreading your investments across various asset classes, such as stocks, bonds, real estate, and more. This strategy helps minimize the impact of poor performance in a single investment, preserving your portfolio from significant losses.

Women often face unique financial challenges, including longer life expectancies and potential gaps in retirement savings. Diversifying your investments not only mitigates risks but also maximizes opportunities for growth. A well-diversified portfolio can help you maintain financial independence throughout your retirement years.

Practical Steps to Diversify Your Portfolio

1. Assess Your Current Investments: Take stock of your current assets and their performance. Are they concentrated in one sector or asset type?

2. Incorporate Different Asset Classes: Consider adding fixed-income securities, dividend-paying stocks, and international assets to balance growth and stability.

3. Regularly Rebalance Your Portfolio: As markets shift, ensure your asset allocation aligns with your risk tolerance and financial goals.

4. Consider Professional Advice: An investment advisor experienced in retirement planning can help tailor a strategy to your needs.

Looking ahead In 2025, economic conditions can be unpredictable, and it’s crucial to stay proactive. By diversifying, you not only preserve your hard-earned savings but also create a resilient investment strategy that adapts to changing markets.

Source: Bloomberg.com

May Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Fri, 16 May 2025 18:07:29 GMT

What was it all for?

May Market Update: What Was All That For?

After a bumpy April filled with market ups and downs, US stocks have come roaring back in May — and then some. If you’ve been sticking to your investment plan (even if just barely holding on), you’re now seeing positive returns for the year.

What happened?
On Tuesday, May 13, US markets rallied after U.S. inflation data came in lower than expected. The S&P 500 rose 1%, and the Nasdaq-100 jumped 1.75%, helped along by a major spike in Nvidia stock (up 6% after announcing a chip deal with Saudi Arabia).

This marks the first time both indexes have been positive year-to-date since February. It’s a good reminder that markets can bounce back faster than expected — especially after a stretch of uncertainty.

What’s behind the rebound?
Markets also reacted positively to news of a 90-day tariff truce between the U.S. and China , easing fears around global trade. The U.S. plans to lower tariffs on Chinese goods to 30%, and China will reduce tariffs on U.S. imports to 10%. That’s been enough for some economists to dial back recession concerns for 2025. If you’ve had trouble keeping up, here are charts showing what the tariffs between the US and China have been at since Feb 4.

But wait — what does this mean for you?
Some experts are still cautious. There’s concern that trade policy could cause prices to rise again in the months ahead. Inflation isn’t solved, and global uncertainty isn’t going anywhere just yet.

The key takeaway?
If you stayed invested, you’ve likely now recovered what was lost earlier in the year — and maybe even gained a bit. The lesson here? Trying to time the market can cost you.

Here is a chart that shows the value of staying invested.

So if your portfolio gave you a few grey hairs in April — take a deep breath. Staying the course often pays off.

Here are the YTD returns at May 15 ^th :

Any questions, let me know. I’m here to help

Laura

Sources:

Ycharts.com

www.bloomberg.ca

March Market Turmoil

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 13 Mar 2025 22:16:14 GMT

Hopes for a quick rebound from the worst bout of market volatility in years were dashed as the specter of a spiraling global trade war pummeled equities while Canada’s dollar was hammered.

US stocks buckled again after Donald Trump’s latest trade-war salvo against Canada, with the S&P 500 sliding to within a whisker of a correction and mega cap technology resuming a selloff that has wiped out trillions in value.

The US president said Tuesday he would double steel and aluminum tariffs on Canada to retaliate against Ontario’s move raising taxes on electricity sent to the US, ramping up his fight with the US’s largest trading partner.

It’s been a dizzying turn of events for investors accustomed to years of US tech gains and a resurgent dollar, and traders are looking to bonds and currencies around the world to escape.

I get it; things are upsetting right now on many levels. To me it feels like my best friend stabbed me in the back. The uncertainty is hard to take as well as all the actions the US government is taking right now – on so many levels.

I worry about the future especially for my kids.

On the other hand, I’m proud of how Canadians are sticking together and being strong. I’m happy this has brought out the patriotic side of our country, so that is positive.

In terms of investments, what can we do?

The first is to not panic.

Market fluctuations are a natural part of investing. While short-term headlines often amplify concerns, history has shown that markets recover and grow over the long run. Successful investing is not about avoiding volatility but managing it with discipline, patience, and a well-structured plan.

Here are a few key points to keep in mind:

Volatility is Normal: Market pullbacks happen regularly, but they are often followed by periods of growth. Historically, downturns have been temporary, while long-term progress has been steady, like a yoyo on an elevator
Stay Focused on Your Goals: Your portfolio is designed with your long-term objectives in mind, balancing growth potential with risk management. Reacting impulsively to short-term market movements can be counterproductive.
Diversification Matters: A well-diversified portfolio helps cushion against market swings, ensuring you’re not overly exposed to any single investment or sector. Fortunately for us, we don’t have any clients that are all in stocks. Most of us also own bonds and private investments, so when the market is down a lot, you are likely down much less, or may still be up. We also invest across the globe, not just North America and from the initial chart you can see that other than the US, other investment markets are positive for the year.
Opportunities Arise in Volatile Markets: Market corrections can present opportunities to invest at more attractive valuations. Staying the course often rewards patient investors.
We Are Here for You: If recent market moves have you concerned, let’s discuss your portfolio and long-term strategy. We can review your plan, answer any questions, and ensure your investments remain aligned with your financial goals.

While market volatility can be unnerving, staying disciplined and maintaining perspective is key. If you have any concerns or would like to discuss your portfolio, please don’t hesitate to reach out.

This shows what happens if you miss even a few of the best days of the market:

Sources: www.bloomberg.com

1 Chart: Bloomberg

2 Chart: JP Morgan

Protecting Yourself From Financial Scams

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 13 Mar 2025 21:47:48 GMT

Protecting Yourself from Financial Scams in Canada: Tips for 2025

March is National Fraud Prevention Month

With financial scams becoming more sophisticated, it’s crucial for Canadians to stay informed and vigilant. Fraudsters are constantly developing new tactics to steal money and personal information.

Understanding how to recognize scams, knowing your consumer rights, and reporting fraudulent activity can help protect you and others.

Here’s what you need to know in 2025.

1. Recognizing Common Financial Scams

Scammers use various tactics to deceive individuals. Some of the most prevalent scams in Canada include:

Phishing Emails & Texts: Messages pretending to be from banks, government agencies, or businesses, asking for personal details.
Investment Scams: Promises of high returns with little to no risk, often involving cryptocurrency or fake stock opportunities.
Fake CRA Calls: Fraudsters posing as Canada Revenue Agency (CRA) agents, demanding immediate payment for supposed tax debts.
Romance Scams: Fraudsters build online relationships and eventually ask for money under false pretenses.
Tech Support Scams: Calls or pop-ups claiming your device is compromised, urging you to pay for unnecessary services.

2. Understanding Your Consumer Rights

As a Canadian consumer, you have rights and protections against fraud. These include:

Chargeback Protections: Credit card companies allow consumers to dispute unauthorized transactions.
Privacy Laws: Organizations must protect your personal information and cannot share it without consent.
No Immediate Payment Demands: Government agencies and legitimate businesses do not demand payment via gift cards, cryptocurrency, or wire transfers.
Cooling-Off Periods: Some purchases and contracts allow for cancellation within a set timeframe.

3. Where to Report Fraudulent Activity

If you suspect fraud or have fallen victim to a scam, report it as soon as possible. Key agencies to contact include:

Canadian Anti-Fraud Centre (CAFC): Report fraud and scams at Your Bank or Credit Card Provider: Inform them immediately to block fraudulent transactions and recover lost funds.
Local Law Enforcement: File a report if you’ve suffered financial loss due to fraud.
The Competition Bureau: Report deceptive business practices and fraud at www.competitionbureau.gc.ca.

4. Preventative Measures to Stay Safe

Verify Requests: Contact companies directly using official phone numbers before sharing information.
Monitor Your Accounts: Regularly check your bank and credit card statements for unauthorized transactions.
Enable Two-Factor Authentication: Adds an extra layer of security to online accounts.
Educate Yourself & Others: Share scam warnings with family and friends to prevent them from becoming victims.

Final Thoughts

Fraudsters are always looking for w ways to exploit individuals, but staying informed and cautious can help protect you. By recognizing scams, understanding your rights, and reporting fraudulent activity, you can safeguard your finances in 2025.

Source: www.canada.ca

Retirement Planning for 2025 and Beyond

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 13 Mar 2025 21:36:25 GMT

For decades, retirement planning followed a model designed for a different time.

When modern retirement took shape in the mid-20th century, life expectancy was barely 70. Most people spent only a handful of years in retirement—if they lived that long.

But times have changed.

People are living longer, healthier lives, and the nature of work has evolved. Knowledge-based careers, flexible work arrangements, and digital connectivity mean that retirement is no longer about stopping—it’s about discovering what comes next.

We can help navigate this new reality by creating a retirement plan that adapts to your evolving needs and aspirations.

How We Help You Redefine Retirement

Instead of fully exiting work, many retirees today choose a phased transition rather than an abrupt stop. Some launch businesses or embark on encore careers. Others combine work, education, and leisure into a portfolio lifestyle.

Retirement is about what comes next, not just stepping away from work. A recent study by Edward Jones found that 53% of pre-retirees see retirement as a new chapter focused on meaning and fulfillment.

Statistics Canada data reflects this shift:

55% of those planning to retire would work longer if they could reduce their hours.
49% would extend their careers if fewer hours didn’t impact their pensions.
43% would stay in the workforce if their job was less stressful.

Instead of asking yourself, “ When should I retire ?”, we look at, “ How do I want to design my next c hapter ?”

Three Ways To Support Your Retirement Planning

Creating a Flexible Transition Plan
The traditional approach assumes retirement happens at a fixed age. But many people today want flexibility. We help build a plan that allows for phased retirement, sabbaticals, or part-time work while maintaining financial security.
Customizing Your Investment and Withdrawal Strategy
The conventional retirement model assumes a steady drawdown of assets, but this may not align with the realities of modern retirees—especially those continuing to earn income.

You can use a growth-oriented portfolio if you plan to keep working, create a withdrawal plan that adjusts to variable income sources, and optimize your CPP and OAS strategies for long-term financial security.

3. Designing a Retirement That’s About More Than Just Money .

Retirement isn’t just about financial security; it’s about designing a fulfilling, healthy life. We’ll work with you to ensure your plan includes purpose, engagement, and social connection.

Staying engaged in meaningful work contributes to better health and longevity.
Retirees who lose their sense of purpose often struggle with mental health challenges.
Social engagement is a key predictor of happiness and well-being.

Have you thought about how you’ll stay active, engaged, and connected in retirement? A retirement plan that ensures not only financial stability but also a rich and meaningful life.

Source: Simon Chan, MBA, CFP is a strategic advisor on longevity & retirement innovation, and the founder and CEO of Adapt with Intent Inc.

Market Update: February

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 13 Feb 2025 22:38:54 GMT

Stock Market Update – 2025: A Steady Start but uncertainty Looms

The Canadian stock market has kicked off 2025 on solid ground, even as investors keep a close eye on the U.S., where President Trump’s second term is shaking things up. The S&P/TSX Composite Index has held steady, thanks to strong performances in energy, technology, and financials. Meanwhile, south of the border, U.S. markets have had a bumpier ride as new policies take shape.

How’s Canada Doing?

So far, the TSX has been fairly stable. The Bank of Canada is taking a careful approach to interest rates, keeping borrowing costs high enough to manage inflation but not so high that they hurt economic growth.

Canadian businesses, especially in tech and energy, are seeing steady investment, though consumer spending is a bit more cautious. It is expected interest rates will reduce 3 more times this year.

What’s Happening in the U.S.?

U.S. markets have been more unpredictable, reacting to President Trump’s economic policies and global uncertainties. Here are the biggest trends:

�� Trump’s Tax & Trade Moves – Lower corporate taxes are good for U.S. businesses, but trade tensions could make things trickier for Canadian exporters. Investors are watching closely to see how this plays out.

�� High Interest Rates – The U.S. Federal Reserve has kept rates elevated to fight inflation, which has made borrowing more expensive and slowed down stock market momentum. This could have ripple effects on Canada’s economy, too.

�� Oil & Energy – Trump’s pro-oil stance has helped North American energy stocks, which is good news for Canada’s oil producers. But global oil prices are still unpredictable, which means some volatility ahead.

�� Tech’s Big Year – AI, cybersecurity, and cloud computing continue to drive U.S. market growth, and Canada’s tech sector is benefiting, too. However, new regulations could shake things up for big tech companies.

What About Europe?

European markets have been mixed in early 2025. The FTSE 100 in the UK has gained strength thanks to strong banking and energy stocks, while the Euro Stoxx 50 has been more volatile, with investors navigating high inflation and slower economic growth in Germany and France.

What Should Investors Do?

With uncertainty across the globe, the typical balanced investment strategy is key. Here are some recommendations:

✅ Diversify – Spread investments across different sectors, including stable Canadian industries like financials, utilities, and energy, while maintaining some exposure to growth sectors like tech and AI.

✅ Keep an Eye on Interest Rates – If rate cuts happen later in the year, real estate and financial stocks could benefit.

✅ Be Cautious with U.S. Exposure – While U.S. markets offer growth potential, trade and tax policy changes could bring volatility. Make sure you include a mix of Canadian and international stocks to manage risk.

✅ Look for Dividend Stocks – In uncertain times, dividend-paying stocks can provide steady income and stability.

✅ Stay Patient & Invest for the Long Term – Markets will have ups and downs, but a long-term approach can help smooth out short-term volatility.

Sources:

www.bloomberg.ca

www.msn.com

As You Approach Retirement: Things to Consider (or Worry About at 3 AM)

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 13 Feb 2025 22:38:53 GMT

Retirement: Relaxation! Travel! or Not...

Retirement is often painted as a time of relaxation, travel, and finally tackling that never-ending reading list. But let’s be real—there’s a lot more to think about than just booking cruises and perfecting your golf swing.

From making sure your savings last to figuring out when to take government benefits (and how to actually enjoy retirement without worrying about money), there’s plenty that might be keeping you up at night.

The good news? With the right planning, you can trade those 3 AM worries for peace of mind.

Let’s break it all down.

1. Do I Have Enough Saved, or Will I Be Living on Instant Noodles?

Have I saved enough, or do I need to work until I’m 92?
What’s the magic number for retirement savings?
How do I make sure I don’t run out of money before I run out of life?

2. When Can I Retire Without Regret?

Should I retire now, or stick it out for a few more years?
Can I afford to work part-time instead of full-time?
What if I retire and then realize… I’m bored?

3. Will I Be Broke by 80?

How do I protect my savings from inflation, market crashes, and my own shopping habits?
What’s a safe amount to withdraw each year so I don’t end up broke in my 80s?
Should I be shifting my investments to something safer (or is that just boring)?

4. The Healthcare Bill Nobody Talks About

How much should I expect to spend on healthcare (and should I start selling things now)?
Do I need long-term care insurance, or is my plan just to be really, really nice to my kids?
What’s actually covered by government healthcare, and what will cost me?

5. The Bank of Mom & Dad

How do I balance my own retirement savings with helping out my kids?
What if my 30-year-old “boomerang kid” still lives at home?
What if my aging parents need financial help? Who’s helping me?

6. Am I Investing Right for Retirement?

Should I be more conservative with my money, or is that just another way of saying "let’s settle for less"?
Am I taking enough risk, or is my portfolio just sitting there, doing nothing?
How do I make sure my money keeps working for me, even when I’m not?

7. When Should I Take CPP/OAS (or Maximize My Free Government Money)?

Should I take CPP early, or wait and get more later?
How do I minimize taxes on my retirement income?
Am I getting the most out of my pension?

8. What If Something Happens to My Spouse (or We Call It Quits)?

Am I financially secure on my own?
How do I make sure I’m not left sorting out a financial mess if my spouse dies?
What estate planning do I need to do before something happens?

9. The “Fun” Part: Estate Planning

Do I have a will, or will my family be stuck in a never-ending legal nightmare?
Are my beneficiaries set up properly, or will my money go to my ex from 20 years ago?
How can I make sure CRA doesn’t take more than their fair share when I’m gone?

10. What Will I Do in Retirement?

What if I retire and suddenly miss having a reason to put on pants?
Do I have hobbies and interests that will keep me happy (or is Netflix my only retirement plan)?
How do I shift from saving my money to actually spending it without guilt?

Retirement planning isn’t just about numbers—it’s about making sure you can enjoy life, avoid financial disasters, and sleep at night knowing you won’t be working the checkout at Costco at 85 (unless you want to).

Would you like help figuring it all out? That’s what we’re here for!

Sources: www.mcleans.ca

Smart Tax Strategies for Women Nearing Retirement in Canada

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 13 Feb 2025 22:38:51 GMT

Smart Tax Strategies for Women Nearing Retirement in Canada

As a woman nearing retirement in Canada, you’ve likely spent years working hard, saving, and planning for retirement.

Now is the time to make the most of your financial resources by implementing smart tax strategies. By maximizing tax efficiency, you can reduce your tax burden and ensure your money lasts longer.

Here are some key tax strategies to consider:

1. Leverage RRSPs for Tax Deferral

A Registered Retirement Savings Plan (RRSP) is one of the most powerful tools for reducing taxable income. Contributions to an RRSP are tax-deductible, meaning you can lower your taxable income while growing your investments tax-free. Some key strategies include:

Contributing in high-income years to maximize deductions.
Withdrawing strategically in retirement to minimize taxes.
Using a spousal RRSP to split income with a lower-earning spouse.

2. Maximize TFSA Contributions

A Tax-Free Savings Account (TFSA) allows your investments to grow tax-free, and withdrawals are not taxed. This makes it an excellent vehicle for tax-efficient investing. Consider these TFSA tips:

Max out your annual contribution limit ($7,000 for 2024, with potential carry-forward room if you haven’t contributed in past years).
Invest for long-term growth since gains aren’t taxed.
Use your TFSA for withdrawals in retirement to avoid impacting income-tested benefits like Old Age Security (OAS).

3. Take Advantage of Pension Income Splitting

If you receive eligible pension income, you can split up to 50% of it with your spouse, reducing the overall tax burden. This can be especially beneficial if one spouse has a significantly higher income, helping to balance tax brackets and reduce the likelihood of OAS clawbacks.

4. Be Mindful of Old Age Security (OAS) Clawback

The OAS pension is subject to a recovery tax (clawback) if your income exceeds a certain threshold ($90,997 for 2024). To avoid losing part of your OAS, consider:

Withdrawing from a TFSA instead of an RRSP or RRIF, as TFSA withdrawals are not counted as income.
Splitting pension income with your spouse.
Managing withdrawals from investment accounts strategically.

5. Utilize the Age Amount and Pension Income Tax Credit

Once you turn 65, you may qualify for additional tax credits , including:

The Age Amount Tax Credit , which provides a non-refundable credit if your income is below a certain threshold.
The Pension Income Credit , allowing a deduction of up to $2,000 of eligible pension income.

6. Charitable Giving for Tax Savings

If you regularly donate to charity, you can claim a charitable donation tax credit , which can reduce your tax payable. Donating publicly traded securities can also provide additional tax advantages by avoiding capital gains taxes.

7. Consider Alternative Income Streams

If you’re still earning income through part-time work, freelancing, or investments, explore tax-efficient strategies such as:

Incorporating your business if you have significant self-employment income.
Taking advantage of home office deductions if you work from home.
Investing in dividend-paying stocks, as Canadian dividends receive preferential tax treatment.

Final Thoughts

Tax planning is an essential part of securing your financial future. By utilizing RRSPs, TFSAs, pension splitting, and other tax-efficient strategies, you can keep more of your hard-earned money and enjoy a comfortable retirement. Consulting a tax professional can help ensure you’re making the best decisions based on your unique financial situation.

Sources:

www.canada.ca

www.msn.ca

SMART Strategies for 2024: Review Your Finances and Set Goals for a Brighter New Year

laura@rightdirectionfinancial.ca (Laura Chanin) — Mon, 30 Dec 2024 22:14:41 GMT

As we step into 2025, it’s a great time to take charge of your finances and plan for a secure future.

As 2025 begins, it’s the perfect time to build on your financial achievements and align your resources with both personal and family priorities. Whether you’re maximizing your investments, advancing retirement plans, or supporting loved ones, adopting the SMART framework—goals that are Specific, Measurable, Achievable, Relevant, and Time-bound—can help you achieve clarity and progress in the year ahead.

1. Review Your Financial Health

Take stock of where you stand financially at the start of the year:

Income analysis: Examine your after-tax earnings, investment returns, and passive income sources like dividends or rental properties.
Spending habits: Review your discretionary and essential expenses from 2024. Look for opportunities to trim unnecessary costs or redirect funds to savings and investments.
Savings and debt: Evaluate your TFSA, RRSP, and taxable accounts. Identify any lingering debt, including mortgages, lines of credit, or personal loans.

This analysis serves as a foundation to refine your financial strategy for 2025.

2. Set SMART Financial Goals

Using the SMART framework ensures your goals are practical and achievable:

Specific: Define exactly what you want to achieve, such as "Fully fund my 2025 TFSA contribution by April."
Measurable: Attach clear metrics to your goals, like “Save $12,000 for a milestone anniversary trip.”
Achievable: Consider your current financial landscape and align your goals with your capacity to meet them.
Relevant: Prioritize goals that reflect your current life stage, values, and future aspirations.
Time-bound: Establish a clear deadline to maintain focus and accountability.

Examples of SMART Goals:

Max out your 2025 TFSA contribution of $7,000 by June.
Pay off $10,000 of your home equity line of credit by December.
Save $4,000 for a family getaway by October.
Build an emergency fund of $15,000 by July to enhance financial security.

3. Adjust Your Budget for 2025

Refine your budget to reflect both past spending patterns and new priorities:

Focus on essential expenses (housing, insurance, and utilities) while scrutinizing discretionary costs (streaming subscriptions, memberships).
Automate savings and investment contributions to align with your goals.
Use budgeting tools like the Government of Canada’s Budget Planner or financial apps such as Mint or YNAB for streamlined tracking.

Quick Adjustments:

Cancel underused subscription services.
Explore tax-saving opportunities through eligible medical expenses, charitable donations, or pension credits.
Consider consolidating higher-interest debts into a lower-rate line of credit or personal loan.

4. Maximize Canadian Financial Resources

Take advantage of the tools and programs available to Canadians:

TFSA: Continue leveraging this tax-free savings vehicle for medium- and long-term goals.
RRSP: Maximize contributions for tax savings while planning withdrawals strategically as you approach retirement.
RESP: If your children are still in school, use the CESG grants to grow their educational savings.
Spousal RRSP: Optimize retirement savings and minimize household tax liabilities.

5. Monitor and Adjust Your Progress

Stay engaged with your financial goals throughout the year. Review your progress quarterly and make adjustments as needed for unexpected events, such as changes in income or market fluctuations. Consider working with an investment advisor to refine your strategy and stay on track.

Final Thoughts
As you embark on 2025, setting SMART financial goals and leveraging Canadian-specific tools can position you for continued success. Whether you’re optimizing your investments, planning a special milestone, or preparing for the future, deliberate steps will help you turn your vision into reality.

Here’s to a prosperous and fulfilling 2025!

Source:www.mcleans.ca

Health & Wellness: How Much Sugar is Too Much?

laura@rightdirectionfinancial.com (Laura Chanin) — Mon, 30 Dec 2024 22:14:40 GMT

A Guide to Understanding and Managing Your Sugar Intake

How much sugar is too much?

Understanding Sugar:

Sugars are carbohydrates that provide energy. They occur naturally in foods like fruits, vegetables, and dairy. However, "added sugars" are those introduced during food processing or preparation, including sweeteners like honey or maple syrup.

The numbers are in. These percentages show the beverage and food categories from which we consume added sugar:

Sugar-sweetened beverages – 24 %

Soft drinks – 16%
Fruit drinks – 5%
Sport/energy drinks – 2%
Other sources – 1 %

Desserts and sweet snacks – 19%

Cookies and brownies – 6%
Ice cream and frozen dairy desserts – 5%
Cakes and pies – 4%
Doughnuts, sweet rolls and pastries – 3%
Other sources -1%

Other sources 19%

Coffee/tea – 11%
Candy – 9%
Sandwiches – 7%
Breakfast cereals and bars – 7%
Higher fat milk and sweetened yogurt – 4%

Recommended Limits:

The Heart and Stroke Foundation of Canada suggests that added sugars should make up less than 10% of your daily calorie intake, aiming for below 5% if possible. For someone consuming 2,000 calories daily, that's about 48 grams (12 teaspoons) at the 10% level. To put it in perspective, a single can of pop contains roughly 85% of this daily limit.

Identifying Added Sugars:

When shopping, check the Nutrition Facts table on food labels. Manufacturers list added sugars under "Total Sugars," making it easier to monitor intake. Be aware of various names for added sugars, such as honey, maple syrup, and high fructose corn syrup.

Tips to Reduce Sugar Intake:

Limit Sugary Drinks: Beverages like soft drinks and sweetened coffees are major sources of added sugars. Opt for water, herbal teas, or milk instead.
Choose Whole Foods: Fruits, vegetables, and whole grains provide natural sugars along with essential nutrients and fiber.
Read Labels: Look for products with little to no added sugars. Ingredients are listed by quantity, so if sugar is among the first few items, the product is likely high in added sugars.
Cook at Home: Preparing meals allows you to control the ingredients and reduce added sugars.

By being mindful of your sugar intake and making informed choices, you can enjoy a balanced diet that supports your health.

source: www.https://www.healthline.com/nutrition

2024 Economic Growth, 2025 Economic Forecasts, and Stock Market Performance

laura@rightdirectionfinancial.ca (Laura Chanin) — Mon, 30 Dec 2024 22:14:37 GMT

As we look back at 2024 and ahead to 2025, the economic forecasts suggest a landscape of moderate growth with regional variations.

Here’s a breakdown of Canada, the U.S., and the rest of the world:

Canada

2024 Economic Growth:

GDP Growth: A paltry1.2% in 2024, primarily driven by consumer spending on services and investments in technology and infrastructure. However, economic growth slowed toward the latter part of the year due to rising unemployment and higher interest rates.
Key Trends: Resilience in sectors like healthcare, real estate, and technology.

2025 Economic Forecasts:

GDP Growth: Projected at 1.7%, showing a modest recovery. British Columbia and other resource-rich provinces may see stronger-than-average growth.
Key Factors: Immigration policies and housing challenges are expected to moderate potential growth.

2024 Stock Market Performance:

The S&P/TSX Composite Index rose approximately 18.3% , hitting record highs, driven by strength in energy and financial sectors.

United States

2024 Economic Growth:

GDP Growth: Estimated at 2.7%-2.8% , reflecting strong consumer spending and labor market conditions.
Key Drivers: Continued investment in technology, AI, and clean energy.

2025 Economic Forecasts:

GDP Growth: Projected at 2.0% , reflecting a "soft landing" with the economy stabilizing after aggressive rate hikes in 2023 and early 2024.
Key Factors: Easing inflation and resilient consumer spending are expected to drive moderate growth.

2024 Stock Market Performance:

S&P 500 Index: Gained 26% , supported by strong corporate earnings in technology and healthcare.
Nasdaq-100 Index: Closed the year at a record 21,780.25 , highlighting tech sector dominance.

Rest of the World

2024 Economic Growth:

Global GDP Growth: Estimated at 3.2% , with emerging markets, particularly in Asia, leading at around 4.0% growth .
Regional Insights: Europe faced slower growth due to energy challenges, while China’s recovery remained subdued.

2025 Economic Forecasts:

Global GDP Growth: Projected at 3.0% , with stronger performance expected in Asia. Emerging markets are anticipated to benefit from investments in digital infrastructure and clean energy.

2024 Stock Market Performance:

Global Equities:
Emerging markets returned 9.6% , led by gains in technology and infrastructure development.
European markets underperformed, reflecting lingering economic stagnation and energy disruptions.

Key Takeaways for Investors:

Diversification is essential given regional disparities in growth and market performance.
Focus on sectors like technology, healthcare, and clean energy , which are expected to remain strong into 2025.
Canadian professionals and investors should watch U.S. economic developments closely due to integrated market dynamics.

Source: https://www.investopedia.com/

Death & Taxes

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 12 Dec 2024 21:39:41 GMT

Death and Taxes: Navigating Life's Certainties in Canada

There’s an old adage that says only two things in life are certain: death and taxes. While it may seem grim, understanding these inevitable aspects is crucial for Canadians looking to manage their finances and legacies effectively. Whether you're preparing for estate taxes or organizing your will, this article will guide you through what every Canadian should know about death and taxes.

Canadian Tax System: What Happens After Death?

When someone passes away in Canada, their estate must go through a process to settle taxes owed. Unlike some countries, Canada doesn’t impose an inheritance tax, but that doesn’t mean taxes are completely avoided. Here’s what to expect:

Final Tax Return (T1 Terminal Return):

A final tax return must be filed on behalf of the deceased. This includes all income earned up to the date of death, such as employment income, pensions, RRSPs, or investment income.

Capital Gains Tax:

In Canada, when a person dies, it is assumed (for tax purposes) that they sold all of their assets at fair market value just before death. This can trigger capital gains taxes, especially on investments, properties, or valuable assets like art or real estate.

RRSPs and Taxes:

Registered Retirement Savings Plans (RRSPs) are fully taxable as income upon death unless they are rolled over to a spouse or dependent child. Understanding how this affects the estate is vital for tax planning.

Probate: Fees and What to Expect in Canada

Probate is the legal process of validating a will and distributing assets, and it comes with a fee. These fees vary by province but typically range from 0.5% to 1.5% of the estate's total value. Understanding how probate works in your province can help you minimize fees and ensure a smoother transition for your loved ones.

Estate Planning to Minimize Taxes

To help ease the tax burden on your beneficiaries, consider these estate planning strategies:

Joint Ownership :

Holding assets like real estate or bank accounts in joint ownership can bypass probate fees and simplify asset transfers.

RRSP Rollovers and TFSAs :

Rolling over RRSPs to a spouse or dependent can defer taxes, and transferring Tax-Free Savings Accounts (TFSAs) maintains their tax-exempt status for beneficiaries.

Gifting During Lifetime :

Gifting assets to loved ones during your lifetime can reduce the value of your estate and the associated taxes, though it’s important to understand potential tax consequences, especially for large gifts.

Provincial Differences in Estate Laws

While the overall tax structure is consistent across Canada, probate laws and fees vary by province. For instance, Ontario has some of the highest probate fees, while Quebec operates differently, without requiring probate in certain cases. Understanding the nuances of your province can help in estate planning.

Resources for Canadians: Where to Get Help

Navigating the complexities of death and taxes can be overwhelming.

Thankfully, there are resources to help:

Financial Planners : Specializing in estate planning and tax strategies.

Lawyers : Assisting with wills, probate, and legal obligations after death.

Government Resources : The CRA offers guides for estate administrators and tax filers to ensure everything is handled properly.

Conclusion

While death and taxes are unavoidable, having a plan in place can ease the burden on your loved ones and ensure your wishes are respected. By understanding Canada’s tax laws and taking proactive steps, you can make life’s certainties more manageable.

Source: www.canada.ca

2024 Year End Checklist

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 12 Dec 2024 21:39:39 GMT

2024 Year End Checklist

Optimize Contributions to Registered Accounts:

Quarterly Tax Instalments:

Confirm your payments are up to date to avoid interest and penalties.

By December 31, 2024

Tax-Free Savings Account (TFSA):

Maximize the 2024 contribution limit of $7,000. Verify unused room with the Canada Revenue Agency (CRA), as unused amounts carry forward indefinitely.
If planning to withdraw funds soon, consider doing so before year-end. Withdrawals made in 2024 will restore contribution room on January 1, 2025, allowing for early replenishment.

Registered Retirement Savings Plan (RRSP):

Evaluate whether to contribute or withdraw based on your tax bracket. If income is unusually low, strategic withdrawals can reduce future tax exposure while qualifying for pension income splitting or the $2,000 pension tax credit (if aged 65+).
If turning 71, convert your RRSP into a Registered Retirement Income Fund (RRIF) before year-end. Use a younger spouse's age to minimize mandatory withdrawals.

By March 3, 2035

Maximize your 2024 deductions with contributions up to $31,560 or your limit.
HBP/LLP Repayments: Meet minimum repayment amounts to avoid taxable income

First Home Savings Account (FHSA):

Contribute up to $8,000 to deduct it on your 2024 tax return. Unused contribution room carries forward, but opening the account by December 31 ensures you can use up to $16,000 next year.
If you've purchased a first home using an FHSA withdrawal, ensure all accounts are closed by December 31. Remaining funds can be rolled into an RRSP/RRIF without affecting contribution room

Registered Education Savings Plan (RESP ) and Registered Disability Savings Plan (RDSP):

Contribute to leverage grants or bonds. RESP contributions attract a 20% Canada Education Savings Grant (CESG) on up to $2,500 annually. RDSP contributions may qualify for the Canada Disability Savings Bond.

Capital Gains and Losses by December 30 ^th , 2024

Realize capital losses to offset taxable gains. Losses can carry back three years or forward indefinitely. Selling investments strategically by year-end helps manage taxable income.
Trigger gains, apply losses, or claim a capital gains reserve if beneficial.
Utilize the 50% inclusion rate for up to $250,000 in net capital gains realized between June 25 and December 31, 2024. Above $250K, the inclusion rate is 66.7%

Charitable Donations:

Donate publicly traded securities directly to charities to eliminate the capital gains tax on appreciated assets.
Plan donations with the alternative minimum tax (AMT) in mind. For 2024, AMT limits donation tax credits to 80% of the amount available under regular tax rules and includes 30% of capital gains from donated securities in taxable income calculations

By January 31, 2025

Eligible Expense Deductions:

Prepay deductible expenses like medical costs, childcare fees, or investment management fees. These reduce taxable income for 2024 when claimed.

Income-Splitting Loan Interest: Ensure accrued interest on loans is paid to avoid attribution rule

For Business Owners:

Review salary or dividend strategies to optimize taxes. Ensure sufficient salary is paid to maximize RRSP contribution room for 2025 (based on 2024 earned income).
Pay salaries, bonuses, or other expenses before year-end to deduct them in 2024. Small business owners should confirm eligibility for the $500,000 small business deduction.

Estate Planning:

Ensure wills, powers of attorney, and beneficiary designations are up-to-date. Address any changes in family circumstances, tax laws, or asset distributions.
Plan RRSP or TFSA beneficiary designations to minimize taxes or delays for heirs.

Miscellaneous Considerations:

U.S. Residents or Cross-Border Individuals: If applicable, coordinate tax planning to address IRS requirements, foreign income exclusions, or tax treaty benefits.
Family Loans: Ensure interest payments on intra-family loans (e.g., income-splitting arrangements) are made by January 30, 2025, to avoid attribution rules.
For Trustees: Decide by year-end whether trust income should be distributed or retained. Prepare for enhanced trust reporting rules, with exemptions for some bare trusts until 2025.
For Residential Property Owners: If you're not a Canadian citizen or permanent resident, confirm compliance with the Underused Housing Tax (UHT). Returns are due April 30, 2025.

Actionable Steps:

Schedule a meeting with your financial advisor and tax professional to identify personalized strategies.
Review deadlines for processing contributions, withdrawals, or donations—some institutions may need several business days to complete transactions.
Maintain thorough records to support tax claims.

By addressing these areas before December 31, you'll position yourself for a stronger financial start to 2025.

Laura

Source: www.canada.ca

November Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 07 Nov 2024 23:33:03 GMT

How will the US election results impact your investments?

With the US election day over, many are reflecting on what this new leadership might mean for their financial investments. Many Canadians are not happy about the results. However, for our investments, its important to remember that stock markets have been influenced more by economic fundamentals than by which party is in power.

As this chart shows, while the stock market has fluctuated under presidents of both parties, the S&P 500 has trended higher over the long term, no matter who’s sitting in the Oval Office

● Long-Term Trends: The stock market, as represented by the S&P 500, has generally trended higher over the long term, regardless of which party holds the presidency.

● Company Growth: The dynamic U.S. economy has consistently produced successful companies, contributing to economic strength under various administrations.

● Market Priorities: Factors like earnings growth, economic conditions, and technological advancements can have more influence on market performance than political changes.

● Investor Focus: Your investment strategy should align with your goals, time horizon, and risk tolerance—not the outcome of a single election.

Some predictions (and remember most predictions are wrong) are that under a Trump presidency the US economy should be strong because there will be less regulation and lower taxes. However, with increased tariffs, costs will likely increase as will inflation, interest rates and the US dollar.

While elections do have consequences, it’s important to try to keep perspective. We will be closely monitoring how the new administration's agenda might impact areas like tax policy, regulations, and corporate competitiveness. Market reactions to political shifts can create short-term volatility, but these fluctuations can be temporary.

As always, the key is to stay focused on your financial goals. Sudden moves in response to short-term events might be more detrimental than beneficial. We’re here to help you navigate any uncertainty while pursuing your overall financial strategy.

If you have questions about how current events could impact your investments or want to discuss your financial strategy, feel free to reach out.

Here are the market returns to Nov 7:

Market:

YTD S&P 500 (US): 25.2%

TSX/S&P (Canada): 18.6%

Source: Bloomberg.com

October Market Insights

laura@rightdirectionfinancial.ca (Laura Chanin) — Sat, 12 Oct 2024 03:15:37 GMT

Key Takeaways from Breakfast with TD Bank's CIO: Economic Trends and Market Outlook

I had breakfast with the Chief Investment officer David Sykes of TD Bank last week and here is a summary of his comments.

The first comment is that no one can predict the future for the economy, markets, etc. We all make our best guesses, but so much is out of our control, and there are many influences. If someone tells you what they ‘know’ is going to happen, they are typically wrong!

Canada has done a good job of reducing inflation. If we exclude rent and mortgage payments, year over year it is up 0.5%, so very low, and our unemployment rate is creeping up and is now 6.6%. It’s possible the Bank of Canada will do a bigger rate cut at their next meeting. They are lowering interest rates to try to stimulate the economy and keep things growing. All banks expect there to be continued cuts by the Bank of Canada, and interest rates should be lower next year, which is good if you have a renewing mortgage or a line of credit.

In the US, their inflation is 2.5% headline and 2.7% core. Goods inflation (stuff) has decreased, but there are still higher prices around services.

Around the world, central banks are cutting interest rates, and the US Federal Reserve did their first 0.5% cut. Their next meeting could also have them cutting their central interest rate further.

The US economy continues to grow; there are no signs of a recession, so they appear to be having a soft landing—growth is slowing but still positive. Their unemployment rate is 4.4%. It may be that during COVID, a lot of folks received payments that they saved and are now spending this money. Seventy percent of the US GDP is from people spending.

At the same time, corporate profits are increasing (as inflation and interest rates are decreasing), which is a good setup for stocks. Earlier this year, the technology/AI stocks were the strong gainers, but now there is a rotation for more companies to have their stock prices increase.

In the Canadian real estate market, there is still a major supply issue. It’s very costly to build with the permits, taxes, and fees, which discourages developers, and we continue to grow our population.

The US election doesn’t really have as much of an impact on the stock market as you would think. Markets prefer a divided Congress.

What is a concern, which isn’t discussed much, is the level of debt the US (and Canadian) governments have.

The outlook is pretty positive for stocks as long as unemployment stays relatively low and corporate profits continue to grow. Bonds are also decent as their interest rates/yields are higher than they have been.

Here are the year to date performance numbers:

TSX/S&P (Canada): 17.72%

S&P500 (US): 21.9%

Canada Aggregate Bonds: 2.4%

Sources: Ycharts

TD Asset Management

When a Family Member is Diagnosed with a Terminal Illness

laura@rightdirectionfinancial.ca (Laura Chanin) — Sat, 12 Oct 2024 03:15:34 GMT

When a family member receives a terminal illness diagnosis, it impacts not only their health but also many aspects of life, including financial stability.

The complexity of these issues can be overwhelming, making it vital to have a well-organized plan. Here are some considerations in this situation, particularly when a spouse is diagnosed with a terminal illness.

1. Adjusting Cash Flow to Meet Financial Needs

A terminal illness can greatly affect a family's financial situation. It's important to explore various options to enhance cash flow:

Life Insurance Proceeds: Consider options like accelerated death benefits or life settlements from existing life insurance policies. These can provide funds while the spouse is still alive to cover immediate expenses, but careful evaluation is crucial.
LIFs and Pensions: In some provinces, funds can be 'unlocked' with reduced life expectancy.
Long-Term Care Costs: If long-term care becomes necessary—whether in a nursing home or through home health care—it’s essential to assess the financial impact on cash flow and assets.

2. Estate Preparation

Financial burdens can be alleviated during difficult times by ensuring that you have comprehensive estate planning documents in place.

Updated Will or Trust: If these documents are outdated or missing, it’s essential to prompt immediate action while you can.
Powers of Attorney & Advance Care Directive/Representation Agreement: A general and healthcare power of attorney allows the spouse to designate someone to act on their behalf if they become incapacitated. A representative agreement specifies their preferences for end-of-life care.

Key Estate Planning Questions to Consider:

Estate Tax Planning: In Canada, there is no federal estate tax or gift tax as seen in some other countries. However, it's important to understand that when a person passes away, their estate may be subject to income taxes including capital gains tax on appreciated assets. This means that any increase in the value of assets from the time they were acquired until the time of death may be taxed as income. There are also probate fees on anything that flows through the will.
Gifting Strategy: While Canada doesn't have a gift tax, gifts made within a certain timeframe before death can be subject to deemed disposition rules, triggering capital gains tax. Therefore, gifting strategies should be carefully considered in light of potential tax implications.
Beneficiary Designations: Ensure that beneficiary designations for all accounts, retirement plans, and life insurance policies are current and up to date.
Account Titling: Revising the titles of investment and bank accounts is a crucial step in estate planning.

CRA Tax Installments Explained

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 11 Sep 2024 19:47:32 GMT

Several clients have been getting some unwelcomed mail from the CRA, asking for tax installments.

What are they?

CRA tax installments are periodic payments made to cover your income tax obligations throughout the year. These installments are usually required if you owe more than $3,000 for 2 previous years in taxes on income that doesn't have tax withheld, such as self-employment income, rental income, investment income, or certain pension payments.

When Do You Pay CRA Tax Installments?

The CRA typically sends installment reminders if you need to pay. Here are the key points:

Installment Due Dates:

Installments are usually paid quarterly, with due dates on March 15, June 15, September 15, and December 15 each year.
If a due date falls on a weekend or holiday, the payment is due the next business day.

How Much to Pay:

The CRA provides an installment payment schedule based on your tax return from previous years.
You can also calculate your own installment payments if you expect your income to be significantly different from the previous year.

How to Pay:

Payments can be made online through your bank, by mail, or through pre-authorized debit.
You can also pay through CRA My Payment, which allows direct payment using Interac or credit card.

Penalties:

If you don’t make your installment payments on time, the CRA may charge interest on the unpaid amounts. Additionally, if you underpay, you could also face penalties.

Paying your taxes through installments helps manage your cash flow throughout the year and avoids a large tax bill when you file your tax return.

I have to pay installments so I understand the pain, but it is easier than coming up with a large tax payment in April. You can look at it this way – if you were an employee you’d be paying tax monthly to CRA, so it is similar.

Source: www.canada .ca

Stock Market Update: September

laura@rightdirectionfinancial.com (Laura Chanin) — Wed, 11 Sep 2024 19:47:21 GMT

September 2024

As of September 10, 2024, both the U.S. and Canadian stock markets are experiencing a combination of resilience and volatility, influenced by economic factors such as inflation, interest rates, and sector-specific trends.

U.S. Stock Market

S&P 500: The S&P 500 has risen by 19.5% year-to-date, benefiting from tech sector strength earlier in the year. Recently, other sectors have contributed to market growth, as the Federal Reserve hints at a potential pause or reduction in interest rates in response to softer labor market data and inflation stabilization.
Technology & Communication Sectors: Although these sectors were key drivers in the first half of 2024, growth has moderated somewhat. Investors are cautious about potential rate cuts and the impact on corporate earnings.
Outlook: Analysts are generally optimistic, but there are concerns about slower job growth and the broader economic cooling. Rate cuts could further support equities, but uncertainty remains

Canadian Stock Market

S&P/TSX Composite Index: The Canadian market has experienced mixed results, driven by the performance of the energy and mining sectors. Energy stocks like Canadian Natural Resources (-3.70%) and Suncor (-3.23%) have seen declines, as oil prices have come under pressure
Gold and Mining: The mining sector, especially gold companies like Kinross Gold (+5.93%), has performed well, benefiting from rising gold prices amidst global uncertainty
Outlook: The Bank of Canada's potential interest rate cuts by year-end may provide relief to certain sectors, particularly real estate and financials. However, inflation control and economic growth remain concerns. Energy sector volatility could continue depending on oil price trends

Overall Outlook

Both U.S. and Canadian markets are facing economic headwinds, but there is cautious optimism driven by expectations of interest rate reductions. The U.S. market remains stronger overall, while the Canadian market is heavily influenced by commodity prices and energy sector trends. Going forward, market performance will likely hinge on central bank decisions and global economic stability.

Source: www.bloomberg.ca

What is Your CPP Strategy?

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 07 Aug 2024 23:05:57 GMT

Making the most of your CPP (& OAS)

Making your CPP and OAS at the wrong time can end up costing you thousands of dollars.

Many people plan to start their CPP and OAS at age 65 simply because they want to get the government money as soon as possible. But there's a smarter way to go about it.

Let’s take J and M as an example, longtime clients of ours.

J and M were a typical middle-class couple. They raised two kids, helped them through university, and paid for both weddings. Money was tight when their kids were young, but as empty nesters, J and M managed to save a considerable amount. By the time they were 57, they had plans to work for another three years, both holding jobs with government agencies that offered defined benefit pensions. They had also saved $485,000 in their RRSPs.

When they came to me for retirement income advice, we created a plan that had them using up 100% of their RRSPs from ages 60 to 70, delaying their CPP and OAS until age 70. This strategy provided the necessary income for their travel and retirement goals and leveled out their cash flow. By utilizing their TFSA, we created a tax-efficient income for larger one-time purchases like a new car or a new roof.

Delaying their CPP and OAS saved J and M over $35,000 in taxes over ten years and gave them an extra $6,000 per year on top of those tax savings. Now, they enjoy annual vacations funded by these savings and the increase in their income.

So, when can you take your government benefits?

CPP:

You can start your CPP as early as 60 or delay it until 70.
For each month you take your CPP before age 65, your pension amount reduces by 0.6%. If you start at 60, that’s a total reduction of 36%.
Conversely, if you delay past 65, your benefit increases by 0.7% per month. Waiting until 70 means a 42% increase!

OAS:

You can start OAS at 65 or delay it until 70, with a 0.6% increase for each month you delay past 65.

Why Wait to Take Your Income?

Many wonder if they should take CPP at 60, invest it, and then draw on it later. While that’s a valid point, if you live past age 73, it’s better to wait. Here’s the math, assuming a CPP of $1,000 per month at 65 and living to age 85:

Age 60: $640 per month ($1,000 x (1.0 - 0.36)) x 12 months x 25 years = $192,000
Age 65: $1,000 per month x 12 months x 20 years = $240,000
Age 70: $1,420 per month ($1,000 x (1.0 + 0.42)) x 12 months x 15 years = $255,600

This strategy can make you $63,600 more, but there’s even more to consider.

Integration with Other Income and Benefits:

OAS can be reduced or eliminated based on your total income. Efficient planning is crucial if you have a TFSA, RRSP, pension, etc. Your marital status also makes a difference. Everyone’s scenario, goals, and income needs vary, so there’s no one-size-fits-all answer.

We look at your overall picture, needs, and tax rates to create a personalized plan. It could involve an RRSP drawdown, a bridge offset, or considering family longevity to strategize around life expectancy.

Here is a CPP benefit calculator tha t compares the value of CPP benefits if you take them earlier or later.

Source: www.Canada.ca

Corrections Are Normal

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 07 Aug 2024 21:10:29 GMT

Wow, things took a turn quickly, didn't they?

It’s been a rocky few weeks.

There’s been more recent volatility in the markets, that we haven’t seen a lot of in 2024, but this it is normal.

If you look at this chart from 1929 to now, most of the time markets are going up (bull market), but we do have occasional down ones

Every year there typically there is a sell off in the market, but 75% of the time markets turn out positive.

The best thing to do, as long as you have good investments is to stay the course, because literally no one can time the market.

And if you miss a few good days, you miss out hugely on returns.

We are focused on qualify consistent investments. And the market does periodically seem illogical but over the long term, good companies go up in value.

You can see that during market dips, smart investors such as institutions i.e. Canada Pension plan would increase their stock holdings, which is the opposite of what individual investors might do.

And who has the better track record?

Please reach out if you have any questions

Source:

https://fmgsuite.com/insights

https://www.visualcapitalist.com/chart-timing-the-market/

https://www.goldm ansachs.com/

https://www.bloomberg. com/

3 Stocks Drive 49% of the S&P 500 Gains in 1H of 2024

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 07 Aug 2024 19:37:18 GMT

What do NVIDIA, Alphabet, and Microsoft have in common?

Maybe you have heard of the "Magnificent Seven" stocks. We're talking about Apple (AAPL), Amazon (AMZN), Alphabet (GOOG, GOOGL), Meta Platforms (META), Microsoft (MSFT), NVIDIA (NVDA), and Tesla (TSLA). Collectively, these seven companies are up 31% in the first half of 2024, compared to a modest 7.4% for the rest of the S&P 500, often dubbed the "S&P 493."

The overall S&P 500 has risen by 14.5% so far.

But here's the kicker: NVIDIA, Alphabet, and Microsoft alone have surged by 49.3% from January to June 2024, adding around $2.85 trillion in market cap. This means these three companies contributed to 49% of the S&P 500’s total market cap gains, which amounted to $5.8 trillion in the first half of the year. Collectively, the Magnificent Seven stocks accounted for 64.3% of the S&P 500’s market cap growth.

So, with these large-cap stocks growing even larger, it raises a big question: How concentrated is the U.S. stock market, and will these few names continue to dominate the broader indices?

Let's break it down a bit more. The biggest winner among the Magnificent Seven was NVIDIA, skyrocketing 150% in the first six months of 2024 and surpassing a $3 trillion market cap for the first time, joining Apple and Microsoft in the $3 trillion club as of June 5, 2024.

On the flip side, Tesla was the only one in the group that performed negatively, dropping 20.4% and losing $159 billion in market cap.

As of June 2024, the top 10 stocks make up 35.8% of the entire U.S. stock market. Looking back, the S&P 500 has become more concentrated at the top over the last five years. For instance, in June 2019, the top 10 stocks represented 21.6% of the index, but now six of those names have remained in the top 10.

When comparing market cap-weighted indices to equal-weighted ones, the concentration becomes more apparent. The S&P 500 is a market cap-weighted index, meaning each stock's weight is based on its total market cap.

Advantages of a Market Cap-Weighted Index:

Reflects the overall market movements and investor sentiment.
Requires less frequent rebalancing since the market naturally adjusts the weights.

Disadvantages of a Market Cap-Weighted Index:

Poses concentration risk where a few large companies can dominate the index.
Exhibits momentum bias, allocating more to stocks that have risen in value, which can mean buying high and selling low.

For those looking to diversify, alternatives like the Invesco S&P 500 Equal Weight ETF (RSP) offer a different approach. The performance of RSP versus SPY (the SPDR S&P 500 ETF) for the first half of 2024 shows how equal-weight funds can limit exposure to dominant stocks like the Magnificent Seven, although this strategy has had mixed results in limiting downside over the past five years.

Below is a Scatter Plot and table showing the first half of 2024 returns for each of the Magnificent Seven stocks, along with the S&P 500, in addition to their respective market capitalizations as of the end of Q2:

Will the U.S. stock market become more concentrated?

Historical trends suggest it could. The S&P 500’s concentration among the top 10 stocks has doubled over the last decade, with a significant acceleration in recent years. To hedge against the risk of over-concentration, consider investing in an equal-weight fund or index with reduced exposure to mega-cap names.

Represented by SPY, the SPDR S&P 500 ETF, the top 10 stocks comprised 21.6% of the index as of June 2019. Six names have been in the top 10 for the last five years:

This strategy can help avoid "putting all your eggs in one basket," providing some protection if any of these major companies face downturns.

Source: https://get.ycharts.com/resources/blog/how-3-stocks-drove-half-of-the-us-market-gains-in-1h-2024/#:~:text=However%2C%20NVIDIA%2C%20Alphabet%2C%20and,of%20the%20index's%20total%20gains.

Health & Wellness: Controlling Anxiety & Stress

leslie@rightdirectionfinancial.ca (Leslie Sommer) — Wed, 17 Jul 2024 21:47:01 GMT

Controlling Anxiety and Stress

We've all had those days at work where everything seems to be going wrong.

You're running late, you're stressed, and just thinking about your next meeting or conversation with a colleague can fill you with anxiety. It's like your brain is on high alert, making it hard to calm down and refocus.

It's tempting to try to shake off the negative thoughts by telling yourself to "just focus on the positive" or "reframe" your thinking. But when you're already feeling overwhelmed, it's hard to do that.

A recent study found that when we're stressed, our brain's "fight or flight" system kicks in, making it harder to control our thoughts and emotions.

So, what can we do when we're feeling anxious and stressed? Instead of trying to control our thoughts, we can try techniques that bypass the part of our brain that's responsible for anxiety.

Mindfulness meditation is one way to do this. It's about acknowledging and accepting our thoughts without judgment, rather than trying to change them.

The idea is to observe your thoughts without getting caught up in them. When anxious thoughts arise, notice them and let them go. Direct your attention to something else, like your breath. It may take practice, but with time, it can become a powerful tool for managing anxiety.

If you're having one of those stressful days at work and need to face a potentially anxiety-provoking meeting, try taking a few minutes to breathe deeply and focus on the present moment. It may be just what you need to reset your brain's anxiety center and feel more calm and centered.

And lastly, a change of scenery like a walk in the park, some form of exercise you enjoy or reading a book may just be enough to get you back on track.

Source:https://www.helpguide.org/articles/stress/stress-management.htm

Gratitude: How it affects your health

leslie@rightdirectionfinancial.ca (Leslie Sommer) — Thu, 11 Jul 2024 23:18:15 GMT

Want to live longer? Try a little gratitude.

In the Canada, supporting healthy aging is a major public health goal.

Gratitude, a psychological factor that can potentially be cultivated, might play a crucial role in enhancing the health and well-being of older adults. Surprisingly, though, its link to mortality hasn't been thoroughly explored.

So, the objective of this study was to investigate exactly that—how gratitude relates to overall and specific causes of mortality in later life. The research used data from nearly 50,000 older female registered nurses in the Nurses’ Health Study, collected from 2016 to 2019. They answered questions about gratitude levels and provided information through medical records.

Researchers used statistical models to analyze the data, adjusting for factors like demographics, social engagement, physical health, lifestyle, cognitive function, and mental well-being. Over the study period, which spanned from late 2022 to early 2024, they tracked deaths using various sources, including official records and family reports.

What they found was intriguing: participants who reported higher levels of gratitude tended to have lower risks of dying, across the board. For instance, those in the highest category of gratitude had a significantly lower risk of death from any cause compared to those with the lowest gratitude levels.

When looking specifically at cardiovascular-related deaths, gratitude was again linked to a reduced risk, suggesting it might have protective effects on heart health.

In conclusion, this study offers initial evidence suggesting that feeling grateful could potentially increase longevity among older adults. However, the findings will need further confirmation through studies involving broader and more diverse populations.

So, what do you think about how gratitude might influence our health as we age?

Source: https://jamanetwork.com/journals/jamapsychiatry/fullarticle/2820770?guestAccessKey=e8657bd4-011f-41d6-a7bd-3663158e7e12&

Market Recap: 1st Half of 2024

laura@rightdirectionfinancial.com (Laura Chanin) — Thu, 11 Jul 2024 23:17:01 GMT

Stock Market Performance: First Half of 2024

Canada

In Canada, the S&P/TSX Composite Index increased by approximately 4.4% during the first six months of 2024. This growth was fueled by a rebound in the energy sector and steady performance in financials and consumer staples. Despite some economic headwinds, the Canadian market showed resilience, benefiting from stable commodity prices and a robust job market.

United States

The U.S. stock market has had a stellar first half in 2024. The S&P 500 saw an impressive surge of over 14%, driven by optimism around potential interest rate cuts, favorable economic data and strong performance in the technology sector. The Nasdaq also performed well, buoyed by significant gains in AI-related stocks. This marks one of the best first-half performances for U.S. equities in recent years.

Europe

European stock markets had a mixed but generally positive performance in the first half of 2024. The MSCI Europe Index, which tracks stocks across 15 developed European countries, rose by around 5.7% in dollar terms. This increase reflects solid economic fundamentals and positive investor sentiment. The UK’s FTSE 100, Germany’s DAX, and France’s CAC 40 all saw moderate gains, supported by strong corporate earnings and improving economic conditions across the continent.

General Insights

Globally, stock markets are being shaped by inflation trends, central bank policies, and geopolitical events.

In the U.S., discussions around interest rates are particularly influential. While very large (mega-cap) stocks have driven much of the recent performance, there is an opportunity for broader market gains as the earnings growth gap between the largest companies and the rest of the S&P 500 is expected to narrow later in the year.

Europe’s markets have benefited from stable economic growth and investor confidence, while Canada’s market has been supported by a robust commodities sector. The overall outlook for the remainder of the year remains cautiously optimistic as investors continue to navigate potential economic and political uncertainties.

Investors are advised to remain cautious but optimistic, focusing on sectors poised for growth while keeping an eye on macroeconomic indicators and geopolitical developments that could impact market stability.

Sources: https://ntam.northerntrust.com/

https://www.blackrock.com/us/individual/insights/taking-stock-quarterly-outlook

What Really Is the Alkaline Diet?

Wed, 12 Jun 2024 20:22:56 GMT

The alkaline diet, also known as the alkaline-ash or alkaline-acid diet, has gained a lot of attention thanks to celebrities who have all praised it. But just because celebrities swear by it doesn't necessarily mean it's a one-size-fits-all solution or that it works long-term. In fact, the core ideas behind the alkaline diet may lack solid scientific backing, and for some people, it could even pose health risks.

So, is the alkaline diet good for you? This guide will help you decide if it's something you should try.

What Is the Alkaline Diet?

The idea behind the alkaline diet is that the foods we eat can affect the pH balance of our blood. Remember pH from chemistry class? It's a measure of how acidic or alkaline something is, ranging from 0 (very acidic) to 14 (very alkaline), with 7 being neutral.

Proponents of the diet believe that eating lots of meat and grains and not enough potassium-rich veggies and fruits can throw off your blood's pH balance, leading to health issues. This is called the acid-ash hypothesis, which is why the diet is sometimes called the acid-ash diet.

However, this is just a hypothesis and hasn't been proven. A 2022 review even suggested that the alkaline diet could be harmful because it limits key nutrients like protein and calcium. (1)

While the pH of food might not matter much, the diet does encourage healthy eating habits, like focusing on unprocessed and plant-based foods and cutting back on red meat and refined grains. Some studies suggest this could help lower the risk of hypertension, stroke, and improve overall health.

How Does the Alkaline Diet Work?

The diet categorizes foods based on how much acid they produce when digested. Acid-forming foods lower pH below 7, while alkaline-forming foods raise it above 7. Neutral foods are around 7.

Here’s what the diet recommends:

Avoid acid-forming foods: meat, dairy, fish, eggs, grains, and alcohol.
Eat plenty of alkaline-forming foods: fruits, vegetables, nuts, and legumes.
Limit neutral foods: starches, sugars, and natural fats.

Research shows that the pH of food doesn’t actually impact your body’s overall pH because your stomach, kidneys, and lungs maintain this balance tightly. Your body’s pH levels are strictly regulated, with blood pH ranging from 7.2 to 7.45. Any significant change in pH is due to a serious health issue, not diet.

Potential Health Benefits of the Alkaline Diet

Many claim the alkaline diet can treat diseases like cancer and kidney disease. From a scientific perspective, these claims may not be realistic. However, the focus on healthy foods like fruits and veggies is beneficial, much like the Mediterranean diet.

Bone Health: There's no solid evidence that an acidic diet leads to osteoporosis. High calcium intake seems to matter more.

Cancer Prevention: The diet doesn’t effectively alter the body’s acidity to affect cancer cells. But eating more fruits and veggies and less meat is generally good for reducing cancer risk.

Chronic Kidney Disease: Eating more alkaline foods might benefit those with kidney disease by reducing protein load on the kidneys.

Heart Health: Eating more fruits and vegetables, which are alkaline, can help reduce the risk of hypertension and stroke.

Can the Alkaline Diet Help With Weight Loss?

While weight loss isn’t the main goal, the diet’s emphasis on fruits and vegetables over processed foods can help reduce calorie intake and support weight loss. Some studies suggest that an alkaline diet may help preserve muscle mass, which is important for burning calories.

Alkaline Diet Food List

Here’s what the Alkaline Diet recommends you to eat and avoid:

Avoid Acid-Forming Foods:

Meat, poultry, fish, dairy, eggs, grains, alcohol, soda, lentils, peanuts, walnuts, processed foods.

Limit Neutral Foods:

Natural fats, starches, sugars.

Eat Alkaline-Forming Foods

Fruits, unsweetened fruit juices, non-starchy vegetables, almond milk, mineral soda water, soy foods, almonds, coconut and avocado oils.

Pros and Cons of the Alkaline Diet

A more relaxed version of the diet, which doesn’t strictly eliminate healthy nuts and grains, can be beneficial. The focus on plant-based foods is good for reducing the risk of various chronic diseases. However, the diet can be restrictive and might make you miss out on important nutrients like protein. For most people without preexisting health conditions, the alkaline diet is generally safe, but it might leave you feeling hungry or lacking in protein.

In summary, there’s no scientific evidence that the acidity or alkalinity of foods impacts overall health or weight, making the alkaline diet more pseudoscience than fact. However, its emphasis on reducing processed foods and meats in favor of plant-based foods is sound advice. Always talk to your healthcare provider before starting any restrictive diet to ensure you’re not cutting out essential nutrients or harming your health.

FAQs

Is an alkaline diet good for you?
The alkaline diet hasn't been proven to affect your body's pH, but its focus on plant-based foods is generally healthy.

What foods are the most alkaline?
Fruits, vegetables, and legumes.

How long should I follow an alkaline diet?
There’s no set duration. People usually follow it to feel better, but it doesn’t actually change the body’s alkalinity.

Is alkaline water good for you?
More research is needed. Some claim it helps with heartburn, disease prevention, and bone loss, but evidence is limited.

What can’t you eat on an alkaline diet?
Avoid meat, dairy, eggs, starches, grains, and sugars.

Sources: (1) https://akjournals.com/view/journals/066/51/3/article-p326.xml

https://www.everydayhealth.com/diet-and-nutrition/diet/comprehensive-review-alkaline-diet-what-it-how-it-works-what-eat/

5 Principles of Successful Investing

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 12 Jun 2024 20:22:55 GMT

Investing during volatile times can test your discipline and commitment, but there are some timeless principles that can help you stay focused on the long term and ease your mind.

Here are five key strategies:

1. Think Diversification

It's uncommon for any single investment to consistently be a top performer year after year. By diversifying your investments across different economies, industries, countries, and asset classes, you can spread out the risk. This helps keep your portfolio more stable and reduces the impact of any underperforming assets.

Historical asset class rotation, 2013–2023

Calendar year total returns by class assets (%)

Source: Manulife Investment Management, Bloomberg, as of December 31, 2023. Total returns are shown in local currency or in USD for multimarket indexes.

2. Be Rational, Not Emotional

Investors often get excited during good times and want to invest more, which can lead to buying at high prices. Conversely, during market downturns, fear can drive investors to sell at low prices. Stay disciplined and stick to your long-term investment plan to avoid getting caught up in this emotional cycle.

An Investors Emotional Roller Coaster:

Source: Hays Advisory. This chart is an example and does not represent the performance of any actual investment. This is not meant as investment advice. For illustrative purposes only.

3. Don’t Miss Out on Key Opportunities

Investment success often hinges on being in the market during its best days. If you stay fully invested and don't miss the top 20 investment days over the past 20 years, your investments could more than double.

Source: Manulife Investment Management, Bloomberg, as of December 31, 2023. For illustrative purposes only. The index is unmanaged and cannot be purchased directly by investors. Past performance does not guarantee future results.

4. Look at Long-Term Performance

Understand that markets will fluctuate, but over the long term, they have historically trended upwards. Keeping a long-term perspective can help you stay the course through both crises and opportunities.

Source: Manulife Investment Management, Bloomberg, as of December 31, 2023. For illustrative purposes only. Red circles indicate periods of market decline. The index is unmanaged and cannot be purchased directly by investors. Past performance does not guarantee future performance.

5. Use Market Volatility to Your Advantage

Investing a fixed amount at regular intervals, known as dollar-cost averaging, can help you buy more units when prices are low and fewer when prices are high. This strategy can alleviate the stress of trying to time the market perfectly with a lump-sum investment.

By incorporating these principles into your investment strategy, you can navigate volatile times with greater confidence and focus on achieving your long-term financial goals.

Source: https://www.manulifeim.com/retail/ca/en/viewpoints/investor-education/five-timeless-principles-for-investing-success

What Is the Ideal Retirement Age?

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 12 Jun 2024 20:22:53 GMT

In Canada, the ideal age to retire varies based on factors like financial readiness, health, and personal goals.

But there are some specifics to Canadian retirement benefits that are important to know:

Canada Pension Plan (CPP) Benefits:

Early Retirement: You can start receiving CPP benefits as early as age 60, but your monthly benefits will be reduced by 7.2%/year until age 65.
Standard Retirement Age: The standard age to start receiving CPP is 65.
Delayed Retirement: If you delay receiving CPP benefits until after age 65 (up to age 70), your monthly benefits will increase by 8.4%/year!
Inception: The CPP was established on January 1, 1966.
Purpose: It was created to provide a basic level of earnings-related retirement income to Canadian workers and their families in the event of retirement, disability, or death.

Old Age Security (OAS) Pension:

Eligibility: You become eligible for OAS at age 65 if you meet the residency requirements.
Deferral: You can defer receiving OAS up to age 70, which will increase the monthly amount you receive by 7.2%/year
Inception: The OAS program was introduced on January 1, 1952.
Purpose: OAS is a government-run pension program that provides a monthly payment to eligible Canadians aged 65 and older. Unlike CPP, OAS is not based on your employment history but rather on your age and residency in Canada.

Financial Readiness:

Savings and Investments: Consider if you have enough savings in Registered Retirement Savings Plans (RRSPs), Tax-Free Savings Accounts (TFSAs), or other investment accounts.
Debt: Aim to have major debts paid off by retirement.
Income: Calculate if your income from CPP, OAS, and personal savings will be sufficient to cover your expenses.

Health:

Current Health: Assess your physical and mental health, as it will impact your ability to enjoy retirement.
Healthcare Costs: Factor in potential healthcare expenses, even though Canada has a public healthcare system.

Lifestyle and Goals:

Retirement Activities: Plan for how you want to spend your time in retirement, such as traveling, hobbies, or volunteering.
Personal Fulfillment: Determine if you will find fulfillment in retirement or if you prefer to continue working, even part-time.

Family Considerations:

Dependents: Consider if you have dependents who rely on your income.
Spouse’s Retirement Plans: Align your retirement plans with those of your spouse or partner.

Common retirement ages in Canada range from 60 to 70, with many people choosing to retire around 65. The best age for you depends on your specific financial situation, health, and retirement goals.

Source: www.canada.ca

June Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 12 Jun 2024 20:22:37 GMT

Let's dive into May’s action: U.S. equity indices rebounded from April's losses, and treasury yields dropped. However, on the economic front, the job market softened, and inflation stayed above the Fed's 2% target.

May 2024 Market Summary: Equities Rebound, Persistent Inflation, and Lower Long-Term

Treasury Yields

After a rough April that interrupted a three-month winning streak, equities bounced back in May. The Dow Jones Industrial Average climbed 2.6%, the S&P 500 jumped 5%, and the NASDAQ soared 7%. International stocks (EAFE) were up 4%, and Small Caps edged out Large Caps by 0.3%.

Utilities led the way for the second month in a row, leaping 9% in May. Technology and Communication Services also had strong performances, gaining 7.1% and 7%, respectively. The only sector to take a hit was Energy, which dipped 0.3%.

Equity Performance

In May, we saw both new single-family home sales and existing home sales take a dip. Meanwhile, the median price for existing homes climbed above $400,000. Inflation stayed in the mid-three percent range for the tenth month straight, and the U.S. Producer Price Index (PPI) rose to 2.17%. The unemployment rate inched up to 3.9%, and April's job gains were the lowest in seven months.

Economic Data

Yields on mid- to long-term Treasury bonds dropped in May, while T-Bill instruments saw little change. The 5-year Treasury note had the biggest movement on the curve for the second month in a row, falling by 20 basis points. Other durations, including the 2-year, 3-year, 10-year, 20-year, and 30-year, also saw decreases in double-digit basis points. The yields on 1-month and 3-month T-Bills remained steady.

Off the Charts! Sell in May and Go Away?

You've probably heard the old stock market saying, “Sell in May and Go Away.” This strategy suggests that investors should pull their money out of the market in May to avoid the traditionally weaker performance from May to October.

But how accurate is this advice? Does staying out of the market during these months help or hurt long-term returns? We dug into the data to see if “Sell in May and Go Away” holds any weight.

Here’s a table showing the average S&P 500 returns for each month since 1950:

While it's true that the months from May to October have historically shown lower stock market returns compared to November through April, selling in May and moving to cash for six months each year has resulted in significantly lower annualized returns over the long term. This is mainly because spending less time in the market means missing out on potential gains during those months.

Equity Performance: Stocks Rebound Across the Board

Economic Data Overview: Inflation Persists, Home Sales Decline While Values Rise

Employment and April Economic Data Overview

Employment

April saw the unemployment rate rise slightly to 3.9%, with the labor force participation rate holding steady at 62.7%. Nonfarm payrolls added 175,000 new jobs, the lowest since October 2023 and below the anticipated 243,000.

Consumers and Inflation

U.S. inflation in April was 3.36%, marking the tenth month in the 3-4% range year-over-year (YoY). Core inflation dropped to 3.61%, the lowest since May 2021. The monthly Consumer Price Index (CPI) rose by 0.31%, and personal spending saw a modest increase of 0.20%. The Fed Funds Rate remained unchanged at 5.50% after the latest FOMC meeting on May 1st, 2024.

Production and Sales

The U.S. ISM Manufacturing PMI fell to 48.70 in May, slipping further into contraction territory after a brief expansion in March. The Producer Price Index (PPI) for April rose to 2.17%, marking its first time above 2% since April 2023 and its third consecutive monthly increase. U.S. Retail and Food Services Sales were flat month-over-month (MoM).

Housing

New single-family home sales dropped 4.7% in April, while existing home sales declined 1.9% MoM. Despite the decrease in demand, the median sales price of existing homes rose 3.7% to $407,600. Mortgage rates saw a slight decline in May, with the 15-year mortgage rate at 6.36% and the 30-year mortgage rate at 7.03%.

Commodities

Gold prices inched up to $2,348.30 per ounce by May 31st. Crude oil prices fell, with WTI down 3.1% to $80.90 per barrel and Brent down 7.8% to $81.34 per barrel. Consequently, the average price of gasoline dropped by 8 cents to $3.70 per gallon.

Cryptocurrencies

Cryptocurrencies bounced back in May. Bitcoin increased by 7.2% to $68,372, and Ethereum surged 16.7% to $3,749. Year-to-date, Bitcoin is up 61.9%, and Ethereum has risen 63.4%.

Source: https://get.ycharts.com/resources/blog/monthly-market-wrap/

Helping Your Adult Children Build Financial Independence

Mon, 13 May 2024 19:06:25 GMT

Watching your kids grow up and become independent is pretty exciting stuff. But let's face it, getting them ready to handle their finances as adults? That's a whole different ball game. With the cost of living always on the rise, it's becoming common for kids to stick around at home longer, or even boomerang back home after tasting a bit of the real world. And let's not kid ourselves, this financial juggle can hit every household differently.

So, if you're a parent or caregiver guiding your adult kid through the financial jungle, here are some tips to consider. Just like in their younger days, you can offer them the love and support they need to stand strong on their own two financial feet.

Now, let's talk about the good and the not-so-good when younger adults move back home:

The Upside:

Everyone chips in with household chores and whatnot, making life a bit easier for everyone.
Living together can stave off loneliness and make taking care of family easier.
Your kids can learn the ropes of independence bit by bit, all while having the safety net of home.
Pooling resources can ease the financial squeeze for everyone.

The Downsides:

Supporting adult kids can strain your own finances and put a dent in your retirement savings.
More people means more expenses, from utility bills to groceries.

In Canada, about a third of young adults are bunking up with mom and dad, especially in pricey cities like Vancouver.

Now, let's talk survival tactics when you've got adult kids under your roof:

Lay down some ground rules. Everyone pitches in, and it's important to have an open chat about who does what.
Have some grown-up talks about money. Show them the household budget and figure out how they can chip in.
Think about asking them to pony up some rent. Even if you don't need the cash, sock it away for them for when they eventually move out.
Transition from provider to coach. Guide them instead of just handing over cash.
Set a loose timeline. It's good for both you and them to have a plan in place for when they'll fly the coop.
Listen to their ideas. Encourage them to come up with a plan for their independence, and then work through it together.

Now, about those multigenerational households. They're becoming more common, and there's a lot to gain from having everyone under one roof. Grandparents get company, parents get extra hands with the kids, and the kids get to bond with their elders.

Bottom line? Living with family has its perks and pitfalls. If you're guiding your adult child, help them build their money skills, share the load at home, and be their coach, not just their piggy bank. And remember, it's all about finding that balance and listening to each other along the way.

Source: https://www.getsmarteraboutmoney.ca/learning-path/life-events/how-to-help-your-adult-children-build-financial-independence/

10 Simple Ways to Increase Your NEAT

Mon, 13 May 2024 18:51:42 GMT

With spring upon us, you may be feeling a touch healthier and more active. If so, you can likely attribute this to your NEAT naturally increasing with the nicer weather. What does NEAT actually mean?

NEAT stands for “Non-Exercise Activity Thermogenesis.” It’s your key to burning more calories without even thinking about them. NEAT represents the calories you burn by moving throughout the day, when you’re not at the gym. Activities that contribute to your NEAT are going to the office, shopping, cooking, walking the dog, housework, gardening and many other daily movements that you do without the goal of intentionally training.

The percentage of total calories burned through NEAT varies between about 15% and 30% depending on your lifestyle. Here is a rough idea of what portion of total calorie consumption NEAT represents.

Here is a breakdown of what each category really means:

Basal Metabolic Rate (BMR)

Your basal metabolic rate refers to the calories your body needs to maintain all its essential functions – without moving. Functions like breathing, maintaining your organs, and supplying your muscles with nutrients. That’s why your BMR usually goes up as your fitness improves.

Thermic Effect of Food (TEF)

This kind of thermogenesis includes all the calorie expenditure that comes from eating something. Sounds contradictory at first, but you have to process that food somehow, and that also requires some energy in itself.

Food needs to be broken down into its individual components, nutrients must be transported to their destinations, and anything unnecessary has to be eliminated. This process requires energy and therefore you burn calories alongside your energy intake.

Fun fact: Protein has a higher thermic effect than other macros. So if one of your goals is weight loss or fat loss, pay attention to your protein needs.

Thermic Effect of Activity (TEA)

Deliberate exercise has an obvious effect on your energy balance, so you burn more calories on workout days than on rest days. Intensive HIIT units, in particular, keep your metabolism boosted with the afterburn effect .

Non-Exercise Activity Thermogenesis (NEAT)

The calories you burn through NEAT are those your body needs for everyday activities like climbing stairs, walking from your desk to the kitchen, doing household chores, fixing your bike, and other similar movements.

Now for the good stuff...

10 Simple Ways to Burn More Calories in Your Daily Routine

Every movement counts with NEAT no matter how small. Fidgeting in your desk chair, parking further away for an extra walk, or those 10 minutes of standing in place instead of sitting. Alone, those movements may not seem like much, but they can really add up throughout the day!

1. Add Exercise to Your Breaks

How often do you catch yourself checking your social-media feeds or getting up to grab a snack while working at your desk? If you’re like most of us, the answer is probably “too often.” And that’s good! Because it’s also your chance to establish a new movement routine.

Always wanted to learn handstands, do more ab workouts, or just stretch more often? Every time you think about whipping out your smartphone or grabbing a snack, do a handstand, 5 crunches, or a little stretch instead.

You can even do your stretches while sitting on your office chair. But you’ll boost your NEAT levels more by standing up (or switching to a standing desk).

2. Go By Bike or Foot

The classic solution for anyone who wants to move more: Take your bike instead of driving a car public transportation.

Of course more movement is better, but baby steps add up too: Get off the bus one stop earlier, or walk up and down the street after parking. Whatever works for you!

3. Stand When You Can

Whether you’re on the phone, in a meeting, or in the office, simply stand up instead of sitting whenever possible! Standing burns more calories than sitting, increasing your NEAT. Plus, your cardiovascular health and your muscles will thank you for the change of pace.

4. Take the Stairs

Climbing stairs for 15 minutes burns an average of 120 calories. Think about how many show up in your daily routine. If you take every chance to take the stairs, you’re sure to get to at least 15 minutes.

Bonus: taking the stairs is a great lower-body workout. If you mostly use the ball of your foot, your calf muscles have to work. If you concentrate on evenly distributing your weight over the whole foot instead, you also train all your quads and gluteal muscles.

5. Walk Your Groceries Home

Carrying shopping bags is Functional Training par excellence, it’s completely free and doesn’t take up any extra time.

Pack your bags to distribute the weight of your groceries evenly between them, and carry them home from the grocery store instead of loading them into your bike basket or car. A fully loaded backpack also counts.

Pro tip: a bit of weight in your backpack (a liter of water for example) is also a great way to add an extra challenge to climbing a stair or two.

6. Get Cleaning!

Imagine your parents are coming to visit. You’d probably have to do at least a bit more cleaning than usual. And household chores, especially vacuuming, mopping, and ironing, increase your NEAT significantly. Not to mention, everyone loves the feeling of a clean space.

Cleaning not your thing? Gardening is also a fantastic way to get your body and heart moving.

7. Lose the Laundry Basket

This may sound silly, a very simply way to sneak in some extra steps is to take each pile of clean laundry individually to its place, rather than loading your basket to deliver. Remember, all these small things add up. Laundry isn’t going anywhere anytime soon, so this tiny habit can keep you consistently moving more.

While you're at it, try switching sitting for standing while you’re folding!

8. Intentionally Park Far Away

Ok, I know this is a tricky one when you’re in a hurry. If you run 4 errands and your walk to and from your car is an extra 2 minutes each way, you’ve just added 16 minutes of NEAT into your day.

For a little extra motivation, it’s also a great way to protect your vehicle from door dings!

9. While You’re Waiting… Walk!

Whether it’s passing time at the bus stop when your date is running late, or if you’ve just arrived somewhere too early, talk another walk around the block instead of sitting down right away.

In addition to the effect on your NEAT level, your spine will thank you if you walk a bit between longer periods of sitting.

10. While You’re Doing Everything Else… Walk!

Phone calls, podcasts, chats over coffee. Almost everything can be enjoyed on a walk instead of sitting. Exercise in the fresh air also strengthens your immune system and gives your eyes and mind a welcome break from screens.

Sources: https://www.foodspring.co.uk/magazine/how-to-increase-neat

https://www.nifs.org/blog/keep-up-with-neat-less-sitting-and-more-little-things-that-burn-calories

May Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Mon, 13 May 2024 18:48:40 GMT

Equities Tumble, Higher Mortgage Rates, and Long-Term Treasury Yield Increases

It's been a rough month for stocks following three straight months of gains. The S&P 500 fell 4.1% in its first monthly decline of 2024, the NASDAQ sank 4.4%, and the Dow Jones Industrial Average tumbled 4.9%. Emerging Markets was the only index on our chart (below) to post a positive gain in April. The Russell 2000 was the worst performer in April, plummeting 7%.

Only the Utilities sector was positive in April. Of the remaining ten sectors , Real Estate was the worst-performing sector, sinking 8.5%, followed by Technology and Health Care which fell 5.8% and 5.0%, respectively.

The 30-year mortgage rate surpassed 7% for the first time in 2024. Housing demand was mixed ; new single-family home sales rose month over month but existing home sales fell. Bitcoin took its first breather of 2024, while the price of physical gold surged to a new al l-time high.

Economic Data Overview:

Employment

March’s unemployment rate fell to 3.8% as the labor force participation rate increased to 62.7%. According to nonfarm payroll data, 303,000 new jobs were added in March, marking the first month of U.S. job gains since May 2023 and surpassing estimates that ranged from 150,000 to 250,000.

Consumers and Inflation

US inflation has now hovered in the 3-4 percent range for the last nine months, with March’s figure coming in at 3.48%. This was also the second consecutive monthly increase for YoY inflation. The Core Inflation rate for March was 3.80%, which continues to sit just below 4%. The monthly US Consumer Price Index rose 0.38% in March, and US Personal Spending’s MoM increase of 0.84% was the highest in 14 months. The Federal Reserve held its key Fed Funds Rate at 5.50% at its May 1st, 2024 meeting, marking the sixth consecutive meeting in which the Fed left rates unchanged.

Production and Sales

After posting an expansion reading for the first time since October 2022, the US ISM Manufacturing PMI fell 1.1 points to 49.20, putting it back into contraction territory. The Year over Year US Producer Price Index came in at 2.09%, the first time above 2% since April 2023, while February US Retail and Food Services Sales increased by 0.7% Month over Month.

Housing

US New Single-Family Home Sales surged 8.8% MoM in March, but US Existing Home Sales sank 4.3% Month over Month. Despite the slip in demand for existing homes during March, a strong month in February pushed the Median Sales Price of Existing Homes up 2.5% in March to $393,500. Mortgage rates increased slightly in April; the 15-year Mortgage Rate rose to 6.44% as of April 25th, and the 30-year pushed above 7% for the first time since December 2023, to 7.17%.

Commodities

The price of Gold advanced another 5.8% in April, to $2,343.10 per ounce as of April 26th amid geopolitical tensions, persistent inflation, a weakening dollar, and increased purchasing of the precious metal by central banks. Gold briefly topped $2,400 per ounce on April 12th. Crude oil prices increased slightly in April; the price of WTI ended April at $84.26 per barrel while Brent inched up to $88.44. Despite the muted activity in crude oil, the average price of gas increased 14 cents to $3.78 per gallon.

Cryptocurrencies

Cryptocurrency prices regressed in April. The price of Bitcoin dove 8.5% to $63,798 in April. Ethereum posted a similar decline, tumbling 8.4% to $3,214 in the month. Despite the breather Bitcoin and Ethereum took in April, the two have had a solid 2024 so far; Bitcoin is 51.1% higher, and Ethereum is up 40.1%.

As for Fixed Income, Yields on long-term Treasury bonds rose significantly in April. Th e 5-year Treasury note increased 51 basis points, the most of any duration on the curve. The 2-year , 3-year , 10-year , 20-year , and 30-year all increased by at least 45 basis points, while there was little activity on the shorter end of the curve.

Bond fund performance slumped as a result of the higher yields. The iShares 20+ Year Treasury Bond ETF ( TLT ) slipped 6.5%, the sharpest decline of any bond fund tracked on our chart (below).

Source: https://get.ycharts.com/resources/blog/economic-update-reviewing-q1-2024/

A Guide to Managing Money as a Couple

Mon, 13 May 2024 18:47:11 GMT

So, you’re in a relationship, and that means you're sharing more than just your time and space—you're sharing your money too. Handling finances together can be a bit of a maze, but there are some good ways to navigate it as a team. Keep in mind, though, every relationship has its own quirks, so it’s important to figure out what works best for both of you. Whether you’re just starting to dive into money talks or looking to spruce up your financial game plan, here are some practical tips you might find helpful.

Why Talk About Money in a Relationship?

Money talk isn’t exactly pillow talk for everyone, but it’s pretty crucial when you’re in a partnership. How you and your partner view money can have a big impact on your relationship. Your money mindsets influence everything from daily spending decisions to bigger financial goals. Plus, if you two see money differently, it can stir up some tension or even full-blown arguments.

Chatting about money means being upfront and honest with each other. You’ll want to share your spending habits, values, and attitudes toward money. Understanding each other's financial quirks lays down a solid foundation for your relationship. It helps you set joint financial goals and avoid any uncomfortable surprises, like finding out your partner’s drowning in debt.

Starting the Money Conversation

Okay, but how do you actually kick off the money talk? Sometimes it’s easier to slip money into the convo when it comes up naturally. Here are a few low-key conversation starters you could try:

Did you get an allowance when you were a kid?
What was your first part-time job, and how old were you?
Any money-saving tips you learned from your parents?
Who taught you about budgeting?

And hey, money chats don’t always have to be scheduled events. You could bring it up when you’re divvying up the restaurant bill, picking out a gift for a friend, or even just strolling through the grocery store.

Need some help to start talking about money as a couple? Try this Love and Money Quiz!

Setting Financial Goals Together

Once you’ve dipped your toes into the money talk pool, it’s time to think about your financial future as a duo. Setting joint financial goals can set you up for success down the road. There are short-term goals, like saving up for a vacation, and long-term ones, like planning for retirement or buying a home.

How to Manage Money as a Couple

Alright, let’s get down to the nitty-gritty. When it comes to managing your moolah together, there are a few ways to go about it:

Joint Accounts: Pool your funds into shared accounts for household expenses. It's straightforward, but disagreements over spending can crop up.

Separate Accounts: Keep your money separate but divvy up the bills. This keeps things fair but may require more communication.

Hybrid Approach: Combine joint and separate accounts to maintain some independence while sharing financial responsibilities.

Each approach has its perks and pitfalls, so it’s about finding what clicks for you both.

Regular Money Check-Ins

Keep your financial boat afloat by scheduling regular money dates. Crack open a bottle of wine, whip up a nice dinner, and dive into your finances together. Review expenses, tweak your budget, and track progress toward your goals. And remember, it's a team effort, so both of you should be involved.

Legal Matters

Lastly, when you merge your financial lives, there are some legal bits to sort out too. Have a will, update it as needed, and make sure your life insurance and financial accounts have the right beneficiaries listed.

In a nutshell, managing money together isn’t always smooth sailing but with some open communication and teamwork, you can navigate it together. Start those money chats early, set joint goals, figure out your money management style, and keep the conversation flowing. As long as you’re both honest and upfront about money matters, you’ll be on the right track.

Learn about your own behavioral biases and how they may impact your investment decisions.

Source: https://www.getsmarteraboutmoney.ca/learning-path/life-events/how-to-help-your-adult-children-build-financial-independence/

April Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 11 Apr 2024 21:12:46 GMT

This commentary is compliments of Manulife Investments -

2024 starts with a bang!

Global markets stormed out of the gate in the first three months of 2024. The combination of a resilient consumer base and lower inflation levels created a positive backdrop for investors. The S&P 500 Index, the S&P/TSX Composite Index, and the MSCI World Index were up 10.2%, 5.8% and 8.4%, respectively, in Q1. The euphoria, however, didn't extend to the fixed-income space—Canadian and U.S. bonds (measured by the FTSE Canada Universe Bond Index and Bloomberg U.S. Aggregate Bond Index) were down 1.2% and 0.8%.

In our view, equities are priced for the best case scenario, with markets expecting to avoid a recession, on the belief that we’ll see a gradual decline in inflation, and that central banks will soon start cutting interest rates. In such an environment, any headline surprises that state otherwise may create potentially choppy markets in the near term.

How do stocks and bonds perform when the government begins to cut rates?

Investors have been waiting in anticipation for the U.S. Federal Reserve (Fed) to start cutting interest rates. They believe that lower interest rates will help drive the markets even higher. That said, history suggests things may not be quite as simple.

We looked at the previous nine easing cycles, dating back to 1970. In the first chart, we’ve indicated (in red) periods that we believe to mark the beginning of an easing cycle. These are easily identifiable in recent easing cycles; however, those in the early 1980s aren’t and require subjective interpretation.

The second chart shows the one- and two-year forward returns for various asset classes from the first rate cut of each cycle. Generally speaking, investors were rewarded in both timeframes. Certain assets, however, including those represented by the Russell 2000 Index, U.S. High Yield Index, and the Russell Midcap Index, posted strong gains in the second year while experiencing choppiness in the first year.

But wait, not all rate-cutting cycles are identical: If you were to look at the third chart closely, you should be able to see two distinct return profiles. Generally speaking, returns were favorable once the Fed began cutting rates with 2001 and 2007 being exceptions.

Overall, it’s fair to say that the Fed’s rate-easing cycles were in sync with the flow of the natural economic cycle. However, the circumstances in 2007 and 2001 were unique: In 2001, the context around the Fed’s rate cuts included a stock market bubble, a recession, and 9/11; in 2007, the backdrop was framed by the global financial crisis.

Today, our base case is that the Fed will likely cut rates later in the year amid what we believe to be a traditional economic cycle. Against that backdrop, investor returns will likely be positive moving forward. However, if something unexpected emerges, investors would be better served by proceeding with care.

Source: Manulife Investments Management, 2024 Q2 Macro & Markets Outlook

Work Hard, Play Hard: The Science Behind It

Thu, 11 Apr 2024 19:52:50 GMT

Calling all high achievers! Maybe fun isn’t the first place your head goes to when thinking of high performance. We’re talking to you- the hard worker, the busy parent, the dedicated athlete, the responsible sibling. We’ve got compelling, scientific evidence proving how important it is for you to incorporate fun and play into your life! You’ll also find some practical suggestions for incorporating more fun into your daily routine.

Research indicates that happy individuals tend to be healthier physically, have lower inflammatory markers, and may even have improved productivity at work. Happiness has also been linked to better mitochondrial health and is a key factor in sustainable high performance. A recent study on twins suggests that 35% to 50% of your happiness is genetically predetermined. That means there's still a significant portion of happiness that's within our control. Interestingly, humans typically aren’t the best at knowing exactly what makes them happy. Dr. Gillian Mandich, who studies the science of happiness, says that it’s not the big shiny moments that matter, but rather the small moments over time that determine how happy we are.

It is recommended to dedicate at least two hours per day to fun. Engaging in playful activities, such as games or sports not only increases happiness, but it’s also important for your brain. A study found that juvenile rats that engaged in “rough and tumble” play had higher activation in certain areas of the brain compared with control rats. They also had greater brain-derived neurotrophic factor (BDNF) gene expression, suggesting that play is important for neurodevelopment.

Humor is another way to sprinkle small bursts of joy throughout the day. Laugh therapy is currently being used to treat depression and anxiety, as well as stress-related disease. Research shows that laughter actually supresses cortisol, and boosts dopamine and serotonin hormone levels.

Playfulness isn't just beneficial for personal wellbeing; it can also have positive effects in professional and practical settings. Play has been shown to reduce stress, increase productivity and job satisfaction, and improve overall work quality and team cohesion.

Play can also serve as an effective coping mechanism for stress, allowing you to mobilize cognitive resources and build resilience in the face of challenges.

Contrary to the belief that play is only for children, research demonstrates its importance for health and wellbeing across all age groups, adults being the most prone to high stress levels. Remember that striving for constant happiness can be counterproductive. Happiness is a result, not a pursuit. Accepting the ups and downs of life and focusing on creating joyful moments, when possible, can lead to a more sustainable sense of wellbeing.

In summary, incorporating more fun, play, and happiness into our lives can lead to numerous benefits, including improved physical health, enhanced productivity, and greater overall wellbeing. It's essential to prioritize these elements and recognize their significance for both personal and professional fulfillment. If you’ve been all work, no play lately- this is your sign to get out there and have some FUN!

Source: https://drgregwells.com/blog/your-brain-on-play-the-science-of-how-fun-can-fuel-wellbeing

References:

Dfarhud, D., M. Malmir, and M. Khanahmadi. “Happiness & health: The biological factors—systematic review article.” Iranian Journal of Public Health 43, no. 11 (November 2014): 1468–1477.

Panagi, L., L. Poole, R.A. Hackett, and A. Steptoe. “Happiness and inflammatory responses to acute stress in people with type 2 diabetes.” Annals of Behavioral Medicine 53, no. 4 (March 20, 2019): 309–320.

Salas-Vallina, A., M. Pozo-Hidalgo, and P.R. Gil-Monte. “Are happy workers more productive? The mediating role of service-skill use.” Frontiers in Psychology 11 (March 27, 2020): 456.

Picard, M., A.A. Prather, E. Puterman, A. Cuillerier, M. Coccia, K. Aschbacher, Y. Burelle, and E.S. Epel. “A mitochondrial health index sensitive to mood and caregiving stress.” Biological Psychiatry 84, no. 1 (July 1, 2018): 9–17.

Chick, G., C. Yarnal, and A. Purrington. “Play and mate preference: Testing the signal theory of adult playfulness.” American Journal of Play 4, no. 4 (2012): 407–440.

Wallace, J. “Why it’s good for grown-ups to go play.” Health and Sci- ence. Washington Post (May 20, 2017). https://www.washingtonpost . com/national/health-science/why-its-good-for-grown-ups-to-go- play/2017/05/19/99810292-fd1f-11e6-8ebe-6e0dbe4f2bca_story.html.

Magnuson, C.D., and L.A. Barnett. “The playful advantage: How playfulness enhances coping with stress.” Leisure Sciences 35, no. 2 (2013): 129–144.

Neale, D. “A golden age of play for adults.” British Psychological Society (March 25, 2020). https://www.bps.org.uk/psychologist/gold- en-age-play-adults.

Edwards, D. “Play and the feel good hormones.” Primal Play (June 23, 2022 ). https://www.primalplay.com/blog/play-and-the-feel-good- hormones.

Guitard, P., F. Ferland, and É. Dutil. “Toward a better understand- ing of playfulness in adults.” OTJR: Occupation, Participation and Health 25, no. 1 (January 1, 2005): 9–22.

Canadian Currency Update

Thu, 11 Apr 2024 19:52:48 GMT

The Canadian dollar's recent decline to its lowest level in almost two years against the US dollar is primarily attributed to several factors, including worsening economic outlook, rising inflation concerns, and diverging monetary policies between the US Federal Reserve and the Bank of Canada.

Inflation Concerns: The persistently high inflation in the United States has raised expectations of aggressive interest rate hikes by the Federal Reserve. This anticipation of higher interest rates in the US has led to a flight to safety, with investors favoring the US dollar over other currencies, including the Canadian dollar.
Diverging Monetary Policies: The Federal Reserve is expected to raise its benchmark interest rate significantly, possibly reaching as high as 4 or 5 percent, whereas the Bank of Canada may not be able to match such aggressive rate hikes due to concerns about the impact on the housing market and consumer spending. This disparity in monetary policy paths between the two central banks is widening the gap between the US dollar and the Canadian dollar.
Commodity Prices: The Canadian dollar is also influenced by commodity prices, particularly oil, as Canada is a major oil exporter. The recent decline in oil prices, coupled with softness in other commodity prices, has further weighed on the Canadian dollar's performance.
Market Sentiment: Market sentiment plays a crucial role in currency movements. The prevailing perception among investors is that the US dollar is a safer haven during times of uncertainty, leading to increased demand for the US dollar and consequent weakness in the Canadian dollar.
Expectations for Future Performance: Some analysts predict further depreciation of the Canadian dollar against the US dollar in the near term, with projections of the loonie falling below 73 cents by the end of the year. This outlook reflects concerns about the Canadian economy's relative weakness compared to the US economy.

Overall, the combination of inflation worries, diverging monetary policies, commodity price movements, and market sentiment has contributed to the recent depreciation of the Canadian dollar against the US dollar, with implications for Canada's economic outlook and trade competitiveness.

Source: https://www.cbc.ca/news/business/canadian-dollar-1.6585291

Preparing for the RRSP to RRIF Deadline in your Early 70's

Thu, 11 Apr 2024 19:52:35 GMT

If you’re delving into the intricacies of managing retirement savings, particularly the transition from RRSPs to RRIFs, read on. This transition is crucial to understand, especially considering the tax implications and mandatory withdrawal requirements associated with RRIFs.

Missing the deadline to convert your RRSP to a RRIF can have significant tax consequences, as the entire value of your RRSP becomes taxable income, potentially pushing you into a higher tax bracket. This underscores the importance of staying vigilant about conversion deadlines. You can convert anytime but the last year to convert is the year you turn 71.

While RRSPs and RRIFs share similarities, such as holding the same investments and being fully taxable upon withdrawal, there are key differences to note, such as the lack of contribution capability in RRIFs and the mandated minimum withdrawals.

Managing RRIF withdrawals is a strategic endeavor, involving considerations like tax implications, OAS claw backs, and income splitting with a spouse. Additionally, converting a RRIF back to an RRSP is possible under certain circumstances, offering flexibility in retirement planning.

Understanding the mechanics of RRIF conversion, the timing of withdrawals, and the options for structuring payments is essential for optimizing retirement income and minimizing tax liabilities. Navigating the transition from RRSPs to RRIFs requires careful planning and consideration of various factors to ensure financial stability and tax efficiency in retirement. Reach out to us anytime for more information or clarity!

Source: How to cope with the RRSP-to-RRIF deadline in your early 70s - MoneySense How to cope with the RRSP-to-RRIF deadline in your early 70s - MoneySense

Fraud Awareness Month

Wed, 20 Mar 2024 19:02:27 GMT

March Fraud Awareness Month

Did you know that March is Fraud Awareness Month?

We’re here to shed some light on the importance of protecting yourself and your finances from potential scams to secure your financial stability. Recognizing common mortgage fraud schemes and employing protective measures can significantly mitigate risks.

The most common mortgage fraud often involves inflating a property's value through a series of transactions orchestrated by criminals in collaboration with accomplices. Subsequently, a mortgage is secured based on the artificially inflated price. Here are some red flags to watch out for:

Offers of money in exchange for using your name and credit details to secure a mortgage.
Encouragement to provide false information on a mortgage application.
Requests to leave crucial sections of the mortgage application blank.
Discouragement from inspecting the property before purchase.
Undisclosed rebates from sellers or developers during the closing process.

Another fraud to be wary of is title fraud, akin to identity theft, often detected when mortgages unexpectedly default. Fraudsters assume your identity, transferring property ownership to themselves, securing new mortgages, and absconding with the funds. However, several precautions can safeguard against such fraudulent activities:

Personally inspect the property before purchase.
Compare property listings in the vicinity to gauge the reasonableness of the asking price.
Ensure your representative is a licensed real estate agent.
Exercise caution with realtors or mortgage professionals who may have vested interests.
Request a copy of the land title or conduct a historical title search.
Incorporate provisions for property appraisal and home inspection in the purchase agreement.
Demand documentation for recent renovations.
Ensure your deposits are held securely in trust.
Consider purchasing title insurance for added protection.

Remember, proactive vigilance is paramount in safeguarding yourself and your mortgage from potential fraud. Prompt action and reporting suspicious activities to relevant authorities can mitigate risks effectively.

Additionally, understanding your credit score is vital for homeownership. Your credit score significantly influences mortgage qualification and terms. Aim for a score of at least 680, reflecting responsible financial habits such as timely bill payments, managing debt levels, maintaining a healthy credit mix, and limiting credit applications.

To improve your credit score:

Pay bills in full and on time.
Prioritize debt repayment, starting with smaller balances.
Maintain credit utilization below 70% of available credit.
Limit credit and loan applications to avoid negative impacts on your score.

For assistance regarding your credit score, feel free to reach out for guidance.

The economic landscape, as noted by the Bank of Canada, is focused on curbing inflation. Despite recent declines in inflation due to various factors like energy prices and consumer goods, shelter costs remain a significant contributor to inflationary pressures.

Housing starts in Canada are insufficient to meet growing demand, exacerbated by zoning restrictions, rising construction costs, and labor shortages. Despite government efforts, the pace of immigration continues to strain housing supply, leading to upward pressure on rents.

The Bank of Canada acknowledges these challenges and anticipates cutting interest rates to stimulate economic activity. As such, homeowners should anticipate higher mortgage payments upon renewal, prompting potential rate cuts starting mid-year to alleviate financial burdens.

With housing activity bottoming out, home prices are anticipated to rise, especially in major metropolitan areas like the GVA and GTA. The central bank's anticipated rate cuts aim to mitigate economic slowdowns and support housing market stability.

Source: https://ised-isde.canada.ca/site/competition-bureau-canada/en/fraud-and-scams/fraud-prevention-month

Protecting Your Gifted Down Payment

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 20 Mar 2024 19:02:26 GMT

Protecting your gifted down payment for your kids

We’ve had the joy of watching many of our clients raise their children and like our girls, they are getting ready to leave the nest! Soon many of them may be purchasing their first homes.

With today’s housing costs, it’s becoming increasingly common for parents to gift a down payment to their adult children. While this is very exciting, it is shedding light on the issue of protecting your gift should there be a relationship breakdown in the future. Here is a story of one of our wonderful clients as an example, although we’ve changed their names and the amount for autonomy.

One of our client’s, Kim and Kelvin, are giving their daughter Jen a large ‘gift’ of $300K to help her purchase her first home. Thanks to her parents, Jen is contributing significantly more to the purchase than her boyfriend, John.

How can Kim and Kelvin protect their money if Jen and John’s relationship breaks down? They wouldn’t be happy if Jen had to split the down payment 50/50 with John if they broke up.

There are a few ways to protect the gift:

1. Kim and Kelvin could give Jen and John a promissory note that they owe the parents the $500K at 0% interest but no payments are required, and the parents can put in their will that it will be forgiven upon their death. Then the parents can ‘demand’ the money back if something happened to their child’s relationship.

2. The parents could register a lien as a 2 ^nd mortgage after Jen and John get the first mortgage so that again the money is secured. This needs to be done by a different lawyer than who did the first mortgage, or the bank will need to give permission for it to be registered.

3. Jen and John could do a cohabitation agreement to discuss what they would expect and what would happen to the gift if their relationship broke down. No one likes to do this, but it does protect the gift.

If Kim and Kelvin were worried about the gift if Jen died, then then Jen and John could register the property title as Tenants in Common rather than Join Owner With Right of Survivorship, so they could guarantee their child’s portion (in this case percentage) was always hers if she passed away.

A lawyer will explain best and has the paperwork to set these documents up.

Source: https://ised-isde.canada.ca/site/competition-bureau-canada/en/fraud-and-scams/fraud-prevention-month

Estate Planning

Wed, 20 Mar 2024 19:02:25 GMT

Did you know that 1.7 million Canadians are expected to be living with dementia by 2050?

If you or someone you love has been effected by the rising cases of Dementia, you know all too well how quickly having these uncomfortable conversations becomes a challenge.

While designing an estate plan might feel overwhelming, it’s critical to work through as soon as possible to ensure you aren’t left without a plan in place.

Your Comprehensive Checklist for Estate Planning:

In our experience, breaking estate planning down into manageable steps can streamline the process and save both time and money.

Here's a checklist to guide you through the crucial decisions:

Defining Your Goals and Wishes: Before diving into the process, take time to clarify your objectives. Ask yourself:

Who are the beneficiaries you wish to provide for after your passing?
What are your assets, and how do you want them distributed?
Have you selected a primary beneficiary, and who would be the alternate if needed?
In the event of your incapacity, who would make decisions on your behalf?
Who would you appoint as a guardian for your minor children, and have they consented to the role?

Preparing Your Will and Power of Attorney Documents: Contrary to common belief, creating a will is a straightforward process. Here's how to get started:

Make a list of your key assets without the need for exhaustive detail.
Document your liabilities to ensure debts are settled from your estate.
Update beneficiary designations for investments like RRSPs and LIFs.
Record essential information about life insurance policies, including policy numbers and beneficiaries.
Consider any available disability income insurance for future care needs.

Selecting Key Individuals: Carefully choose the individuals who will play critical roles in your estate plan:

Appoint a Power of Attorney for healthcare, ensuring they understand their responsibilities.
Nominate an executor for your will, discussing the role's requirements beforehand.
Decide on beneficiaries for your residual estate, considering their needs and circumstances.
If you have dependent children, designate a guardian for their care and inheritance management.
Ensure provisions are made for family members with special needs to maintain government benefits.

Special Considerations: Address any unique circumstances or preferences in your estate plan:

Determine arrangements for the care of pets after your passing.
Create a list of specific items you wish to allocate to particular recipients.
Review assets with joint ownership to understand their disposition.
If you're a business owner, plan for the transfer of your business in case of disability or death.

Four Essential Factors in Estate Planning: Consider these crucial aspects when crafting your estate plan:

The complexity of your estate, influenced by factors such as multiple marriages, foreign assets, or business ownership.
Your life stage, including dependents relying on your support or charitable legacy considerations.
Personal goals, such as providing for loved ones or sustaining a partner's standard of living.
Trusted individuals to act on your behalf, whether in incapacity or after your passing.

Understanding the Role of a Will: Your will serves as the cornerstone of your estate plan, outlining key instructions for asset distribution and dependent care. Key components include:

Appointment of an executor and beneficiaries.
Specific bequests and funeral wishes.
Importance of testamentary trusts for minor children or disabled individuals.

Choosing Between a Will and a Trust:

Wills and trusts complement each other and serve different purposes. While wills dictate asset distribution, trusts offer additional benefits such as tax management and asset protection. Consider seeking legal advice for complex estate plans.

Life Insurance in Estate Planning:

Life insurance can play a vital role in equalizing payouts to beneficiaries and ensuring fair asset distribution. It's essential to integrate life insurance into your estate plan effectively.

Maintaining an Updated Estate Plan:

Regularly review your estate plan, especially during significant life events like marriage, divorce, or the birth of a child. Keeping your plan current ensures it aligns with your evolving circumstances.

Pre-planning for End of Life:

Consider pre-arranging burial or cremation services to alleviate stress on your family. Pre-planning can also lead to cost savings amid rising service expenses.

Whether you choose an online will service or consult a lawyer, prioritizing estate planning now can provide peace of mind and clarity for your loved ones in the future.

We are happy to shed light and share resources, but as always we are here should you have any specific questions or would like more guidance. An estate plan is a fundamental piece of your Financial Plan, and at Right Direction Financial we are passionate about ensuring you have peace of mind and a strong plan in place.

Reach out anytime to discuss your plan in greater detail!

Source: https://advisorsavvy.com/estate-planning-checklist/

Aging Actively with Yoga

Wed, 20 Mar 2024 19:02:24 GMT

The Benefits of Yoga as We Age

Aging is often described as a privilege denied to many. However, it can be challenging to gracefully acknowledge the changes that come with age, especially the ones that are felt more than they are seen, like stiffness, aches, and a lack of stability. As you grow older, you may notice your body becoming less flexible, less stable, and slower. It's natural for muscles, fascia, and skin to lose elasticity over time. Despite these changes, regular movement, including practicing yoga, can help slow down the effects of aging.

With age, you can expect changes in your body. You may experience decreased bone density, muscle loss, or back pain. However, you've likely found that yoga can often alleviate or relieve these symptoms. Regardless of whether you're dealing with heart issues, diminished lung capacity, or arthritis, yoga helps you feel better.

While we often hear about the negative changes that come with aging, we hear less about the wisdom, confidence, and life experience that accompany spending decades on Earth. You've likely come to appreciate the enhanced self-confidence, body image, empathy, and decision-making skills that come with age. While focusing on these positives, it’s also entirely possible to enjoy the benefits of your body aging gracefully with the help of a regular yoga practice.

Here are 15 ways yoga can benefit you as you age:

Osteoporosis and Osteopenia : Weight-bearing yoga poses help keep your bones healthier for longer.
Arthritis: Regular yoga practice has been shown to reduce joint pain and improve flexibility.
Spinal stenosis: Cautious yoga practice can significantly reduce pain caused by spinal stenosis.
Disc issues: Yoga helps you build core strength and flexibility in your spine, alleviating back pain.
Core strength and back pain: Yoga strengthens your core muscles, supporting your spine and reducing back pain.
Nerve pain and neuropathy: Gentle yoga movements improve circulation and body awareness, helping manage nerve pain.
Ligament tears: Yoga strengthens muscles around your joints, offering protection against ligament injuries.
Tendonitis and tendinopathy: Yoga helps establish new movement patterns, aiding in tendon healing.
Myofascial tightening and stiffness: Regular yoga practice reverses stiffness and improves flexibility.
Hormonal changes: Restorative yoga helps decrease hot flashes associated with menopause.
Blood pressure: Yoga can lower blood pressure, promoting cardiovascular health.
Asthma: Yoga's low-impact nature makes it suitable for people with respiratory issues like asthma.
Breathing issues: Yoga's focus on breath practices strengthens respiratory muscles and enhances breath awareness.
Sleep issues: A gentle yoga routine before bed promotes relaxation and better sleep quality.
Chronic illness: Yoga can be an effective tool for managing chronic pain and promoting overall well-being.

Bonus! In addition to physical benefits, yoga also helps combat boredom and loneliness as you try new experiences and connect with others in the yoga community.

Source: https://www.yogajournal.com/yoga-101/15-anti-aging-health-benefits-of-yoga/

March Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 20 Mar 2024 19:02:09 GMT

What are the 5 big banks predicting for interest rate cuts for 2024?

Canada Interest Rate Outlook- March 2024:

Here are the latest interest rate cut predictions from the big 5 Canadian banks. I think it’s interesting to see. If you have a mortgage, you’ll be hoping these interest rate cuts happen sooner than later. If you have money in savings, you’d prefer rates stay high!

*Lower Bound of the US Federal Reserve Target Rate, Upper Bound +25bps

Sources: most recent update: TD Economics (January 22, 2024), RBC Economics (Febraury, 2024), BMO Economics (March 1, 2024), CIBC Economics (Febraury 15, 2024), Scotiabank (Febraury 6, 2024)

Stock Market Highlights:

· Despite a mid-month dip sparked by higher-than-anticipated U.S. Inflation figures for January, which tempered expectations for rate cuts, U.S., Canadian, and global equities rallied to mark their fourth consecutive month of gains.

· Nvidia, a leading AI chipmaker and a significant player in the tech sector, announced stellar results for Q4 2023, igniting a global equity rally.

· The U.S. economy added a remarkable 353,000 new jobs in January, with the unemployment rate dropping to 3.7%. However, the uptick in average hourly earnings raised concerns about inflationary pressures, potentially delaying anticipated rate cuts.

· China's central bank implemented an unprecedented cut in its five-year loan prime rate, from 4.2% to 3.95%, aimed at revitalizing the real estate market and reducing mortgage costs to stimulate demand.

· The International Monetary Fund (IMF) released optimistic growth forecasts for 2024 and 2025, projecting a global output increase of 3.2%. Notably, Canada's GDP is expected to grow rapidly, ranking third among advanced economies.

· U.S. CPI for January moderated from 3.4% to 3.1%, though still above the Fed’s 2% target, prompting a brief market pullback as rate cut expectations adjusted. However, the Fed's focus on the PCE Index suggests the reaction may have been exaggerated, leading to a swift market recovery.

· Canadian Inflation for January decreased from 3.4% to 2.9%, mainly due to falling gasoline prices. Excluding problematic mortgage interest costs, inflation would stand at 2%, bringing the Bank of Canada closer to considering rate reductions.

Implications for Investments:

· Global equity markets continue to soar to new highs, led by U.S. and Japanese stocks, reflecting strong earnings and economic resilience. However, the rapid pace of these rallies and increasing valuations may introduce near-term volatility.

· Chinese equities have rebounded, driven by regulatory changes and oversight adjustments.

· Regardless of market cycles, maintaining a disciplined investment approach and focusing on long-term goals is key. This approach helps reduce emotional reactions that often lead to detrimental investment decisions.

· Regular monitoring and review of your portfolio ensure alignment with your objectives. Diversifying investments further mitigates risk exposure.

· We're committed to supporting you in achieving your financial goals. Feel free to reach out for personalized guidance and assistance.

Remember, staying disciplined and informed is key to navigating market fluctuations and achieving long-term success in your investment journey.

Sources: most recent update: TD Economics (January 22, 2024), RBC Economics (Febraury, 2024), BMO Economics (March 1, 2024), CIBC Economics (Febraury 15, 2024), Scotiabank (Febraury 6, 2024)

February Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Tue, 20 Feb 2024 18:26:13 GMT

The S&P 500 Just Crossed 5,000. What’s Next?

The S&P 500 took over headlines on a Friday in early February when it closed above 5,000 points for the first time.

From humble beginnings at just 16.66 points in January 1950, the widely-followed benchmark index has traveled far in the almost 75 years since, generating incredible wealth along the way.

Where Is the Market Right Now?

The S&P 500 closed above 5,000 for the first time on February 9th, 2024, at 5,026.61. The index’s journey from 16.66 to 5,000 elapsed 74 years, 1 month, and 7 calendar days.

Each horizontal red line marks a 1,000-point increment, while vertical gray bars indicate a recession period.

Source: www.ycharts.com

Early Innings: The S&P 500’s Rise to 1,000

It took the S&P 500 index nearly half a century to reach 1,000 points. Starting at 16.66 on the first trading day of 1950, the S&P 500 closed above the 1,000-point milestone for the first time 48 years and 1 month later.

hough the chart above might show a fairly smooth rise to 1,000, including accelerated growth starting in the 1980s, there were several major bumps along the way. In that 48-year journey, there were seven drawdowns of 20% or more, with the largest being 48.2% in October 1974.

Eight recessions also took place.

What Happened After the S&P 500 Reached 1,000?

The S&P 500 endured two of the largest recessions in history: the Dot-Com Bubble and the Great Financial Crisis. Both events also produced two of the largest drawdowns in history.

On the journey to 2,000, it took the index two years to get halfway…but the rally stalled out, and the index bumped against 1,500 again in 2007.

What Happened After the S&P 500 Reached 2,000?

After closing above 2,000 for the first time, the S&P 500 advanced to 3,000 in 4 years, 10 months, and 17 days. It closed above 3,000 on July 12th, 2019. Similar to its journey from 1,000 to 2,000, the index rose from 2,000 to 3,000 in exponentially less time.

What Happened After the S&P 500 Reached 3,000?

The S&P 500’s run from 3,000 to 4,000 took the shortest amount of time. The index climbed another 1,000 points in just 1 year, 8 months, and 21 days, reaching 4,000 on April 1st, 2021. Despite the event occurring on April Fools Day, such a rapid 1,000-point advance was no joke.

However, even 1,000-point jumps as fast as this one aren’t immune from major drawdowns. The Covid-19 pandemic in early 2020 sent the S&P 500 down almost 34% in a matter of weeks.

Fortunately for long term investors, the index roared all the way back, setting a new all-time high five months later on August 18th, 2020.

What Happened After the S&P 500 Reached 4,000?

That brings us to today. The S&P 500 traveled from 4,000 to 5,000 in 2 years, 10 months, 9 days. Though it took about twice as long as the journey from 3,000 to 4,000, this fifth 1,000-point advance was the index’s second-fastest.

On the road to 5,000, market participants endured a prolonged drawdown first. The S&P 500 entered this decline after January 3rd, 2022, sank to a max drawdown of 25.4% on October 12th, 2022, and didn’t set a new all-time high for a little over two years until January 19th, 2024.

Three weeks later, the index crossed the 5,000 mark.

What Could Happen Next for the S&P 500?

As the S&P 500 progresses to the next level of 6,000, it’s important to note that the journey to each milestone was marked by periods of volatility. Most 1,000-point marks included drawdowns of over 20%.

At the same time, the amount of time it has taken to achieve new 1,000-point thresholds has gotten shorter in duration. Though there are no guarantees on whether it will take the S&P 500 1 year, 10 years, or 100 years to reach 6,000, the best way to ensure you are part of the next milestone celebration is time in the market rather than timing the market.

Source: www.ycharts.com

All signed up for our Client Portal?

Thu, 15 Feb 2024 21:32:09 GMT

Did you know all of your Client Documents are available for you in real time through our secure Client Portal? Our clients privacy and security is of utmost importance to us at Right Direction Financial. Our Client Portal is the most secure way to access everything you need, from tax forms, to your latest Retirement Projections.

To assist in the set up and ease of use, we are now offering a Complimentary 15 minute Tutorial for our clients! If you're not set up, we encourage you to reach out for more information, or better yet, book an appointment with us directly!

Click here to book a Tutorial.

Balancing Your Cortisol Levels

Thu, 15 Feb 2024 21:32:07 GMT

Naturally, when we encounter delays or frustrations in your daily life, whether it's being stuck in traffic, waiting in line, or facing unexpected interruptions, it triggers a stress response. Missing a meeting due to circumstances beyond your control likely induces a sense of concern about inconveniencing others. However, dwelling on this doesn't serve you well, as it is ultimately outside of your control.

In today's fast-paced world, excessive stress rarely contributes positively to your performance and can even jeopardize your health. To shed light on the physiology of stress responses and offer strategies for shifting from distress (bad stress) to eustress (good stress), let's focus on cortisol, commonly known as the "stress hormone."

Cortisol, produced by the adrenal glands, ramps up the activity of vital organs such as the heart, lungs, and muscles, boosting your ability to function both mentally and physically at heightened levels. While this surge is advantageous in short bursts, such as during moments of adrenaline rush, prolonged exposure to elevated cortisol levels, as observed in chronic stress, can prove harmful. The complexity surrounding cortisol and its impact on health and performance arises from its dual role as both a necessary and potentially harmful hormone, depending on its concentration within your body.

Let’s take a moment to understand the role cortisol plays in your health.

Role of Cortisol: Often dubbed the "stress hormone," cortisol is synthesized by the adrenal glands and plays a pivotal role in various bodily functions, including metabolism regulation, blood sugar control, inflammation reduction, and memory formation. It's indispensable for coping with stress.

Benefits of Optimal Cortisol Levels: In appropriate quantities, cortisol is essential for maintaining overall well-being and performance. It aids in preserving bodily equilibrium, furnishes the energy required to tackle stressors, and facilitates recovery following physical or mental strain.

Challenges Associated with Low Cortisol Levels: Inadequate cortisol levels can lead to conditions like Addison's disease, characterized by symptoms such as fatigue, muscle weakness, weight loss, and diminished stress-coping abilities. Insufficient cortisol levels may impede effective responses to everyday stressors, thereby affecting overall health and performance.

Adverse Effects of Excessive Cortisol Levels: Conversely, prolonged elevation of cortisol levels, often attributable to chronic stress, can be detrimental. It may precipitate conditions like Cushing's syndrome and is linked to various health issues such as hypertension, weight gain, sleep disturbances, and compromised immune function. Heightened cortisol levels can impair cognitive function, diminish muscle mass, and reduce bone density.

Striving for Cortisol Balance: The key lies in maintaining an equilibrium. Managing stress through mindfulness practices, regular exercise, and ample sleep can aid in regulating cortisol levels. Recognizing that cortisol isn't inherently detrimental but rather necessitates balanced levels is pivotal for optimizing health and performance.

The importance of cortisol balance is critical, and moderation is key. Cortisol, alongside adrenaline, surges into the bloodstream in response to stress, heightening the activity of organs and muscles. While advantageous in the short term, prolonged exposure to elevated cortisol levels can prove detrimental. Chronic stress, characterized by prolonged stress elevation, is associated with severe health implications.

Research from Harvard Medical School underscores the contribution of chronic stress to health issues like hypertension, heart disease, diabetes, obesity, anxiety, and depression.

The 2010 Stress in America Survey by the American Psychological Association revealed that 75% of individuals experience stress levels putting them at risk for chronic illnesses such as cardiovascular disease, diabetes, cancer, and depression.

Five Tips for Optimizing and Balancing Stress/Cortisol Levels:

Nature Therapy: Spending time amidst natural settings can lower cortisol levels, resting heart rate, and blood pressure. Nature's intricate patterns, such as those seen in leaves and the sky, confer inherent benefits to our well-being. Exposure to natural environments fosters stress reduction, as proposed by the "restoration theory," underscoring nature's stress-alleviating effects.
Cold Showers: Concluding your morning routine with a brief blast of cold water can activate the body's "fight or flight" response, releasing cortisol and adrenaline, potentially bolstering immune function. Studies indicate that individuals incorporating cold showers into their regimen report fewer sick days, suggesting a temporary increase in immune activity.
Smiling: Deliberate smiling can expedite cortisol level reduction, especially following stress-inducing activities such as public speaking. Moreover, smiling releases neurotransmitters like dopamine, endorphins, and serotonin, heightening feelings of happiness. Research indicates that intentional smiling post-stressful events accelerates cortisol reduction compared to other facial expressions, showcasing the direct influence of physical actions on stress levels and mood.
Regular Exercise: Engaging in physical activity serves as a potent stress reliever, moderating cortisol levels while enhancing overall health. Opt for activities that resonate with you to ensure consistency. Chronic physical activity correlates with a more regulated cortisol response to stress over time, reflecting improved regulation of the hypothalamic-pituitary-adrenal (HPA) axis. While acute exercise may temporarily elevate cortisol levels, habitual exercise fosters a balanced and resilient HPA axis, potentially lowering baseline cortisol levels and augmenting stress management capabilities.
Mindful Relaxation: Practices like meditation, yoga, and deep breathing exercises significantly mitigate stress and aid in cortisol level management. Mindfulness and meditation exert a profound influence on cortisol levels by modulating the hypothalamic-pituitary-adrenal (HPA) axis, the body's central stress response system. These practices activate the parasympathetic nervous system, often dubbed the "rest and digest" system, counteracting stress-induced activation of the sympathetic nervous system and HPA axis.

During mindfulness and meditation, the production of corticotropin-releasing hormone (CRH) in the hypothalamus decreases, leading to reduced secretion of adrenocorticotropic hormone (ACTH) by the pituitary gland. Consequently, adrenal cortex stimulation diminishes, resulting in reduced cortisol production and release.

Understanding and effectively managing stress (and thus cortisol) levels are imperative for maintaining optimal health. Simple lifestyle modifications can yield profound effects on stress levels and overall well-being. However, it's important to note that while these suggestions are beneficial, they do not substitute professional medical advice, particularly concerning stress-related health conditions.

Source: https://mailchi.mp/thewellsgroup/can-taking-a-sauna-improve-my-health-performance-1251272?e=ce7c3b83aa

The Power of Reframing Endings

Thu, 15 Feb 2024 21:32:04 GMT

For most events in life, there’s a beginning, a middle and an end. Rationally, this is a simple thought to accept. In practice however, the end can feel uncomfortable, emotional, or even dreaded. Endings and change can feel sad or final. Sometimes endings can even feel like failure. However, dreading or avoiding endings could potentially rob us of possibilities for progress and growth. Endings are simply transitions, and life is guaranteed to be full of those.

What if you reframed your thoughts around life transitions, or endings, to promote happiness and growth? Endings are a normal, inevitable, and important part of being alive — like graduations or the new year. Rather than feeling defeated by life's transitions, what if you focused on what you have learned and gained. Unfortunately, common attitudes toward endings – whether of relationships or careers – is much less sanguine. Everyone wants the movie-style “happy ending” of getting married or landing a dream job. However life doesn’t roll its credits after those high notes, and when careers or families don’t endure, nobody breaks out the champagne and party hats. Instead, it's often believed that these endings are tragic failures. By shifting your perspective, you could think of endings as a natural part of life.

Graduating from high school, moving out of your childhood home, and graduating from college all entail an ending, which probably felt exciting and promising. I'm sure you can recall a time where you've felt ready to take on the challenges of the unknown. You likely viewed those life transitions as positive changes. However, between childhood and adulthood, you may have experienced a radical shift in your beliefs about the value of change. Standards of life-long stability in our relationships, marriages, homes, and careers are imposed on you. People often undertake strenuous, sometimes depleting, efforts to ensure continuity. But as any parent, Buddhist, or biologist will tell you, life is continuous change. Besides death and taxes, change is the one thing you can count on. You develop and change over the course of your life, reaching different stages, developing different perspectives, and becoming different physically, intellectually and emotionally. Dread of change is also, unintentionally, a rejection of progress. If nothing ever changes, then it can’t — and you can’t — get better. The tendency to make continuity the primary focus means you overlook the dividends of the serious investments of time, energy, self-control and brain power that you invest in relationships and careers over time. Hopefully, like children advancing grade to grade, you learn enough to prepare for the next stage in your life, as a friend, a partner, a parent or a worker.

Instead of feeling like you've failed when a chapter ends, perhaps you could remember that feeling when you graduated, focusing on growth, rather than loss. Instead of being furious at the person or event that pushed you out into the world, perhaps you could embrace them as liberators, or mentors to whom you are grateful. After all, they taught you well, even when what you learned includes that the person or thing that you loved and hoped might last, is no longer right for you. And sometimes the most important change you can make is to remove yourself from an unfit situation. Even negative circumstances can bear important lessons about what to avoid in the future, and your own courage to escape and stand on your own.

While endings can be painful, and a long-term relationship or job shouldn’t be ended lightly, many endings are likely to be part of your life. Embrace the inevitability of change that is life and view yourself as a graduate of the school of life. Rather than feeling defeated by the passing of any life stage, try focusing your energy on the opportunity ahead. As with each new year, every major life transition should be a time to think about what you have gained and celebrate your progress. As 2024 gets underway, I hope you resolve to embrace the endings in your life with grace, humor, and most of all, gratitude.

Source: : https://www.psychologytoday.com/ca/blog/human-development-for-dummies/202401/the-joy-of-endings

Aging in Place

Thu, 15 Feb 2024 21:32:02 GMT

Forget the Roses, Here are all the Tips for Aging in Place

As people age, the desire to remain in their own homes becomes increasingly significant. AARP reports that a substantial 77% of adults aged 50 and above express a preference for long-term residence in their current dwellings. However, despite this aspiration, many individuals delay essential home improvements necessary to facilitate aging in place.

Carol Chiang, CEO of Evolving Homes, which offers tailored consulting for those wishing to age in place, highlights a common oversight: people often express the desire to age in place without fully considering what it entails. Chiang's clientele typically falls into three categories: those with urgent needs following an incident, individuals with neurodegenerative

conditions, and proactive adults planning for the future. She emphasizes the foresight of the latter group, who understand that addressing issues early on can prevent higher costs later.

Carolyn McClanahan, a certified financial planner, and physician, who sought Chiang's expertise for her own home, stresses the importance of planning for aging-friendly modifications, especially for those without children. Remodeling every decade or so, particularly in one's 50s and 60s, can greatly enhance the feasibility of remaining at home as one ages.

The costs associated with such modifications can vary depending

on location and project scope. While Chiang suggests budgeting at least $70,000

for basic remodels, Curt Kiriu, an aging-in-place specialist, notes that costs

can range from $30,000 to $80,000. However, these costs pale in comparison to

the ongoing expenses of nursing home care.

Moreover, home upgrades not only enhance livability but also increase property value. Features such as wider doorways and no-step entries, part of universal design principles, can boost a home's value by up to 30%. To ensure successful home modifications, experts advise starting as early as possible and prioritizing functionality over aesthetics. Additionally, seeking professional assistance, such as a certified aging-in-place specialist or an occupational therapist, can help tailor modifications to individual needs.

Thinking beyond the bathroom is also crucial, as accessibility begins at the entry point. Professional evaluations can pinpoint areas requiring modification, such as installing grab bars or converting tubs to curb-less showers. Homeowners should also declutter their spaces to enhance accessibility and safety.

Financial planning is equally crucial for aging in place, as care expenses can vary widely depending on individual circumstances. Having a contingency plan for when aging in place is no longer feasible is essential, including exploring alternative care options like assisted living facilities.

Aging in place requires proactive planning, both in terms of home modifications and financial preparation, to ensure a safe and comfortable living environment as one grows older.

Source: https://www.cnbc.com/2024/02/03/here-are-things-to-consider-if-you-want-to-age-in-place-in-retirement.html

2024 Tax & Retirement Planning

Thu, 15 Feb 2024 21:32:01 GMT

Tax & Retirement Planning 2024

2024 Important Dates*

• RRSP Contribution Deadline : February 29, 2024 for contributing to an RRSP for the 2023 tax year.

• Individual tax filing deadline: April 30, 2024

• Payment date for 2023 taxes: If you owe money to the CRA, the amount must be paid by April 30, 2024 for individual and self-employed returns.

• Self-employed tax filing deadline: June 17, 2024

• Quarterly deadlines if you pay taxes to CRA by instalments:

March 15, 2024

June 17, 2024

September 16, 2024

December 16, 2024

* 2024 important dates are subject to change.

Federal Tax Brackets & Rates

Taxable Income Rate Up to $55,867 15.0%

Over $55,867 to 111,733 20.5%

Over $111,733 to 173,205 26.0%

Over $173,205 to 246,752 29.0%

Over $246,752 33.0%

Source: Income tax rates for individuals - Canada.ca

2024 Payroll Deductions*

Maximum EI Premium2 $1,049.12

Maximum CPP Contribution3

$3,867.50 Top Federal Tax Rate 33%

*Figures rounded to nearest dollar

2024 BC Top Marginal Personal Tax Rates*

Interest and Regular Income: 53.50%

Capital Gains: 26.75%

Eligible Canadian Dividends: 36.54%

Non-eligible Canadian Dividends: 48.89%

*The combined top marginal tax rate is the rate an individual will pay on income that falls into the highest tax bracket in the province or territories of residence. Non-resident rates for interest and dividends apply only in limited circumstances.

Tax-Free Savings Account (TFSA) Contribution Limits

Annual Contribution Limits*

2009-2012: $5000

2013-2014: $5500

2015: $10,000

2016-2018: $5500

2019-2022: $6000

2023: $6500

2024: $7000

*The TFSA annual room limit will be indexed to inflation and rounded to the nearest $500.

Source: CRA: Ernst & Young Combined Federal and Provincial Personal Income Tax Rates 2024, PwC Individual - Taxes on Personal Income, CRA, Régie des rentes Québec (RRQ)

Registered Retirement Savings Plan (RRSP) Contribution Limits

18% of Previous Year’s Earned Income to a Maximum of:

2016: $25,370

2017: $26,010

2018: $26,230

2019: $26,500

2020: $27,230

2021: $27,830

2022: $29,210

2023: $30,780

2024: $31,560

Source: https://www.canada.ca/en/revenue-agency/services/tax/registered-plans-administrators/pspa/mp-rrsp-dpsp-tfsa-limits-ympe.html

Payment Rates - Canada Pension Plan (CPP)

Type of Benefit CPP Maximum Monthly Benefit (2024)

Retirement Pension (At Age 65) $1,364.60

Disability Pension (Under Age 65) $1,606.78

Survivor's Benefit (Under Age 65) $739.31

Survivor's Benefit (Age 65 and Over) $818.76

Children of Disabled Contributor Benefit $294.12

Children of Deceased Contributors Benefit $294.12

Combined Survivor's and Retirement Benefit $1,375.41

(Retirement At Age 65)

Combined Survivors and Disability Benefit $1,613.54

Death Benefit (Max Lump Sum) $2,500.00

Source: Government of Canada from January 2024 to December 2024, Government of Canada Quarterly Report of CPP and Old Age Security (OAS) monthly amounts from January to March 2024, Régie des rentes Québec (RRQ).

Old Age Security Benefit Payment Rates*

Type of Benefit Recipient Maximum Monthly Maximum Annual

Benefit Income 1

Old Age Security All Recipients $713.34 $142,609 2

(OAS) Pension

Guaranteed Single Person $1,065.47 $21,624

Income Spouse of Pensioner $641.35 $28,560 3

Supplement (GIS) Spouse of Non-Pensioner $1,065.47 $51,840 3

Spouse of Allowance Recipient $641.35 $39,984 3

Allowance All Recipients $1,354.69 $39,984 3

Allowance for All Recipients $1,614.89 $29,112 4

the Survivor

*For eligible recipients aged 65 to 74. OAS benefits are reviewed quarterly and generally indexed to Consumer Price Index (CPI).

1.The income level cut-offs do not include the OAS pension or the first $5,000 of employment income.

2.Combined income. Eligible recipients aged 75 and over will see an automatic 10% increase of their OAS pension as of July 2024.

3.Individual income.

Source: Government of Canada from January 2024 to December 2024.

For a Comprehensive List of 2024 Tax & Retirement Planning from TD Asset Management, click here.

The Benefits of Regular Stretching

Tue, 16 Jan 2024 21:09:50 GMT

January screams New Year Resolutions to most of us. Goal setting is always a good thing! However, with an abrupt change to your bodies routine, it’s easy to forget the golden rule of stretching your muscles as much as you work them . Especially with busy schedules, sometimes the only time you can dedicate, is time for exercise alone. So often stretching becomes an easy oversight. So what better than a list of benefits of stretching to keep it front of mind. Prioritizing stretching can prevent so many injuries and extend the success and routine of your hard work.

Regular stretching offers so many advantages. It not only enhances flexibility, a crucial aspect of fitness, but also contributes to improved posture, stress reduction, alleviation of body aches, and more. Here are some top benefits of stretching and guidance on beginning an effective stretching routine.

Top Benefits of Stretching:

Increases Flexibility: Regular stretching is vital for overall health, promoting flexibility that facilitates everyday activities and helps counter reduced mobility associated with aging.
Expands Range of Motion: Consistent stretching enhances the ability to move joints through their full range, providing increased freedom of movement. Both static and dynamic stretching methods effectively contribute to this.
Enhances Physical Performance: Dynamic stretches prior to physical activities prepare muscles for exertion, potentially improving performance in athletic events or exercises.
Boosts Blood Flow: Regular stretching improves circulation, shortening recovery time and reducing muscle soreness by increasing blood flow to the muscles.
Improves Posture: Combining strength and stretching exercises can alleviate muscle imbalances, reduce musculoskeletal pain, and promote proper alignment, consequently improving posture.
Aids in Back Pain Management: Stretching can help heal existing back injuries and prevent future pain by maintaining muscle flexibility and strength.
Stress Relief: Stretching alleviates muscle tension, providing relief during stressful periods, especially in areas prone to stress, such as the neck, shoulders, and upper back.
Promotes Mental Calm: Engaging in a regular stretching program not only increases flexibility but also allows for mindfulness and meditation, providing a mental break.
Reduces Tension Headaches: Stretching, along with proper diet, hydration, and rest, may contribute to reducing tension and stress headaches.

Stretching Techniques:

Several stretching techniques exist, including dynamic, static, ballistic, PNF, passive, and active stretching. The most common forms are static (post-exercise) and dynamic (pre-exercise).

Tips for Stretching:

Use dynamic stretches before exercise and static stretches after to minimize injury risk.
Focus on major areas for mobility, such as calves, hamstrings, hip flexors, and quadriceps.
Hold each stretch for 30 seconds, avoiding bouncing.

Starting a Stretching Routine:

Begin slowly to allow your body to adjust.
Ensure proper form and technique to prevent injuries.
Incorporate dynamic stretches before and static or PNF stretches after exercise.

Risks and Safety Tips:

Consult your doctor for stretches if you have an acute or existing injury.
Seek advice from a specialist for chronic injuries.
If physical limitations exist, consult a doctor for alternative exercises.
Avoid bouncing, stretch within comfort, and refrain from overdoing it.
Warm up before stretching, especially if not exercising beforehand.

Regardless of fitness level, a regular stretching routine offers benefits such as increased range of motion, improved posture, and mental well-being. Following safety guidelines ensures a productive and injury-free stretching experience.

Source: https://www.healthline.com/health/benefits-of-stretching#safety-tips 9 Benefits of Stretching: How to Start, Safety Tips, and More (healthline.com)

How To Divide the Assets of an Estate Between Beneficiaries

Tue, 16 Jan 2024 21:09:47 GMT

Three siblings find themselves as the beneficiaries of their parents' estate, which encompasses multiple properties and investment accounts. The challenge lies in the equitable division of these assets. The parental wealth portfolio, comprising five properties, five cars, numerous bank accounts, and various wealth management accounts, is

intended to be divided into three equal parts, as per the parents' wishes. However, the task isn't straightforward due to varying asset values and differences in preferences regarding retention, sale, and different timeframes.

To address these complexities, a consideration arises for establishing a trust to consolidate all assets. The primary concern is ensuring equal distribution, especially if any assets are sold. Each sibling's name is

listed as the primary on assets, with the other two designated as successor beneficiaries.

The division of an estate between beneficiaries is a complex process. Wills often grant trustees discretion to manage and sell estate components as deemed fit. A trustee may also distribute specific assets to beneficiaries, allowing for flexibility in choosing assets of interest. However, given that the siblings' names are already on the properties and

accounts, they possess the freedom to make decisions.

Regarding joint ownership or selling of assets, selling and distributing the remaining cash to beneficiaries is a common practice after settling taxes and estate costs. If sentimental value is attached to real estate, direct distribution to multiple beneficiaries might be considered.

For continued joint ownership of real estate as investments, options include joint tenancy with the right of survivorship or joint tenants in common, providing control even after one sibling's demise. Alternatively, a

co-ownership agreement can be crafted to address potential disagreements or expenses.

While the idea of setting up a trust has been mentioned, it may be deemed burdensome and unnecessary due to associated legal and accounting fees. A more straightforward option could be to agree on selling the assets and

dividing the proceeds or housing specific properties as part of the inheritance.

Considering investment accounts, which have a primary owner and successor holders, potential complexities arise in managing joint accounts. A suggestion is to divide the funds into individual accounts, providing autonomy

over investments.

Given the dynamic nature of life and changing intentions, the suggestion is made to reconsider holding all assets jointly. Naming each other as beneficiaries might not be the most optimal long-term approach. Exploring

the division of investments and potentially real estate, while seeking legal and tax advice, is recommended to navigate this intricate situation.

Source: www.moneysense.ca

January Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Tue, 16 Jan 2024 21:09:43 GMT

As we start the new year, let’s quickly review the 2023. Investors faced many challenges last year including inflation, interest-rate increases, geopolitical conflicts, and a slowing global economy. That said, those who were patient and rode out the volatility were rewarded.

After several years of challenging returns, equity and bond prices rose amid signs of a slowing global economy and the possibility that central banks may begin to decrease interest rates in 2024. The S&P 500 Index, S&P/TSX Composite Index, were up 24.2% and 8.1% in 2023.

Bonds also did well —Canadian and U.S. bonds (measured by the FTSE Canada Universe Bond Index and the Bloomberg U.S. Aggregate Bond Index) were up 6.7% and 5.5%.

There has been lots of optimism about bonds, which has been slower to materialize than predicted but did ultimately materialize. While yields are likely decreasing this year, it’s important to be nimble with your bond investments. As with stocks, if you missed out on a few days in the year, the return on your portfolio can be materially different.

Here's a closer look at what we might expect in 2024, from Manulife investments:

Global economy: High interest rates are likely to have weakened the global economy. We believe we will experience a further slowdown in early 2024. Low unemployment and strong business growth in the United States suggest a mild-to-moderate recession is probable. Canada’s economy is much more sensitive to interest-rate changes and, therefore, could be more vulnerable.

Inflation: Higher interest rates may have slowed growth and eased inflation as intended, but the last leg of the inflation battle may be more difficult. As it stands, inflation at current levels could set the stage for central banks to pause increases and eventually cut interest rates in 2024.

Geopolitics: Investors have been losing sleep over the conflict in the Middle East, which erupted in October, in addition to the ongoing situation in Ukraine. Historical market trends often show that geopolitical events can cause short-term volatility, but markets tend to recover over the longer term.

Over the coming year, we believe both equity and bond investors will benefit from falling interest rates, translating to rising stock and bond prices. However, there’s likely to be fluctuations along the way as the market responds to unexpected economic data.

Now is not the time to feel paralyzed as an investor. In fact, historical trends suggest that this could be an opportunity. While past performance is not an indicator of future returns, history shows that investing in robust, resilient companies during periods of volatility can lead to favorable outcomes over the long term.

Source: Manulife Investment Management, Capital Markets Strategy, as of December 31, 2023

10 SMART Financial Goals for 2024

Tue, 16 Jan 2024 21:08:39 GMT

10 SMART Financial Goals for 2024

As we embark on a new year, it's time to set our sights on financial empowerment through strategic planning. If the holiday season has left your bank account a bit depleted, consider adopting a SMART approach to set ten impactful financial goals for 2024. In this guide, we'll explore the SMART system and provide examples to help you navigate your financial journey.

Before delving into specific goals, let's understand the SMART criteria.

To avoid kicking yourself for not reaching your goals, let's make sure they are attainable! Here is our favorite acronym when it comes to goal setting:

S - Specific : Avoid vague goals like "become financially stable." Instead, specify actions like reducing debts. For instance, aim to pay off a portion of your largest debt.

M - Measurable : Set quantifiable targets to track progress. If tackling debt, calculate monthly payments. Regularly assess your progress, adjusting as needed to stay on course.

A - Achievable : Ensure goals are realistic. For instance, setting aside $200 from each paycheck to pay off credit card debt is achievable, considering other financial responsibilities.

R - Realistic : Align goals with your budget. While paying off $50,000 in student loans in a year may be ambitious, tailor your objectives to your financial capacity.

T - Time-Bound : Establish a timeframe for your goals. If aiming to eliminate 30% of your largest debt, determine monthly contributions, preventing last-minute rushes.

Now, let's explore ten SMART financial goals for 2024:

Build an Emergency Fund: Goal: Save gradually to cover three to six months of expenses. Utilize high-interest savings accounts or tax-free savings accounts for quick accessibility during emergencies.
Start a "Fun Fund": Goal: Create a sinking fund for discretionary expenses like travel. Intentionally save to avoid relying on credit cards, ensuring a stress-free approach to indulging in personal luxuries.
Take a Financial Course: Goal: Enhance financial literacy by exploring free courses or investing in specialized programs. Expand your knowledge to make informed decisions about saving, investing, and taxes.
Utilize Credit Card Rewards: Goal: Maximize credit card rewards for purchases at preferred stores or travel. Strategically use rewards to offset expenses and avoid accumulating unnecessary debt.
Catch Up on Unpaid Taxes: Goal: Settle any outstanding taxes with the assistance of an accountant or online tax software. Timely filing prevents penalties and fosters financial responsibility.
Hire a Financial Planner: Goal: Consult with a fee-only financial planner to clarify goals and create a comprehensive financial plan. Seek professional guidance tailored to your unique situation.
Invest in Appropriate Risk Investments: Goal: Allocate funds to appropriate-risk investments and diversified options. Balance risk and return based on your financial objectives.
Make a Will and Powers of Attorney: Goal: Establish a will to dictate the distribution of assets and prevent potential complications. Ensure your wishes are honored and loved ones are protected.
Consider Critical Illness and Disability Insurance*: Goal: Evaluate the need for critical illness and disability insurance to safeguard against unforeseen health challenges. Prioritize financial protection in case of extended illness or injury.
Engage an Accountant for Tax Optimization: Goal: If you are self-employed or engaged in a side hustle, the complexity of your tax situation may increase with business growth, potentially placing you in a higher income tax bracket. Aim to hire an experienced accountant to navigate the intricacies of your financial landscape. Collaborate with them to minimize your tax liability and ensure strict adherence to tax regulations, fostering both financial efficiency and legal compliance.

Embarking on a journey towards financial prosperity in 2024 involves setting SMART goals that align with your aspirations and capabilities. Whether building an emergency fund, investing wisely, or seeking professional guidance, a strategic approach ensures a more secure financial future. Take the first step towards financial empowerment today.

December Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Fri, 15 Dec 2023 19:32:33 GMT

November proved to be an exceptional month for both stocks (the best in 4 decades!) and bonds with the expectation that the Federal Reserve is nearing the end of its interest rate hiking cycle and December is continuing that positive market trend. The S&P 500 i s on track to increase for 7 straight weeks.

Among sectors in the S&P500 communication services and consumer discretionary rose more than 1% each last week, with technology, industrials and health care also notching gains. Energy posted the steepest decline at 3.3%, while materials, consumer staples, real estate, utilities and financials also closed lower.

More economic data seems to point towards a soft landing for the U.S. economy, including higher-than-expected U.S. Q3 GDP growth and a further drop in inflation, although nothing is for certain. There are still many pundits who believe a recession will occur.

Canada’s S&P/TSX Composite Index was 7.2% higher in November, as all of its underlying sectors were positive during the month. The information technology sector was the largest contributor to the index return, with a rise of 27.3% in November. The financials, real estate and telecommunication services sectors also rose by 9.8%, 7.8% and 7.1%, respectively.

For bonds, Canadian investment grade bonds, as measured by the FTSE Canada Universe Bond Index, rose 4.3% during the month, while the key global investment grade bond benchmark and global high-yield issues were up 5.0% and 4.8%, respectively.

Turning to commodities, natural gas prices fell 21.6% during the month, while the price of a barrel of crude oil fell 6.2%. Copper, silver and gold had a positive month, rising 4.9%, 10.2% and 2.2%, respectively.

Here are the YTD returns to Dec 13:

S&P 500 22.6%

TSX (Canada) 6.4%

One economist I admire is Frances Donald from Manulife. Here is a good article from her discussing their thoughts on recession on not.

Frances Donald

Let me know if you have any questions.

Sources: Bloomberg, Y Charts and IA Private Wealth.

Year End Tax Planning

Thu, 14 Dec 2023 18:30:39 GMT

As the end of the year quickly approaches, we recommend exploring potential tax planning opportunities for 2023. The following considerations are not personalized advice, and we always recommended consulting with your Financial Advisor or accountant before implementing any suggestions.

Owner-Manager Remuneration:

Optimize the mix of salaries and dividends for owner-managers to minimize taxes, considering factors like RRSP entitlements, CPP contributions, Tax on Split Income, and BC Employer Health Tax. Income splitting may be feasible if family members provide services.

Lifetime Capital Gains Exemption:

The lifetime capital gains exemption limit for 'qualified small business corporation' shares has increased to $971,190 in 2023, indexed to inflation for future years.

Personal Income Tax Rates:

The combined federal and provincial top marginal tax rate remains at 53.50%, applicable for income exceeding $240,000. Maximum marginal tax rates for eligible and regular dividends are 36.54% and 48.89% in 2023, respectively.

Principal Residence Rules:

The principal residence exemption reduces gains on property disposition. New anti-flipping rules apply from 2023, and late principal residence designations may incur penalties.

Trust Income Allocations:

Unallocated income in inter vivos trusts is taxed at the highest personal tax rate. Allocate trust income to beneficiaries by December 31, 2023.

Review Your Will:

Changes to the Income Tax Act in 2016 affect certain trusts. Consider tax implications and update your estate plan, especially if making charitable gifts through your will.

Low-Interest Loans:

Utilize the CRA's prescribed interest rate of 5% for income splitting with family members through related party loans. Payments must be made before January 30, 2024.

Capital Losses:

Offset capital gains by realizing capital losses before December 31, 2023. Be cautious of the superficial loss rule if repurchasing the same investments.

RRSP Contributions:

Contribute to RRSP by February 29, 2024, for a deduction on your 2023 tax return. Consider contribution limits, unused room, and special considerations for individuals turning 71 this year. (Individuals turning 71 this year have until December 31st to make a final contribution to their RRSP, potentially lowering their tax bill significantly).

Note: Another potential move for individuals turning 71 this year involves over-contributing to your RRSPs in December if you have earned income that will generate contribution room in 2024. This strategy, albeit with a small penalty tax of 1% of the overcontribution less $2,000, allows individuals to take advantage of the increased contribution limit in the following year.

Spousal RRSP:

Spousal RRSP contributions present another opportunity. You can contribute to your spouse (or common-law partner’s) RRSP until December 31st of the year they turn 71. By contributing to a spouse's RRSP before year end, individuals can start the clock on the attribution period sooner as it’s based on calendar years, potentially leading to tax benefits.

RRIF Withdrawal:

If you're 65 or older and not using the pension income credit, withdrawing $2,000 from a Registered Retirement Income Fund (RRIF) qualifies for the credit and can be used for income splitting purposes.

Delaying Certain Actions:

Delaying certain financial actions such as the realization of capital gains until January can defer taxes to the next year. For the Home Buyers' Plan or Lifelong Learning Plan , delaying withdrawals to the new year postpones your repayment schedule by a year. (If you're considering investments in mutual funds or segregated funds, be aware of potential year-end taxable distributions or allocations).

Allowable Business Investment Losses:

Realize Allowable Business Investment Losses by selling shares or debt of financially unviable private businesses before December 31, 2023.

Year-End Planning for Certain Investments:

Time purchases and sales of investments strategically to manage taxable income. Delay purchasing certain investments until January 2024 for tax efficiency.

Tax-Free Savings Account (TFSA):

Contribute up to $6,500 for 2023 and $7,000 for 2024. Unused contribution room carries forward, and TFSA offers flexibility and tax-free withdrawals.

First Home Savings Account (FHSA):

Open a First Home Savings Account (FHSA) to start accumulating contribution room. Since unlike TFSAs, contribution room does not automatically accrue and unlike RRSPs, contributions in the first 60 days of 2024 can not be used for 2023.

Registered Disability Savings Plan (RDSP):

Set up an RDSP for eligible individuals, providing tax benefits on contributions and tax-free growth within the plan.

Registered Education Savings Plan (RESP) Contributions:

Contribute to an RESP by December 31, 2023, to qualify for the Canada Education Savings Grant. Consider income limits and other eligibility criteria.

Defer a Bonus:

Discuss with your employer the possibility of deferring a 2023 bonus until January 2024 to defer tax payments.

Interest Deductibility:

Ensure loan interest deductions meet the criteria. Consider deductibility of life insurance premiums assigned as collateral for a loan.

Investment Counseling Fees:

Deductible for non-registered accounts. Fees for managing registered accounts are not deductible.

Review Your Personal Use of Employer-Provided Automobiles:

Consider the tax implications of personal use of company-owned vehicles, especially the standby charge.

Purchasing Business Assets:

Purchase business assets before year-end for early capital cost allowance claims and GST credit eligibility.

Moving Expenses:

Deductible if moving within Canada for employment or business reasons. Maintain a detailed log for CRA audit purposes.

Charitable Donations:

Make charitable donations before December 31, 2023, to qualify for tax credits. Consider donating appreciated securities for additional tax benefits.

Political Donations:

Qualify for tax credits by making political donations before December 31, 2023, adhering to federal and provincial limits.

Medical Expenses:

Ensure medical expenses are paid within any twelve-month period ending in 2023 to qualify for a tax credit.

Adoption Costs:

Claim a tax credit for adoption-related expenses, up to a maximum of $18,210 per child.

Child Care Expenses:

Deduct childcare expenses within specified limits, considering age, disability, and earned income of the claimant.

Canada Child Benefit:

Ensure timely filing of tax returns to receive the tax-free Canada Child Benefit, recalculated annually based on income.

Spousal Support and Maintenance:

Deductible for the payer and included in the income of the recipient. Exception for child support payments.

Home Accessibility Tax Credit:

Claim up to $20,000 in eligible expenditures per calendar year for qualifying individuals, enhancing home accessibility.

Eligible Educator School Supply Credit:

Teachers and early childhood educators can claim a refundable tax credit for eligible teaching supplies.

Students:

Utilize tax exemptions for scholarship income, claim tuition credits, and consider reporting foreign university tuition fees.

B.C. Volunteer Firefighters and Search and Rescue Volunteers Tax Credit:

Claim a credit for individuals providing volunteer service to fire departments or eligible search and rescue organizations.

File Tax Returns for All Family Members:

Ensure all family members file tax returns to accumulate RRSP contribution room and qualify for certain benefits.

Offshore Investments:

Comply with reporting requirements for specified foreign property and foreign affiliate holdings. U.S. citizens living in Canada must also meet U.S. tax obligations.

The comments contained herein are a general discussion of certain issues intended as general information only and should not be relied upon as tax or legal advice. Please obtain independent professional advice in the context of your particular circumstances.

Tax-Free First Home Savings Accounts Now Available!

Wed, 13 Dec 2023 22:49:13 GMT

What is a Tax-Free First Home Savings Account (FHSA)?

A new tax-advantaged account designed to help Canadians save for their first down payment.
Combines the power of the TFSA and RRSP to help first time home buyers. Think of it as a hybrid!
Contributions to the FHSA are tax deductible, while withdrawals are tax-free, giving you the best of both worlds while investing for your home purchase.
Contribute up to $8,000 per year once opened, up to a lifetime maximum of $40,000

Who is eligible to to open a FHSA?

Canadians between the ages of 18 and 71.
Those who have not lived in a home that they or their partner have owned in the current calendar year or any of the previous 4 calendar years.
Those saving for their first purchase of a qualifying home in Canada.

For more information about the new FHSA, reach out to us at your convenience.

TFSA Limit Increased for 2024

Wed, 13 Dec 2023 22:47:08 GMT

CRA has announced an increase in Tax Free Savings Account (TFSA) from $6,000 per year to $6,500 for 2024. The $500 increase is a reflection of the current inflationary environment of rising commodity prices, geopolitical tensions, red hot gas prices, and supply chain disruptions which have all contributed to inflation.

The TFSA is an extremely flexible registered account, the benefits of which can be leveraged to create massive wealth over the long-term. Any withdrawals from the TFSA in the form of capital gains, interest, and even dividends are exempt from CRA taxes, making it the most convenient account to invest within.

This new limit means that a taxpayer who has never contributed to a TFSA and has been eligible for one since its inception will have a cumulative contribution room of $88,000.

Reach out to our team today to make sure you and your loved ones are utilizing the new limit to its full potential!

Sleep Well, Live Well

kelsey@rightdirectionfinancial.ca (Kelsey Maxwell) — Wed, 13 Dec 2023 22:40:16 GMT

One subject I will never grow tired of discussing is the importance of sleep for our health and happiness. Without a good night’s sleep, it can be difficult to show up for others and ourselves the way we’re otherwise capable of. Sleep allows us to perform mentally and emotionally. It helps us fight viruses and diseases, allows our bodies to physically recover, as well as our hormones to balance. When we’re well-rested, we are all around able to live our life to the fullest. Besides water, I can’t think of anything more essential for our well-being.

While getting a regular good night’s sleep is easy to preach, depending on several unique factors, it can be difficult in practice. Our team searched for some practical tips to help you build a sleep routine if you are one who struggles with sleep. Dr Greg Wells is one of the world’s leading lifestyle coaches and scientists and is passionate about the power of sleep, nutrition, and movement to treat various illnesses and begin to truly thrive. Below are 8 practical tactics he recommends to help you sleep soundly.

1. Avoid Exposure to Bright Light Before Sleep: Light, especially from screens, disrupts melatonin production, the hormone that makes you sleepy. To fall asleep quickly and have a restful sleep, avoid bright lights and screen exposure an hour before bedtime.

2. Create a Digital Sunset: Dim the lights in your home in the evening and avoid devices in the bedroom. This reduces light exposure, preparing your body and mind for sleep.

3. Maintain a Dark Sleeping Environment: Keep your sleeping area dark. Even small light sources like an alarm clock or hallway light can disrupt sleep. A dark room supports deeper, more restorative sleep stages.

4. Engage in Flow Activities: Participating in activities where you're completely immersed and focused, known as 'flow states', can improve your mental state and lead to more restful sleep. This psychological state is characterized by being fully engaged, productive, and often losing track of time.

5. Consume Antioxidant-Rich Foods: Diets high in antioxidants, such as the DASH diet, benefit your overall health and can positively impact sleep. Focus on eating plant-based foods like berries, spinach, beans, oats, and ginger.

6. Incorporate Healthy Fats into Your Diet: Omega-3 fatty acids found in flaxseed, canola oils, chia seeds, walnuts, oysters, and certain fish (like salmon and mackerel) play a critical role in cellular health and stress response, which can influence sleep quality.

7. Optimize Your Vitamin and Mineral Intake: Vitamins such as niacin (vitamin B3), and other B vitamins, along with vitamin C, E, and provitamin A, have antioxidant properties and are important for sleep-related processes. Include foods rich in these vitamins, like fish, poultry, whole grains, fresh foods, fruits, vegetables, nuts, seeds, and vegetable oils in your diet.

8. Practice Gratitude and Altruism: Engaging in acts of gratitude and altruism can enhance your emotional and physiological energy systems. This positive emotional state can translate into better sleep quality.

By integrating these tactics into your lifestyle, you can create a more conducive environment for restful sleep, leading to improved overall health and wellness. Remember, consistent practice and making these tactics a part of your daily routine is key to experiencing their full benefits.

Source: The Foundation of Health Begins with Sleep (mailchi.mp)

The Relationship Between Mental & Physical Health

Mon, 20 Nov 2023 21:30:01 GMT

From childhood, we are taught to seek help when we are physically hurt or unhealthy.

A lingering cough, or a fall that leaves us limping, and we all know to book a doctor’s visit.

Physical health is obvious and visibly treatable, making it typically easy to prioritize, or at least be aware of.

On the other hand, mental health remains invisible.

The World Health Organization (WHO) defines health as a ‘state of complete physical, mental and social well-being and not merely the absence of disease or infirmity’. While progress is being made every day to remove the stigma associated with mental health, the connection it holds with our physical health seems less forefront as a society.

New research however is making it very clear that mental health and physical health are indeed, deeply connected. Studies show that an improvement or decline in one, can lead to an improvement or decline in the other. Nowhere is the relationship between mental and physical health more evident than in chronic conditions. New studies show the following relationships between chronic physical conditions and mental health:

· Poor mental health is a risk factor for chronic physical conditions.

· People with serious mental health conditions are at high risk of experiencing chronic physical conditions.

· People with chronic physical conditions are at risk of developing poor mental health.

Research also shows that mental illnesses may be linked to premature aging in several ways:

· Poor mental health can lead to unhealthy behaviors like poor diet, lack of exercise, and substance use that are bad for physical health.

· Many mental health conditions and the stress they cause can disrupt sleep, which can harm physical health over time.

· Stress can cause chronically elevated levels of cortisol, which can disrupt just about every bodily function, including the digestive system, immune system, cardiovascular system, and even reproductive system.

This can put people at risk for a range of medical conditions, including high blood pressure, heart disease, diabetes, stroke, and cancer.

Never has it been so obvious that mental and physical health are fundamentally linked. With all this evidence, what can we do to maintain both our mental and physical health?

1. Make Regular Exercise a Life-long Habit: The physical and mental health benefits of regular exercise are hard to overstate. It improves muscle mass and function, improves metabolic function, reduces inflammation, strengthens the immune system, improves cardiovascular and respiratory health, and even contributes to better gut microbiome diversity. All those physical health benefits will, in turn, improve mental health because they’re interconnected. But exercise also has direct benefits for the brain, including improved cognitive function, improved executive function, including working memory and impulse control, reduced depression and anxiety symptoms, and reduced stress.

2. Eat a Healthy Balanced Diet : Diet is one of the most important risk factors of illness, but it can also be one of the most confusing lifestyle changes to make. There’s so much conflicting information out there about what you should and shouldn’t eat. Plus, a lot of diet plans ask you to meticulously track things like fiber, protein, and micronutrients. It’s overwhelming. Instead of trying to follow a diet plan or figure out which trending superfood you should be eating, just follow a few basic principles of good nutrition and then don’t stress about it.

- Drink more water. Between three to four liters per day is the general recommendation.

- Eat more fruits and veggies. The recommended five servings work out to about 1 pound per day. Any fresh produce will be good for you, so don’t overthink it.

- Be mindful of processed foods. Even minimally processed and ready-made foods, like bread or soup, can contain a surprising amount of salt and sugar. If you do enjoy these ready-made options, check the label to try to find low-sodium, low-sugar alternatives.

3. Make Time to Just Be : So simple, but so easily overlooked.

Stress is a major factor in the harmful interactions between mental and physical health. Find time to not worry about whether you’re eating the right thing, exercising enough, or being productive enough. Take a few minutes each day to sit down with no TV, no phone, no other distractions and just be.

Notice where you are and what you’re feeling right now. That’s it. Don’t think about what you have to do, or what you should be feeling. Just be for a few minutes. This is often referred to as mindfulness, but don’t let the label pressure you into putting criteria around what you should be doing.

The goal is to just check in with yourself and take a break from the noise of life.

Sources: https://ontario.cmha.ca/documents/connection-between-mental-and-physical-health/

https://www.verywellmind.com/the-mental-and-physical-health-connection-7255857

November Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Tue, 14 Nov 2023 23:13:33 GMT

Inflation and Interest Rates: Stuck in the Middle

It appears that the current economic situation is characterized by a delicate balancing act between government spending, inflation, and interest rates. The ongoing conflict between fiscal and monetary authorities is creating challenges for policymakers and investors alike.

Key points from the provided information:

Government Spending and Inflation:
Governments, particularly since the onset of the pandemic, have engaged in significant spending, leading to large deficits.
The persistent government spending has fueled inflation, creating upward pressure on prices.
Governor Macklem from the Bank of Canada has acknowledged that government spending is expected to grow faster than the economy's supply, contributing to inflation.
Interest Rates and Central Banks:
In response to rising inflation, central banks, including the Bank of Canada and the US Federal Reserve, are faced with the dilemma of keeping interest rates high to combat inflation.
The US Federal Reserve has chosen not to increase interest rates for a second consecutive meeting, indicating that the recent increase in bond yields is currently serving the purpose of tightening financial conditions.
Economic Impact:
The combination of sticky inflation and higher interest rates is taking a toll on consumer confidence, reflected in a drop to a five-month low.
Economic indicators, such as a flat reading in Canadian GDP and a contraction in the US manufacturing sector, suggest challenges for economic growth.
Bond Market Reaction:
The bond market rebounded strongly, influenced by the announcement of smaller-than-expected US Treasury bond issuance for Q4 and the decision of the Fed to keep the overnight rate steady.
Stock Market Reaction:
Investors reacted positively to the perception that central banks may be nearing the end of their rate-tightening cycle.
Small caps, rapid growth companies, high-yield payers, and discounted value stocks performed well, leading to significant gains in both US and Canadian benchmarks.
Earnings Trend:
Strong earnings in the third quarter have marked a positive shift in the negative earnings trend in the US, contributing to the positive sentiment in equity markets.
Market Returns:

Both the TSX/S&P (Canada) and S&P 500 (US) experienced notable gains, with the US market posting a substantial return of 13.7% for the week.

Overall, the narrative suggests a complex economic environment where policymakers are grappling with the consequences of prolonged government spending, inflationary pressures, and the need to manage interest rates to support economic stability. The reactions in bond and equity markets reflect the uncertainty and the delicate balance that exists in the current economic landscape.

Market Returns to Nov 6

Source: Bloomberg.com

Professional Women: Unique Challenges

laura@rightdirectionfinancial.ca (Laura Chanin) — Tue, 14 Nov 2023 23:13:31 GMT

Strategies to help professional women address some life challenges.

Busy women professionals have their own unique life challenges. As careers grow and they become more successful, many women professionals tend to deprioritize getting their finances in order due to their extremely busy schedules. Usually not their fault, and the truth is making time to get your finances in order can be difficult.

Let’s dive into some of these challenges and look at ways to overcome them.

Time Management:

Time is a precious resource for busy professionals. Schedule regular financial check-ins, just like you would for work meetings. Dedicate time to review your financial situation, set goals, and track progress.
Use technology to your advantage. There are various apps and online tools that can automate financial tasks, making it easier to stay on top of your finances.

Income Disparities:

You should be proactive in negotiating your salaries and seeking promotions. Research industry standards for your roles and advocate for fair compensation.
Seek out networking and mentorship opportunities to help you gain access to valuable career guidance and support.

Balancing Work and Caregiving:

If you take time off to care for children or aging parents explore flexible work arrangements or freelancing to maintain income.
Consider long-term care insurance or savings to address potential caregiving responsibilities in the future.

Student Loans:

Research and apply for scholarships, grants, and fellowships to reduce the financial burden of graduate school.
Consider income-driven repayment plans and explore loan forgiveness programs for certain professions or public service work.

Investing:

Educate yourself with financial education to help you understand the basics of investing. Start with low-risk investments and gradually build confidence.
Remember the importance of diversification in your investment portfolio to manage risk.

Seek Professional Guidance:

Work with financial advisors or professionals who specialize in helping women navigate their unique financial challenges. These experts can provide you with tailored advice and strategies.
Do regular meetings with a financial advisor to review financial goals, investment strategies, and retirement planning.

Build a Support Network:

Connect with other professional women through peer groups or organizations that focus on financial literacy and empowerment.
Research success stories and role models of women who have achieved financial independence and stability.

Long-Term Planning:

Remember the importance of long-term financial planning, including retirement savings. You should start early and consistently contribute to retirement accounts.
Consider creating a financial roadmap with clear milestones and goals to track your progress over time.

Remember that each woman's financial situation is unique, and personalized guidance is essential. We hope some of the strategies above will empower you to take control of your financial future.

Estate Planning

laura@rightdirectionfinancial.ca (Laura Chanin) — Tue, 14 Nov 2023 23:13:24 GMT

Our estate planning checklist is a helpful guide for individuals looking to prepare their estate, including drafting or updating their will.

Here's a breakdown of the key steps in the checklist:

List your assets and liabilities:

Include all your real estate, personal items, bank accounts, digital assets, mortgages, loans, and credit cards. This is a crucial step to understand the extent of your estate.

List your beneficiaries:

Create a comprehensive list of beneficiaries, considering dependents, family members, friends, and charitable organizations. Decide how you want to distribute your estate among them.

Consult with a tax professional or financial advisor:

While not mandatory, consulting a tax professional or financial advisor can help you understand the tax implications of your estate planning decisions. Donations to charitable organizations, for example, can reduce the estate's tax liability.

Speak to and determine guardians:

If you have minor children, discuss and choose guardians for them. Ensure that the selected individuals are willing to take on this responsibility and support your plans.

Select and speak to your executors:

Choose an executor for your will, and have a candid conversation with them. Consider having a backup executor in case the primary choice is unavailable. Provide the executor with information about your assets and key contacts.

Select a Power of Attorney:

Designate individuals for both property and personal care powers of attorney. It's essential that they understand your intentions and responsibilities associated with these roles.

Think about what you want to be distributed outside your will:

Some assets, like RRSPs, TFSA, RRIFs, life insurance, or jointly owned assets, can bypass your will and go directly to the beneficiary. Consider how these assets should be distributed.

Seek out a professional:

With the checklist completed, it's time to consult with a legal professional, such as a lawyer or notary. They can help you draft or update your will. Alternatively, if your will is simple and you're tech-savvy, you can explore online will-writing services.

Remember that estate planning is a crucial process, and it's advisable to review your will periodically, especially after significant life events or changes in your financial situation to ensure it remains up to date and reflective of your wishes. Consulting with a legal professional can provide you with tailored advice and ensure your estate plan is legally sound.

Source: www.canada.ca

The Best Medicine for Winter Blues

Mon, 16 Oct 2023 19:30:38 GMT

October 2023

If you’re of the many who struggle with the grey winters, read on!

When the sun is shining, and the weather is warm, it’s easy to get outside and enjoy the fresh air. We tend to move our bodies more without even thinking about it in the warmer weather. Our vitamin D levels skyrocket, our immune systems thrive and prioritizing our health becomes effortless.

And then comes October…

So, since the grey skies and rain are en route, let’s discuss the simplest of tricks to keep our mental states coasting until spring.

To no surpris e, exercise i s at the top of the list. (What doesn’t exercise solve?!)

When we exercise, we release endorphins. These chemical hormones in your body help reduce pain, reduce stress, and improve your sense of well-being.

When these "happy hormones" are released into your bloodstream, they also help reduce anxiety.

Exercise also helps reduce fatigue and tiredness by getting your body moving and muscles activated. With all the extra inside time, it’s too easy to let the regular worries of life monopolize your thoughts, but physical activity can be such a beautiful and useful tool to help take your mind off your worries for a little while.

Setting aside as little as 20-30 minutes a day to engage in physical activity can have so many beneficial impacts on your life, especially through the winter!

Regular exercise is truly one of the simplest and healthiest ways of improving psychological and emotional benefits. In addition to help fighting the winter blues, exercise can also be used to:
Boost confidence. Regular exercise can aid in improving your self-esteem. This is because you will begin to feel strong and powerful by increasing exercise habits into your daily routine. Additionally, exercise helps your confidence with respect to your appearance and feeling a sense of achievement.
Help relax the muscles & relieves tension . Exercise is a powerful tool to ease up anxiety and tension in the body. Using exercise to calm your stressors will help boost your mood and energy.
Sleep better . Studies show that even small bursts of exercise incorporated in the day can help regulate sleep patterns. Better quality of sleep links to better moods, increased energy, and helps promote healthier physical activity levels throughout the day.
Boost energy levels & focus. As mentioned previously, exercise naturally helps boost energy levels. This is due to the cellular-level changes that occur in the body when you exercise. Scientifically speaking, exercise initiates the body to produce more mitochondria inside the muscle cells. These "powerhouses" create fuel out of glucose and thus increase your body's energy supply. Additionally, exercise increases hormone levels, making you feel more energized.

If regular exercise isn’t a habit for you right now, the best way to start is to set a small goal.

Here are a few tips to get you started.

1. Schedule workouts when energy is at its peak. Regardless of where you are in your fitness journey, you simply will be less motivated to go to the gym when your energy is at its lowest. Aim for when your energy is at its highest throughout the day to get some movement in.

2. Don't overcomplicate workouts. Just a simple 15-minute walk can help you clear your mind and boost your energy levels!

Choose activities you enjoy. There are countless ways to exercise. It’s important to choose a form of exercise that you genuinely enjoy. Maybe it’s walking the dog a mile or two, joining a friend for yoga, or even gardening or raking leaves.

Any activity that gets you moving counts!

Sources:

Depression and anxiety: Exercise eases symptoms. (2017, September 27). Retrieved from https://www.mayoclinic.org/diseases-conditions/depression/in-depth/depression-and-exercise/art-20046495#:~:text=Regular exercise may help ease, your sense of well-being

How Can Exercise Affect Sleep? (2022, May 06). Retrieved from https://www.sleepfoundation.org/physical-activity/exercise-and-sleep

The Mental Health Benefits of Exercise. (n.d.). Retrieved from https://www.helpguide.org/articles/healthy-living/the-mental-health-benefits-of-exercise.htm

October Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Mon, 16 Oct 2023 19:30:36 GMT

September is typically the worst month for markets and this year was no exception.

Global equity markets were down almost across the board in September.

The S&P/TSX Composite was down 3.3% and the S&P 500 was down 4.8%, in Canadian dollars.

Yet, despite the recent weakness, they remain positive year to date, with YTD gains of 0.4% and 13.2%, although as mentioned in earlier editions the US market gains are heavily weighted towards the large technology companies because of excitement around artificial intelligence.

Recent market volatility has been mostly a result of stickier inflation data and the U.S. Federal Reserve’s commitment to higher-for-longer interest rates. The equity markets had expected central banks to already be discussing rate cuts, but that has been pushed down the road for now. They are still committed to getting inflation back towards the 2% level.

The news right now is pretty negative, starting with the Israel attacks and the debacle of the US House of representatives with their speaker so it can be easy to get discouraged.

However, we believe we’re getting close to peak interest rate levels given that we also believe the Fed is nearing an end to their tightening cycle.

Manulife Investments looked at the last six Fed tightening cycles, going back to the early 1980s. In four out of those six instances, the 10-year peaked roughly three months before the last Fed hike.

In one instance, they peaked almost simultaneous, while in another, the 10-year peaked roughly one month after the last Fed hike. Recent history suggests that the 10-year typically peaks within a few months of the last Fed hike.

Of course, nothing is perfect, and we’ve seen short-term spikes in the U.S. Treasury due to shocks. Once there is more certainty with inflation and interest rates as well as whether there will be a recession or not, there can be more clarity with investments. In the meantime there may continue to be volatility.

What can you do? It really depends on your goals, your time frame and your comfort with risk.

If you need money in a short time frame, then choosing a liquid, secure investment is the right choice. And interest rates are very attractive right now.

If you have a longer time frame, then continue to pick high quality companies. Businesses that have strong management teams, manage their debt well and continue to grow and prosper should lead to strong future investments.

Fixed income investments have been poor for a long time, but that may be changing. With increasing interest rates, yields on fixed income bonds are much higher than they have been in years. Once interest rates start to decline, bond prices will go up so they are expected to be good investments. They are also meant to be a diversifier if stocks go down.

Alternative investments like private mortgages, infrastructure, commodities, real estate are also good to consider for further diversification.

If you have any questions, please let me know.

Source: www.bloomberg.ca

How Much do I Need to Retire?

leslie@rightdirectionfinancial.ca (Leslie Sommer) — Mon, 16 Oct 2023 19:30:35 GMT

The amount of money you need to retire in Canada can vary widely depending on your individual circumstances, lifestyle, and financial goals.

There are several factors to consider when determining your retirement savings goal, including:

Current Age : The age at which you plan to retire can significantly impact how much you need. If you plan to retire early, you'll need more savings to cover a longer retirement period.
Expected Retirement Age: The later you retire, the less you may need because you'll have fewer years of retirement to fund.
Cost of Living : The cost of living can vary greatly depending on where you live in Canada. Major cities like Toronto and Vancouver tend to have higher living costs than smaller towns and rural areas.
Housing : Whether you own your home, have a mortgage, or plan to rent in retirement will affect your expenses.
Debts : The amount of debt you carry into retirement, such as mortgages, loans, and credit card debt, will influence your retirement needs.
Healthcare : While Canada has a publicly funded healthcare system, there may still be out-of-pocket expenses for medical and long-term care which can cost upwards of $10,000 a month if you go live in a private facility
Lifestyle : Your desired retirement lifestyle plays a significant role. Do you plan to travel frequently, dine out often, or have other costly hobbies and activities?
Inflation : Over time, the cost of living tends to increase due to inflation, so you'll need to account for this when calculating your retirement needs.
Government Benefits: Canada offers government benefits such as the Canada Pension Plan (CPP) and Old Age Security (OAS), which can help supplement your retirement income. Note: Most people do not qualify for the maximum amount of CPP.

To estimate your retirement savings goal, you can use online retirement calculators, or and consider the 70% to 80% rule. This rule suggests that you aim to replace 70% to 80% of your pre-retirement income in retirement. So, if you were earning $50,000 per year before retiring, you'd aim for an annual retirement income of $35,000 to $40,000.

Keep in mind that these are general guidelines, and your specific circumstances may require more or less savings. It's essential to have a personalized retirement plan and consider factors like investment returns, potential inheritances, and unexpected expenses in your calculations.

Source: https://www.canada.ca/en/financial-consumer-agency/services/retirement-planning/start-saving-retirement.html

Stop and Smell the Pumpkin!

Mon, 18 Sep 2023 17:10:08 GMT

The Desire for Satiation

When I think fall, I think of cinnamon and pumpkin spice. So many of my favourite foods and drinks come to mind with this season. And simply imagining my favourite fall scents makes me hungry. Close your eyes and imagine inhaling your favourite fall treat. Is it a gingerbread cookie, a warm pumpkin spice latte? Take a pause and really imagine it in front of you...hungry yet?

What you’ve just experienced is the desire for satiation. Feeling satiated is one of the most important factors in eating. We all love to feel full, satisfied and most importantly, satiated. It brings us happiness and adds to our quality of life. But what many of us don’t consider, is the role smell plays in that feeling of satiation and satisfaction.

So many of our senses are involved in taking just one bite of food. We see our favourite foods, our brain imagines the taste, the feeling. It signals our stomach to prepare for that first bite. We breathe in that smell, now our juices are really flowing! As you chew that bite, you’re still using your sense of smell to enjoy it to its fullest. Delicious. Satisfying. Close your eyes. Enjoy that bite. Enjoy that feeling.

We all crave that feeling of satiation. We seek it multiple times a day. But what we don’t give enough credit to, is how the simple act of smell adds to that feeling. It‘s not our stomach that signals us when to stop eating. It’s our brain. Our brain is craving that feeling of satiation and satisfaction. The act of smell and taste combined send a signal to your brain telling it when it feels satiated- aka: when to stop eating. (It’s only later that your stomach realizes that it’s full).

I encourage you all to mindfully watch for that feeling of satiation. It’s not happening in your stomach, it’s happening in your brain. Find a time to enjoy your favourite fall meal and make a conscious effort to slow down. Smell it before you eat it. Smell it as you eat it. Enjoy that smell. Enjoy that taste. Enjoy that sensation of satiation.

Once you build this simple habit, you may notice your portion sizes decrease and your feeling of satiation and fullness increase.

Source: https://www.shapedfitness.ca/post/stop-and-smell-the-pumpkin

RESPs 2023

leslie@rightdirectionfinancial.ca (Leslie Sommer) — Mon, 18 Sep 2023 17:10:06 GMT

Here Are Some Key Points About RESPs in Canada:

Purpose: RESPs are designed to help Canadians save for a child's post-secondary education, such as college, university, or trade school.
Contributions: Anyone can contribute to an RESP, including parents, grandparents, relatives, and friends. There is a lifetime contribution limit for each beneficiary, and there is no annual contribution limit. However, to maximize government grants, it's recommended to contribute up to $2,500 per year per beneficiary.
Government Grants: The Government of Canada offers grants to encourage RESP savings, such as the Canada Education Savings Grant (CESG) and the Canada Learning Bond (CLB). The amount of these grants depends on various factors, including your income and contributions.
Tax Benefits: Contributions to an RESP are not tax-deductible, but they grow tax-deferred. When the beneficiary withdraws funds for educational purposes, they are taxed in the beneficiary's name, typically at a lower tax rate.
Withdrawals: When the beneficiary enrolls in a qualifying post-secondary education program, they can start withdrawing funds from the RESP. These withdrawals come in two categories, first, withdrawing contributions (called a PSE), and second, including grants and the investment earnings (together called an EAP). The withdrawal of grant and earnings are taxable, but because students usually have a lower income, they may pay little to no tax. In 2023 the government announced an increase from $5,000 to $8,000 on the limit of an EAP during the first 13 weeks of study for full‑time studies (qualifying educational program), and an increase from $2,500 to $4,000 on the limit of an EAP for every 13‑week period of study for part‑time studies (specified educational program).
Lifetime Limit: The lifetime contribution limit per beneficiary is $50,000, and the maximum CESG grant available is $7,200.
Plan Types: RESPs can be set up as individual plans for one beneficiary or family plans that can have multiple beneficiaries, typically siblings. This allows for flexibility in managing RESP investments among family members.
Subscribers: Former spouses and common-law partners who are still the legal parents of a child may now open an RESP as joint subscribers.

Source: https://www.canada.ca/en/services/benefits/education/education-savings.html

September Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Mon, 18 Sep 2023 17:10:05 GMT

Here is an update from JP Morgan. It’s focused on the US, which impacts Canada.

The US economy continues to show strength, albeit starting to slow a bit, it's important to recognize that the risk of a recession still lingers.

Therefore, the best approach going forward is to be cautious and patient.

The term "resilient" is often used to describe the U.S. economy in 2023, largely due to strong consumer activity. In the second quarter, household spending drove over half of the economic growth and is expected to do the same in the third quarter. Low unemployment rate and rising wages have supported consumers, but it's possible that the situation may be less secure than consumption data suggests.

By JP Morgan’s measurements, the excess savings accumulated during the pandemic have dropped from $2.1 trillion to just $0.2 trillion. This has led consumers to rely on credit to sustain their spending. While the ratio of credit to disposable income doesn't appear overly concerning at the moment (6.3% in June compared to 6.5% before the pandemic), there are signs of trouble.

Delinquencies for credit cards and auto loans are on the rise. Early delinquencies for credit cards in the second quarter reached their highest level in a decade, and serious delinquencies (over 90 days overdue) are also increasing.

This suggests that the effects of increasing interest rates may be starting to impact consumer spending. Additionally, with student loan payments resuming at the end of the month, the exuberance of summer shopping may be followed by a more frugal back-to-school season.

In Canada, there has been a noticeable impact on the cost of mortgages and how we are spending here.

Consumer confidence notably declined in August, dropping almost 8 points to a reading of 106.1, partially reversing gains seen in June and July. Investors seem to be taking a similarly cautious approach, likely due to doubts about a smooth economic transition and concerns about rising energy prices. Consequently, stock prices fell last week.

So continue to proceed with caution and patience.

Here are the latest YTD market numbers as of September 26, 2023:

Sources: https://www.marketwatch.com/inves ting

https://www.jpmorgan.com/CA

August Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 09 Aug 2023 22:42:13 GMT

August 2023

The markets, in particular, the US have had a very good 2023.

At the end of August 18, the S&P 500 Index was up 14% year-to-date, driven higher mostly by the optimism surrounding the impact of artificial intelligence. However, if you take out the top 10 companies in the index, the S&P 500 return falls to roughly 5% year to date.

As a result, the top 10 companies in the S&P 500 now account for 30% of the index. This is the first time in modern history that the top 10 holdings account for 30% of the entire S&P 500.

While this stat in itself isn’t surprising. (There are many reasons that may justify the current high values including that we are likely getting close to peak interest rates and these companies have had better-than-expected quarterly earnings). We should be thoughtful of the risks.

Here is a chart showing the % companies and their % weight in the S&P500 over the past several decades

Historical Top 10 Holdings for the S&P 500 (% Index Weight )

Source: Bloomberg, as of July 31, 2023.

Some questions to consider:

What is my exposure to these top 10 companies?
What’s my current exposure today when looking at all my investments?
Am I comfortable with this amount of exposure purely from a risk management perspective?

How each person reacts to the finding of these results will vary, as will their decision on how to react. It’s a good time to review portfolio positioning and make sure that there aren’t any unintended risks, given the concentration in returns this year.

Here are the overall results year to date:

If you have any questions, feel free to reach out.

Source: www.marketwatch.com

Income Splitting with a Lower Income Spouse

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 09 Aug 2023 22:42:12 GMT

If you have a couple in which one spouse has a large income and other has little to none, there are opportunities to income split.

Let’s look at Sarah who makes $200K and John who makes $40K per year:

1. Contributing to an RRSP:

Sarah can give John some of her income to contribute to an RRSP for John and it can save John a bit of money in taxes. You need to be sure that John has some RRSP room.

2. Contributing to a Spousal RRSP:

With a spousal RRSP Sarah has the option of contributing to a spousal RRSP for John. That means she gets the tax deduction now and in the future when the money is withdrawn, it comes out in John’s name.

Does it make sense because in retirement you can income split up to 50% of your RRIF withdrawals, as long as you are over 65?

Yes, it does because you may start withdrawals before 65 and it gives you more flexibility with income splitting.

Remember that it you do a withdrawal from the spousal RRSP in the current or following two years, there may be tax implications for the higher income earning spouse. There is an exemption if the spousal RRSP is converted into a RRIF and they are only taking the minimum withdrawal.

3. Contributing to a TFSA:

Sarah can contribute to John’s TFSA without any tax implications. TFSA contribution room accumulates regardless of employment or not. TIP: Both should max out their TFSA accounts before they invest in nonregistered accounts.

4. Contributing to a non registered account using a spousal loan:

There may be tax issues if the Sarah invests in a non registered account in John’s name. The investment income generated would be 'allocated' back to Sarah and taxed in her name.

One option is for Sarah to lend money to John at the rate prescribed by the CRA (currently 5%). John could invest the money and pay Sarah an interest payment and then deduct the interest payment as a carrying charge to reduce his investment income.

And Sarah would add the interest payment to her income.

In order to make this strategy worthwhile, the rate of return on the investments should be higher than the cost of the interest rate prescribed by CRA.

Let us know if you have any questions.

Sources: https://www.canada.ca/en.html

https://www.moneysense.ca/columns/ask-a-planner/income-splitting-with-a-lower-income-spouse/

Wed, 09 Aug 2023 22:42:10 GMT

As a Nutrition and Fitness Coach, I am no stranger to physical health assessments.

When we think of good health, it’s often associated with body composition or weight, cholesterol levels, blood pressure or fitness levels. When health is discussed in social settings, the topics range from heartburn and migraines to personal bests on marathons.

What does this all have in common?

We tend to associate health dominantly with physical health. Yes, physical health is vital and undeniably important. It’s how most of us have been taught to think about health since we were old enough to understand. But what’s often overlooked is that physical health is only one component of deep health.

Deep health encompasses so much more!

Deep health is a state of thriving in all areas of your life, not just the physical. I like to refer to these areas as “dimensions” of deep health. The six dimensions of deep health are: physical, emotional, mental, social, environmental, and existential. Once each of these dimensions are understood, it’s easy to see that by focusing only on physical health, you’re assessing your health through a very narrow lens and missing many valuable insights.

6 Dimensions of Deep Health :

1. Physical : Feeling energetic: your body performs and functions well

2. Social : Having a sense of connection and belonging to the people in your life

3. Emotional : Being able to tune into, process and express your feelings and emotions

4. Mental : Being able to think clearly, focus and remember important things

5. Environmental : Living amidst surroundings that feel safe and important

6. Existential : Having an underlying sense of gratitude, purpose, and joy

Truly understanding deep health holistically can also help you determine what actions will make the most positive impacts on your life. On the pursuit of health, we know that habits are key. But if our motivation is physical health, changing a habit for good can be challenging if we don’t see or feel the physical changes right away.

Or possibly we’re not motivated by physical health. What if we understood how changing a habit could affect our deep health on multiple levels? Might we be more likely to sustain it? Because interestingly, without us even knowing it, our ability to eat, move and sleep in a way that’s sustainable, depends on the other five dimensions of deep health.

Let’s use the example of persistent trouble sleeping. We know that poor sleep effects physical health, but let’s consider how it effects your emotional, environmental, mental, social, and existential health.

Persistent Trouble Sleeping Effects :

Physical : Fatigue and lethargy
Social : Snapping at partner
Emotional : More sensitive to criticism
Mental : Distracted and unfocused
Environmental : Messy and disorganized house
Existential : Less energy for meaningful and fun activities

Now let’s look at how the effects of poor sleep feed the issue of persistent trouble sleeping:

Physical : Fatigue and lethargy ~ Irregular meals ~ Persistent trouble sleeping
Social : Snapping at partner ~ Tension with partner ~ Persistent trouble sleeping
Emotional : More sensitive to criticism ~ Heightened work anxiety ~ Persistent trouble sleeping
Mental : Distracted and unfocused ~ Shutting work laptop down 2 minutes before bed ~ Persistent trouble sleeping
Environmental : Messy and disorganized house ~ Cluttered bedroom stressing you out ~ Persistent trouble sleeping
Existential : Less energy for meaningful and fun activities ~ Lying awake wondering if this is all life is ~ Persistent trouble sleeping

To go even deeper, each one of those effects begin to feed each other: A messy house can contribute to snapping at your partner. Irregular meals contribute to less energy. Heightened work anxiety leads to shutting your work laptop down 2 minutes before bed.

Each of our dimensions of health are becoming negatively intertwined. And all this time we thought poor sleep was simply affecting our physical health. Understanding the way various aspects of life work together to create your complex human experience is where the real insights begin.

Now that we see how various aspects of health are affected by ONE issue (poor sleep), let’s use the same example to see how various aspects of health can be affected by ONE solution- an evening wind down ritual.

Evening Wind Down Ritual Effects :

Physical : More energetic and active ~ Meal planning and more home cooked meals ~ Evening wind down ritual
Social : More patient with partner ~ Partner does evening ritual too meals ~ Evening wind down ritual
Emotional : Calmer and less reactive ~ Feel less identified with work meals ~ Evening wind down ritual
Mental : More engaged and productive during work hours ~ Boundaries around working hours reduced stress meals ~ Evening wind down ritual
Environmental : Don’t associate home with work as much ~ Tidier house feels relaxing meals ~ Evening wind down ritual
Existential : Inspired to contribute in a bigger way ~ Clearer sense of purpose helps prioritize between work and life meals ~ Evening wind down ritual

Notice the relationship between these elements.

For this hypothetical well-rested person, better sleep is causing better focus and productivity during standard work hours. This frees up time outside of work, which helps them build up other aspects of their identity and feel less defined by work. Meal planning and more regular healthy, home-cooked meals are also helping daytime mood balance. The energy they’ve gained from sleeping better is also helping them think in a bigger way about your life, and how they’d like to contribute to the world or their community in a meaningful way.

All the dimensions work together, building positive momentum and providing scaffolding for even more improvements.

Our health isn’t dependent on one single aspect, such as physical health. So, improving our health shouldn’t be confined to working on one dimension. Health is supported by a network of intersecting, interdependent factors.

And when that network is strong and working together, it creates a state of health that is richer, deeper, and more resilient than anything you’ve ever experienced.

Source: https://www.precisionnutrition.com/deep-health-guide

Disclaimer: iA Private Wealth Inc is a member of the Canadian Investment Industry Regulatory Organization of Canada. iA Private Wealth is a trademark and business name under which iA Private Wealth Inc. operates. This information has been prepared by Kelsey Maxwell who is a Business Development Manager for iA Private Wealth Inc. Opinions expressed in this post are those of the Business Development Manager only and do not necessarily reflect those of iA Private Wealth Inc.

Tax Credits for Seniors

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 13 Jul 2023 19:11:02 GMT

Here are some tax credits for (mostly) seniors in Canada.

Age Amount : Canadian seniors over 65 with income below $39,826 can claim a non-refundable tax credit of $7,898 for the 2022 tax year. The credit can be transferred to a spouse or common-law partner if not needed.

Pension Income Amount : Seniors who received pension income reported on specific lines of their tax return can claim a tax credit of $2,000. Eligible types of pension income include private pensions, superannuation payments, RRSP income, and income splitting with a spouse.

Pension Income Splitting : Seniors who reported income on line 11500 of their tax return may be able to split that income with their spouse or common-law partner by completing Form T1032, Joint Election to Split Pension Income.

Home Accessibility Tax Credit (HATC) : Seniors can claim a non-refundable tax credit of 15% for up to $10,000 in expenses incurred for making their home more accessible. Examples of eligible improvements include stair lifts and wheelchair ramps.

Medical Expense Tax Credit : Seniors, along with Canadians of all ages, can claim eligible medical expenses that exceed the minimum threshold (3% of net income or $2,479 for the 2022 tax year). Eligible expenses can include cancer treatment, medical equipment, and travel expenses for medical treatment.

Disability Tax Credit : Designed for individuals with disabilities and their caregivers, the non-refundable Disability Tax Credit provides a tax credit of $8,870 for the 2022 tax year.

Federal Political Contribution Tax Credit: Taxpayers who made donations to a federal political party can claim a tax credit if they owe tax for the year. The credit cannot be carried forward but can be claimed by a spouse if unused.

Charitable Donations : Seniors can claim tax credits for donations made to registered charities in Canada. The credit is 15% on the first $200 donated and 29% on amounts over $200.

Climate Action Incentive (CAI) : Residents of Alberta, Saskatchewan, Manitoba, and Ontario can claim the CAI, a tax credit designed to offset carbon tax fuel charges that increase gas costs. Each household can claim one credit.

Canada Caregiver Credit : Seniors providing support to dependents with physical or mental disabilities may be eligible for the non-refundable Canada Caregiver Credit.

Source: www.canada.ca

Finanical Planning for Aging Parents

leslie@rightdirectionfinancial.ca (Leslie Sommer) — Tue, 11 Jul 2023 20:12:24 GMT

Financial planning for aging parents is an important aspect of caregiving.

Here are some key considerations:

Understand their financial situation : Start by having open and honest conversations with your aging parents about their financial situation. This includes understanding their income, assets, debts, expenses, and any existing financial plans or arrangements they have in place.

Create a budget : Help your parents establish a budget that reflects their current and anticipated expenses. This will provide a clear picture of their financial needs and help identify any potential gaps or areas where adjustments can be made.

Assess healthcare costs : Healthcare expenses tend to increase with age. Review your parents' health insurance coverage, including supplemental plans, and ensure they have appropriate coverage for their needs. Consider the potential costs of long-term care, such as nursing homes or home care, and explore options for long-term care insurance if applicable.

Review legal and estate planning : Encourage your parents to create or update important legal documents, such as wills, trusts, powers of attorney, and rep agreement. Consult with an estate lawyer to ensure their wishes are properly documented and their assets are protected.

Consolidate and organize financial accounts : Help your parents consolidate their financial accounts if they have multiple scattered across different institutions. Simplifying their accounts can make it easier to manage and track their finances.

Identify and maximize income sources : Explore all potential sources of income for your parents, including CPP, OAS, pensions, retirement accounts, and investments. Optimize their income by understanding the best timing for claiming CPP benefits and maximizing returns on their investments.

Explore government assistance programs : Research government assistance programs that your parents may be eligible for, such as Fair Pharmacare, Veterans Affairs benefits, or other local programs. These programs can help alleviate financial burdens associated with healthcare and long-term care.

Consider long-term care insurance : Depending on your parents' circumstances and preferences, long-term care insurance can provide financial protection against the high costs of extended care. Evaluate the options available and assess whether it makes sense for their situation.

Plan for your own financial well-being : Caring for aging parents can have financial implications for you as well. Take the time to review and adjust your own financial plans, including budgeting for additional caregiving expenses or considering the impact on your retirement savings.

It's important to note that financial planning for aging parents can be complex, and it's advisable to seek guidance from a financial planner or estate lawyer who can provide personalized advice based on your parents' specific circumstances.

Sources: https://www.scotiabank.com/ca/en/personal/advice-plus/features/posts.what-you-need-to-plan-for-when-caring-for-aging-parents.html

https://www2.gov.bc.ca/gov/content/family-social-supports/seniors/caring-for-seniors

Stock Market Update July 2023

laura@rightdirectionfinancial.ca (Laura Chanin) — Tue, 11 Jul 2023 20:10:49 GMT

Postponing the Recession?

Here are some comments from Macan Nia, Co Chief Investment Strategist at Manulife Investments:

The recession has been postponed but it’s not time to pop the bubbly! Soft landing, hard landing, or no landing? These scenarios are front and center in the financial media, and many aren’t even sure what they mean! In essence, the question is what type of slowdown will we experience in the U.S. and Canada? We believe that the recession has been postponed but not canceled.

Many investors point to the strong employment market in the U.S. as a positive signal that a recession has been avoided. However, we argue that the unemployment rate is a lagging rather than leading indicator. This seems to be more true now in a post-COVID environment, as employers in some industries continue to find it difficult to fill outstanding positions, leading to a practice called job hoarding, a practice where they may be more hesitant to cut staff during a tough environment, choosing instead to cut hours worked.

A study by Insight Global revealed that nearly 90% of small businesses plan to continue job hoarding in 2023.

While there’s no mathematical equation as to how many indicators need to be yellow or red before we become confident that a recession is knocking on the door, the leading indicator column clearly shows that the balance of risk skews to the downside when it comes to the U.S. economy.

The recession has likely been postponed, not cancelled, and as we enter the next stage of the economic cycle in the coming quarters, asset allocation focused on quality in equities and bonds will be crucial.

Inflationary pressures likely remain sticky through 2023 but should continue to show signs of unwinding. The unwinding of base effects from early 2022 should lead to a slower disinflation in goods starting in the middle of 2023, which is already evident in energy; food is showing promising disinflationary signs, as well. Services inflation excluding shelter, which is an indirect proxy for wage pressure and medium-term inflation, will be slower to moderate and remains a critical determinant of monetary policy stances.

The opportunity in bonds has been one of the most prominent messages in financial circles to begin this year. While there’s no denying this, we believe it’s more important to invest in the right bonds. The elevated levels of volatility in the Treasury curve shows how important it is to be flexible and active when managing fixed income. It’s not as simple as choosing short or long duration.

The opportunity in stocks is still positive for longer term but there’s uncertainty near term. U.S. equities have rallied strongly to start the year, but it has been predominantly on the back of the euphoria surrounding artificial intelligence (AI).

New bull markets are rarely built on rallies with this little breadth. The top 10 companies by market capitalization are responsible for nearly 73% of the S&P 500 Index’s 17.1% return this year. An uncertain macroeconomic landscape is a potential headwind for equities (source: Bloomberg, Capital Markets Strategy, July 2023)

The question often comes up as to where a portfolio should be overweight or underweight from a geographic perspective. From a fundamentals perspective, meaning earnings and valuation, there doesn’t seem to be an obvious choice. Given we expect to see an increased risk of a global economic slowdown, we’d expect this to impact potential earnings growth .

Valuations also don’t indicate a clear-cut winner. When looking at valuation, on a trailing price/earnings ratio basis across various global indices relative to their individual longer-term history, many appeared fairly valued . Even though the S&P 500 appears slightly overvalued, much of that can be attributed to the recent rally of the top weights in the index. In environments such as these, it’s often best to look at individual security selection rather than specific geographies or sectors.

Further, a well-diversified portfolio could help smooth out the ride should we experience choppy waters over the near term.

If you have any questions I’m here to talk.

Laura

Source: www.manulifeinvestments.ca

Health and Wellness: Sleep and its Effects on the Brain

Tue, 11 Jul 2023 20:08:01 GMT

As we’re enjoying long summer nights and early morning sunrises, it can be easy to miss out on our 8 hours. And while it’s important to soak up every moment of this beautiful season, it’s a good time to remind ourselves of the effects sleep has on the brain.

The role sleep plays in recovery cannot be overstated. Without good quality sleep, the brain and the body both cease to operate at their optimum level. Dr Abhinav Singh, a Medical Director of the Indiana Sleep Center and a member of the Medical Review Panel of SleepFoundation.org weighs in; "Sleep is essential for the brain to maintain several of its functions," he said. "During sleep, the brain does several housekeeping things for itself and the body during sleep; muscle repair, immune system modulation and memory are all being processed during sleep.

Sleep is governed by a small, almond-sized part of the brain called the hypothalamus. As well as regulating your body temperature, managing emotional responses and controlling appetite, it’s also responsible for releasing hormones and setting your internal body clock. However, to work efficiently it needs the right light signals to be sent to it at the right times. If your sleep is disturbed or irregular, it simply won’t function as it should, leaving you in a spiral of tiredness during the day and sleeplessness at night. "We now know that a ‘deep pressure wash’ takes place during deep sleep in the first half of the night whereby the toxic protein beta-amyloid is removed actively during sleep.

Poor sleep may lead to an accumulation of this metabolic waste, which can affect memory, learning, and emotional regulation."

One study, published in Nature in 2017, found that lack of sleep had the same effect on the brain as drinking too much alcohol, slowing down response times and making you feel sluggish. Another common issue associated with lack of sleep is the increase it provokes in the stress hormone cortisol. As it rises, cortisol suppresses melatonin, preventing adequate sleep and leading to mood swings, anxiety and possibly behavioral issues.

So how can we properly prioritize sleep? It’s all about mastering your sleep hygiene. Put simply, that’s all the things you need to put in place before bed in order to maximize your chances of sleeping soundly, ranging from putting your phone down well before bed to learning which is the best sleeping position. You’ll be amazed at how changing just a few habits can make a real difference to the quality of your sleep.

Try establishing a sleep schedule where you wake up at the same time every day, seven days a week. Block out any unwanted noise and go for cool, breathable fabrics on your bed and nightclothes too. Avoid drinking alcohol in the evening and make sure your room is as dark as it can be too so the photoreceptors in your eyes can send a message to your brain that it’s time to sleep.

It’s important that the bedroom is cool as well. According to research published in the medical journal Sleep, warm rooms can reduce the amount of time that your body spends in REM sleep.

Finally, don’t be tempted to use your cell phone or a tablet while in bed, as the blue light they emit acts to stifle melatonin. "Give yourself a wind-down ritual that's free of any unnecessary stimulation," added Dr Singh. "And remember, the most important aspects of sleep hygiene are routine, rhythm and repetition.

Source: https://www.livescience.com/how-sleep-affects-the-brain

Financial Planning for Women at the Different Stages of Life

laura@rightdirectionfinancial.ca (Laura Chanin) — Thu, 15 Jun 2023 19:07:00 GMT

Financial planning for women is important no matter of where you are in life and your financial situation. Whether you are single, married, changing careers, starting a family, getting divorced, or caring for elderly parents, there are key financial steps you should be taking to ensure you meet your financial goals.

When it comes to financial planning for women, it can get overwhelming. However, with these financial steps, you can create a plan to ensure you are financially prepared for whatever life stage you are at!

Financial planning for women if you are employed

Whether you are the female breadwinner or working part-time, these are key steps to include in your plan .

Take advantage of your employer’s RRSP matching plan
If your employer offers a retirement savings plan with a match, you should be taking advantage of it.
You can do this by contributing enough to at least get the full match your employer is offering. It's essentially free money.
If your employer's plan does not have a match, contribute anyway with a goal to eventually max out your contributions.
No employer-sponsored retirement plan or self-employed?
Set up your own RRSP or TFSA through a brokerage and make your retirement contributions that way. The limits are lower, but it's a great start to your long-term retirement savings.
Also, you can start looking into non-retirement investing and repurpose them as investments towards your retirement. One of the most important steps of financial planning for women is saving for retirement.
Bulk up your emergency fund .
It's important to set up your emergency fund. This is one of the most important things to do when it comes to financial planning for women. Your first goal should be getting one month’s rent or mortgage payment saved. Then work towards saving 3 - 6 months of your basic living expenses.
This would be to cover things like food, transportation, and housing. This way, you can ensure you don't have to use debt in the event of an unexpected situation. Major expenses such as fixing your car, home repairs, or losing your job can wreak havoc on your finances if you don't prepare for them!
Pay yourself first.
Another important part of financial planning for women is to learn to pay yourself first! It is a great way to save and it's so easy to let money slip through our fingers. Set up automatic transfers to your savings accounts to ensure you are paying yourself before spending money. Even setting up a transfer of $25 a week adds up to $1,300 in just a year! You can also contact your employer or bank to see if you can have your paycheck automatically split into different accounts.
Pay off high-interest debt.
Start paying off any debt you might have especially high-interest credit card debt. If you have high-interest debt, get your emergency fund to $1,000 and then focus on getting rid of that debt asap. High-interest debt is costly, and the longer you keep it, the more you pay.
Get properly insured .
Review your insurance options to make sure you have the right ones in place. Different types of insurance policies will include disability, life, health, auto, home, tenant, etc.
Also, keep your beneficiaries up to date on all your accounts.
Plan for your children.
If you have children, you can start saving for their university education needs with a RESP and take advantage of government grants. Start building their shorter-term needs into your budgeting and savings plans as well.

Financial planning for women to take if you are in a serious relationship or marriage

Getting married and joining your finances together means working as a team. Here are some steps you can take to plan your finances as a couple.

Talk about finances as a couple
It's important that you are communicating your life and financial goals with your partner.
Learning to tackle your finances as a team is an essential part of financial planning for women. Talk about what you'd like to accomplish together.
Set time aside once a month to go over your progress.
Review your budget as a couple, including your debt repayment, savings, and investment plans.
Update your beneficiaries on your accounts and insurance .
Remember to include your significant others, i.e., your spouse and children.

Financial planning for women to take when switching jobs

Have you recently changed jobs? Be sure to follow these steps to be sure your plan is on track!

Transfer your retirement accounts.
If you've found a new job, don't forget to move your retirement savings plan away from your old employer. This is because many employers charge maintenance fees for retirement accounts that belong to former employees. Consider rolling your retirement savings into your new employer's plan, put it into a LIRA through a brokerage firm. This will give you more investment options.
Start investing in your new employer's retirement savings plan if they offer one.
You don't want to take any unnecessary breaks away from your long-term savings plans.
Update your insurance policies.
Review your insurance needs and options and adjust accordingly, i.e., disability, life, health, auto, home, tenant, etc. For instance, if you are recently married add your spouse to your new policy.

Financial planning for women that are expecting a baby

Congratulations on starting a family! So, how do you plan your finances for a baby? Use these key steps to properly prepare your plan for your new addition.

Update your budget to include your baby's expenses
While having children is a blessing, they also come with their own expenses. You want to be sure that you include your child's expenses in your monthly budget. So, be sure to review and update your budget for when the baby arrives.
Know the costs of having a baby.
Consider what your costs of having a new baby will be initially. For instance, the cost of formula, diapers, clothes, childcare, etc., and plan accordingly by saving for the baby's needs before their arrival. Of course, you can learn ways to cut costs and save on items by being a thrifty shopper! But knowing the costs of having children is a vital part of financial planning for women.
Update your health and life insurance to include your child so they are adequately covered .
Having the proper insurance can cut costs on health care and take care of your children if something happens to you. Adjust your savings plans to include your baby
Bulk up your emergency fund to include your child's basic needs for 3 to 6 months as well .
Also, start putting money aside for your child's future expenses and university education.
Create an estate plan — it's an important part of financial planning for women
Having an estate plan is important, but even more when you have children. You want to ensure that everything is in place by choosing a guardian for your child and ensuring your assets are distributed as you wish.

Financial planning for women after a divorce or loss of a spouse

Unfortunately, divorces happen, but it's important to get back on your feet as quickly as possible when it comes to your finances .

Update your financial accounts .
Be sure to close all joint accounts and open new accounts in your own name. Update your beneficiaries on all your accounts, including your insurance and retirement savings accounts.
Make a new financial plan for your personal finances.
Learn how to budget on your own and review your finances every month at the very minimum. You also want to focus on rebuilding and take ownership of your finances in their entirety. For instance, budgeting, bulking up your emergency fund, tax planning, retirement savings, etc.
It's also a good idea to be aware of and review your CPP and OAS benefits.
Finally, it's important to understand the tax implications of inheriting any investment or retirement accounts due to the loss of a spouse.

Financial planning for women to take when caring for elderly

Your parents are important, so of course, you should include them in your plan .

Determine the cost of caring for your aging parents and include it in your financial picture to prepare for the expenses you must pay.
For instance, out-of-pocket costs to cover prescriptions, gas to doctors’ appointments, food, homecare, long term care and more.
Review their plan and determine how to fill in the gaps .
Determine what financial and health care options they have in place for themselves. This includes any government benefits, and then you can determine what gaps need to be filled.
Update your tax filing status to include your parents as dependents
This can help you get tax credits to aid in caring for your elderly parents.

Financial planning for women is key to your financial success.

Financial planning for women is essential for success, no matter what stage of life you are at.

Creating a plan and determining financial goals will help you take the steps needed to prepare you for emergencies and save for a comfortable retirement.

Benefits of Daily Walks

Wed, 14 Jun 2023 22:34:39 GMT

Often when thinking of exercise and a healthy lifestyle, the mountain feels steep. That is not the case for this friendly reminder! Below are some of the astounding physiological and psychological benefits of a simple 30-minute daily walk. It is truly one of the best fitness “hacks” out there.

And for such a simple and accessible form of exercise, it truly offers numerous health benefits.

Some of the obvious key advantages are:

Weight management: Walking can help you maintain a healthy weight or aid in weight loss by burning calories.

Cardiovascular health: Regular walking can improve your cardiovascular fitness by strengthening the heart, lowering blood pressure, and improving circulation. It reduces the risk of heart disease, stroke, and other cardiovascular conditions.

Mental well-being: Walking has been shown to have positive effects on mental health. It can help reduce symptoms of anxiety and depression, improve mood, boost self-esteem, and promote better sleep.

Bone and joint health: Walking is a weight-bearing exercise that helps improve bone density and strength, reducing the risk of osteoporosis. It also keeps the joints mobile, lubricated, and may alleviate joint stiffness and pain.

Improved digestion: Walking aids digestion by stimulating the muscles of the abdomen and intestines, promoting more efficient movement of food through the digestive system. It can improve overall gut health.

Enhanced immune function: Regular moderate-intensity walking can strengthen the immune system, making you less susceptible to common illnesses and infections.

Diabetes management: Walking can assist in managing blood sugar levels, improving insulin sensitivity, and reducing the risk of developing type 2 diabetes.

Increased energy levels: Engaging in regular walking can boost your energy levels by increasing oxygen flow throughout the body, improving cardiovascular fitness, and releasing endorphins, which are natural mood enhancers.

Improved cognitive function: Walking has been linked to better cognitive function and memory. It can enhance brain health and reduce the risk of cognitive decline and age-related diseases such as dementia.

Longevity: Studies have shown that regular walking is associated with a longer lifespan. It contributes to overall health and reduces the risk of chronic diseases, thereby increasing life expectancy.

A list that long is compelling, but what happens when you walk every day? Our bodies turn into fat burning machines! Walking primarily relies on fat as a fuel source, especially during longer, moderate-intensity walks. This can contribute to fat loss and help reduce overall body fat percentage.

It can also be responsible for an increased metabolism and appetite regulation by regulating your appetite and influencing hormones involved in hunger and satiety.

If you’re looking to:

· Reduce cravings

· Prevent overeating

· Improve portion control

· Reduce stress

· Maintain muscle mass

· Enhance mood

· Promote mindfulness and relaxation

· Improve cognitive function and creativity

· Improve sleep

· Help manage anxiety and depression

Consider implementing this social habit into your daily routine!

Your mind and body will thank you.

Source: https://www.boxrox.com/what-happens-to-your-body-when-you-walk-for-30-minutes-every-day/

Our Most Valuable Asset?

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 14 Jun 2023 22:17:47 GMT

What is our most valuable asset?

Lately I’ve been thinking about what is our most valuable asset. I’ve heard that it’s your ability to make money, or your home is your biggest asset.

I definitely think health ranks us there, but as I get older I’ve got a different perspective.

Our most precious asset is something that we all waste – time.

Time billionaires are commonplace. Despite what you hear, Baby Boomers aren’t our wealthiest citizens.

Young people with little to speak of regarding financial assets have something older folks like Warren Buffet and Charlie Munger can only dream about.

Think about it.

Every day is 86,400 seconds. A million seconds is almost 11 days. A billion seconds is slightly over 31 years. . . When you’re young, you are literally rich with time. At age 20, you probably have about two billion seconds left (assuming you live to 80). By 50, just one billion seconds remain.

Too many of us fritter away hundreds of millions of precious seconds on trivial pursuits instead of savoring the present moment.

We keep moving the goalposts to find happiness in things rather than connections.

Keeping up with the Joneses, owning the biggest homes, or delaying happiness into an unpredictable future never works. All the money in the world can’t quench a never-ending search for consumption.

Temporary happiness fades fast. Soon it’s on to something bigger, better, younger, and more attractive.

We are doomed to do it all over again.

Sahil Bloom puts it all together in his excellent post for Free Press:

" It's natural, but it’s a dangerous game—one that we will lose. . . eventually. We waste a lot of energy on the past and future when the present is all that’s guaranteed. We push for more—but really, we need to find our enough. Never let the quest for more distract you from the beauty of enough."

We must value time over money because things are replaceable; time is precious.

Assuming we have unlimited present moments creates a dreadful decision-making tree.

Time with family is a short-term asset that needs maximization of the moment, not distraction by the screen.

Take a look at these graphs for a dose of reality

You might not realize it, but the road from kindergarten to university is way quicker than you think.

The same goes for the lifespans of aging parents and other members of your extended family. As the years pass, you’ll likely spend unimaginable time alone.

We all live on borrowed time, and the interest rate is punishing.

Life has few guarantees, but one thing is almost inevitable for most of us. Whether you like it or not, you will run out of time before running out of money.

Keep that in mind in your decision process.

There are no do-overs for regret and time.

Choose wisely

Source: Source: https://www.thefp.com/p/the-time-billionaires-sahil-bloom

June Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 14 Jun 2023 22:07:45 GMT

Market Update: June 2023

At the start of the year, the market outlook was very pessimistic. In fact it was the most conservative RRSP season ever in Canada. And what happened? Markets surprised to the upside and have done very well, especially technology companies.

Why did that happen? The economy has been better than expected. The government’s money out during covid strengthened the finances of consumers especially in the US. You may have heard never bet against the US consumer.

What is the lesson? Markets do what markets do, so we need to set our plans up to meet our goals, within our own time frame, which is what we do. Another reminder (or lesson for those that haven’t learned it yet) is that markets are very difficult to time. No one can figure that out.

Here is a chart showing performance by asset classes to the end of March 31, 2023

It is almost silly to make predictions that are bound to be wrong, but I’ll say them anyways. There is still a concern about recession although it continues to get pushed back. No one knows for sure. And markets are forward looking and price in their future expectations.

Inflation is moderating which is great news It was fairly easy to go from 8% to 4%, but it will be more difficult to go from 4% back to 2%. As a result Central Banks are likely near the end of their increasing rate cycles. It’s possible interest rates could start to be reduced by the end of the year, although no one knows for sure and most expect into 2024.

The latest forecast from Goldman Sachs predicts the S&P 500 to be up a bit more by year end, so we will hope they are correct. In the meantime we invest in a variety of asset classes, across different geographies and investments to minimize our risks and take advantage of opportunities.

Source: NEI Investments.com

Here are the latest market numbers to June 15:

How do I Prepare for Separation?

laura@rightdirectionfinancial.ca (Laura Chanin) — Wed, 24 May 2023 19:00:02 GMT

Although no one plans for their marriage to end, a bit of planning in advance of separating will help down the road .

Lately, I’ve met a lot of people, women in particular who are separating from their spouse. It may be a bit depressing but since 48% of first marriages (and much higher for 2 ^nd marriages) end up this way, it is a reality. My friends that have divorced found it difficult, but in the end they are happy.

I attended a divorce and taxes workshop to sharpen my skills in this area.

Here are some tips that were written by John-Paul Boyd, Executive Director of the Canadian Research Institute for Law and the Family.

The tips are to help figure you figure out who owns what and to whom one of you owes any money.

Family property, family debts and excluded property

Take a careful, but not too obvious, tally of what each of you owns. This might be difficult if you and your spouse keep separate bank accounts and maintain your own investments, but make your best efforts. A list of your spouse's RRSPs, stocks, investments, bonds, GICs, cars, motorcycles, boats, ATVs, insurance policies, properties, and bank accounts may prove to be extremely useful.

One less obvious tip is to keep a record of the names of the financial institutions that are sending your spouse mail. You don't even need to open the envelope, just record the name and address. If your family has a safety deposit box, you should go to it and make a list of the contents. Make a list of the more valuable items in the family home.

Next, you should make your best efforts to find out what property you owned and what debts you were responsible for when you and your spouse began to live together or got married, whichever was earlier. The online statements most banks provide don't go back more than two or three years, so you may have to dig into your paper files or think about ordering old statements from your banks and other financial institutions.

New debts

Once you've decided that you're going to separate, stop involving yourself in shared debts. Don't sign any new credit card or loan applications, and especially don't sign any blank documents!

New property

Keep track of the money and property coming into the household. Make sure you know who bought it, why it was bought and with what money it was bought! If you have recently or are about to receive a personal gift like an inheritance keep it separate from the family finances.

Personal matters

Open a new bank account, in your own name, at a new bank, preferably a different one than your family uses. It's also a good idea for you to arrange for your personal mail to be sent elsewhere, like to a friend or a post-office box. You can file a notice of change of address with the post office and they will automatically redirect your mail for you. Finally, no matter how stressful your home situation is, don't quit work. You will, in all likelihood, need the income in the near future.

Leaving home

One word: don't ― at least not just yet. Your situation may be difficult, perhaps even intolerable, but don't leave the family home until you've seen a lawyer especially if you have children. You might find that living on your own is unmanageable; once you've left the family home it can be very difficult to get back in. Remember that you can be separated from your spouse and still live in the same home.

See a lawyer

Even before you've separated, it's usually a good idea to talk to a lawyer to get an idea of what your rights and duties are. Many lawyers will offer an initial interview at a flat or a lower rate. Use this opportunity to get the lawyer's opinion of your situation and an idea of what your options are. You may have an amicable relationship, but if you draw up an agreement between the two of you on your own without legal advice and there are issues later a judge would likely throw out the agreement.

Saving money for a lawyer

If you're worried about your spouse noticing from your credit card or bank statements that you've seen a lawyer, there's an easy way to save up enough for a small retainer, fee or the cost of an initial interview with a lawyer. Each time you take out money to buy groceries or clothing, keep a small amount aside, in cash, and save it in a place your spouse won't easily find. If a store lets you take extra cash when you pay with your debit card, take out as much as you can each time you go to that store.

It may take a while to save up enough money this way, but at least your spouse will never find out. Make sure you destroy the receipts from your shopping!

Source: John-Paul Boyd, Executive Director of the Canadian Research Institute for Law and the Family, and is an excerpt from JP Boyd on Family Law, a Clicklaw Wikibook © John-Paul Boyd and Courthouse Librarie s BC

The Power of Habits

Mon, 15 May 2023 21:43:19 GMT

The Power Of Habits

If you’re like us, the topic of Health and Wellness is often on our minds.

While ensuring our financial plan is set up to reach our goals is top priority, our physical health is also vital to ensure we can live those plans to the fullest. But good health has the potential to feel dauting at times. Busy schedules and long to do lists often trump the execution of what we consider a healthy lifestyle. Maybe we know we should be exercising a specific number of hours per week, or drinking enough water, and getting our vegetables.

Perhaps we’ve purchased cabinets of vitamins, or even toyed with the idea of a cleanse. And yes, we’re aware we need a minimum amount of sleep, but how much easier said than done?

Where to start…

Like anything else, my advice is always to keep it simple. It’s great to dream big, but the way to achieve big is to start small. Oftentimes we end up overwhelming ourselves with goals. But for true change to stick, the trick is habits. What I love about habits is how underwhelming, attainable and powerful one simple change can be. When it comes down to it, life is simply a combination of big and small habits that mold our day.

How we enjoy our coffee in the morning, or the snack we grab on the way out the door during a busy day. Or bigger habits, like the method we use to handle conflict. We are the designers, the decision makers and the creators of our choices and our habits. We have the power to add to our well-being or eliminate what stands in the way.

Here are a few tricks to making a new habit stick:

Identify a “ridiculously small” micro habit.

Whatever habit first comes to mind, cut it in half. Then cut it in half again. Starting small is the key to success.

Piggyback on a daily task .

Regardless of the size of the task, it’s easy to get distracted, make excuses, or forget. Perform your new action at the same time as (or right before) an action you do without thinking.

Track your progress.

As the saying goes, “What gets measured, gets done.” If your measurement process is elaborate, you’re less likely to complete it. Try a ‘Yes List’ requiring 20 seconds a day to complete. Write down the desired action and under each date, simply list a Y or N to indicate if you completed the task.

Hold steady for a long time.

It’s hard to think small to begin with; it’s even harder to stay small. Once you’ve stuck with your original micro habit long enough to feel bored with it for at least two weeks in a row, it’s time to increase it only by about 10%.

Seek help in holding you accountable.

It might sound strange to enlist a partner to monitor 30 seconds of meditation or doing two push-ups. But having people support you and hold you accountable can cement new behaviors, and it helps them in return.

Wherever you are in life, I encourage you to reflect on your habits and choose one to steer towards your goal. Start small and focus on it daily. If you are not in the habit of exercising, a goal of a daily workout is likely to fail. However, if you normally take an elevator to work, perhaps you could make a personal rule to opt for the stairs. Find a way to move that isn’t daunting and already fits into your lifestyle. Then focus on that one change until it becomes a habit. Changing one small habit at a time has the power to rewrite your health.

Remember, a small change that sticks, is big!

Source: https://hbr.org/2020/01/to-achieve-big-goals-start-with-small-habits

Stock Market Update

laura@rightdirectionfinancial.ca (Laura Chanin) — Mon, 15 May 2023 21:34:14 GMT

May 2023 Market Update- A tug-of-war on the Global Stock Markets

Throughout April and into May, the global stock markets were engaged in a tug-of-war, heavily reliant on economic data and corporate earnings, particularly in the United States. On one side, a strong job market, coupled with stagnant core inflation and impressive corporate earnings, provided support for a potential U.S. Federal Reserve rate hike. On the other side, concerns of a recession grew as growth slowed down.

Towards the end of the month, there was an update on the regional bank crisis in the United States. First Republic Bank's Q1 results revealed unexpectedly large deposit outflows, leading to a sharp decline in the bank's share price and reigniting concerns about the U.S. banking sector. Subsequently, JPMorgan Chase & Co. agreed to acquire First Republic Bank through a government-led transaction after financial regulators took control of the bank.

This is not the start of another 2008 financial crisis.

For the next while it is expected there will be continued volatility while the results of increased interest rates continue to be felt in the economy.

Let’s look at each market:

CANADIAN MARKET

+2.9% (S&P/TSX Composite 30-04-2023)
The S&P/TSX Composite Index advanced 2.9% during the month. All sectors, without exception, recorded gains during the period. Financials, Energy and Materials were the main contributors. The Canadian bond market also had a positive return for the period, with the FTSE Canada Universal Bond Index ending the month up 1.0%.

U.S. MARKET

+1.8% (SP 500 30-04-2023 in CAD)
On the strength of corporate earnings that beat expectations, U.S. stocks ended the month up 1.6% as measured by the S&P 500 Index. Most of the results looked resilient, particularly those of the U.S. Big Tech stocks, despite uncertainty about the future of the economy.

Health care, Financials and Communication Services were the main contributors, while Industrials and Consumer Discretionary detracted from the return the most. The currency effect had a negligible impact on the return to Canadian investors, which was 1.8% for the month.

EUROPEAN MARKET

+4.5% (MSCI Europe 30-04-2023 in CAD)
The European market continued its momentum, closing the month with another gain. The MSCI Europe Index advanced 2.6% in local currencies. The Canadian dollar’s weakness against the euro and the pound sterling boosted the return to 4.5% in Canadian currency. Health care contributed the most to the return, followed closely by Financials and Consumer Staples. Only Information Technology had a negative return.

ASIAN MARKET

-0.8% (MSCI Asia-Pacific 30-04-2023 in CAD)
The results were more mixed for the Asian market. The MSCI All Country Asia Pacific Index ended the month with a return of 0.1% in local currencies and -0.8% in Canadian dollars. As on the Western markets, Financials rebounded from the March rout and contributed the most to the return. Even so, negative returns for Communication Services, Information Technology and Consumer Discretionary dragged the index down. From the regional standpoint, India, Japan and Indonesia were the main contributors, while China and Taiwan detracted from the return.

EMERGING MARKETS

-0.9% (MSCI Emerging Markets 30-04-2023 in CAD)
The situation was similar in emerging markets, with the MSCI Emerging Markets Index ending the month with a return of -0.7% in local currencies and -0.9% in Canadian dollars. The decline was due mainly to weak performances by the stock markets in China and Taiwan, despite relatively solid performances by India, Saudi Arabia and Brazil. Even though China has reopened its economy and ended the pandemic-related restrictions, weaknesses in the global economy weighed on its manufacturing industry.

Here are the market results to May 12, 2023:

Sources: Bank of Canada, FTSE International Limited, S&P Dow Jones Indices LLC and MSCI Inc.

Is Stress Impacting Your Health?

Fri, 14 Apr 2023 19:21:53 GMT

Is Stress Impacting Your Health?

When planning for the future, most agree that health and wellness play a vital role in our ability to thrive and enjoy a full life. While exercise and nutrition are important to prioritize, for many of us stress could be impacting our well-being more than we know. Let’s consider the effects of chronic stress. What exactly happens to our bodies under pressure?

Brain: The body’s stress response is triggered when the brain’s hypothalamus sends a signal to the pituitary gland, located at the base of the brain. This glans then signals the adrenal glands (located above the kidneys) to release stress hormones. These hormones change how organs and systems act to prepare the body to fight or take flight.

Heart: Heart rate and blood pressure increase so that blood travels through the body faster. This helps deliver oxygen to power the muscles.

Lungs: Breathing rate increases to deliver more oxygen throughout the body to power muscles and tissues.

Muscles: Muscles tense up to prepare the body for action.

Liver: The liver causes more glucose (blood sugar) to be released into the bloodstream. This powers cells in the body.

Stomach/Intestines: Digestion decreases. This redirects energy that would be used to break down food to power other parts of the body.

Sweat Glands: Stress-triggered sweat is chemically different from sweat that cools the body. Stress sweat interacts with bacteria on the skin to cause body odor.

Ongoing or chronic stress does not allow the body’s stress hormones to return to normal levels. This can lead to many health problems. Chronic stress can:

· Increase your chances of getting sick by weakening your immune system.

· Cause sleep problems because of the energy surge brought on by stress hormones.

· Lead to injuries or migraine headaches from constant muscle tension.

· Increase the risk of certain mental health problems, such as depression and anxiety.

· Lead to problems with learning and memory.

· Increase the risk for chronic health problems such as heart disease, obesity, and diabetes.

Healthy Ways to Cope

Move your body! Regular aerobic exercise activates the body’s stress response. But this is actually “good stress” and helps the body cope with psychological stress.

Meditate. Meditation and deep breathing exercises can decrease blood pressure and improve symptoms of anxiety and depression.

Take a Tech Time Out. Stepping away from distractions such a social media and texting may be stressful at first, but with practice can help you relax.

Do One Thing at a Time. If you feel overwhelmed with multitasking, try to tackle one challenge at a time.

Get Support. If you are stressed, ask for help from family, friends or a professional, such as a doctor or counsellor.

Source: Scholastics and the scientists of the National Institute on Drug Abuse, National Institutes of Health, U.S. Department of Health and Human Services.

Retirement: History Timeline

laura@rightdirectionfinancial.ca (Laura Chanin) — Fri, 14 Apr 2023 19:10:54 GMT

The History of Retirement

In 2020 the average retirement age for all retirees in Canada was 64.5 years old, according to Statistics Canada. The average life expectancy is around 80 for men and 82 for women in Canada. So that means men are in ‘retirement’ for about 15 years and women over 17. Has it always been this way?

How did retirement come about?

Believe it or not, the invention of retirement can be traced back a long way, to 13 B.C. when the emperor Augustus instituted a pension program for Roman legionnaires who served in the military for 20 years. It was believed that he enacted this as a way of preventing an uprising against him and the Roman empire.

In more ‘modern times’ the concept of retirement began in 1889 when German Chancellor Otto von Bismarck of Germany put forth the idea of paying citizens 70 and older to leave the workforce ‘voluntarily’ to make room for the younger workers as unemployment was high.

Germany’s system was mandatory with contributions from both employers and employees along with the government to fund the program. This system became part of a comprehensive social insurance plan that included a form of worker’s compensation and sickness insurance. In 1916 the age was lowered to 65. The US took inspiration of Germany’s model and started the Social Security program in 1935. The average life expectancy at that time was 62 so they didn’t really expect to pay retirees for very long!

What about retirement in Canada?

McKenzie King, Canada’s prime minister at the time, introduced the Old Age Pensions Act in 1927 which became the Old Age Security in 1951. Canada Pension Plan (CPP) was added in 1966 by Lester B Pearson’s government and then in 1967, the GIS (Guaranteed Income Supplement) was brought in to help bring poor seniors’ income over the poverty line.

How have pensions changed in Canada?

In recent times, pension plan membership through work has declined. Only 33% of employees have an employer defined benefit pension whereas it was 40% in the 1970’s as unions worked to gain security for their members. In 2004, the Monsanto vs. Ontario case upheld the supreme courts decision requiring surplus pension assets to be distributed to terminated employees in a partial winding up of a pension plan. Because of this ruling, companies have backed away from defined benefit pension plans.

Many Canadians are still struggling to save for retirement. In 2017 there was bit of modern pension reform with Ontario introducing a mandatory plan for those employers and employees that have no pension plan in place. At a cost of $3.5 billion a year the hope is that this will help many Ontarians saving for retirement.

In the 1990’s Canadians were worried that the CPP funds were running out and would not be able to support the millions retiring in the years following. This is funded based on contributions from workers. In 1990, the employee and employer contribution rates were each 2.2%. Over time this has increased and is now 5.95% each, and the reserves are in great shape. The OAS which is funded out of general revenues costs taxpayers $36.5 billion a year.

This is projected to increase to $108 billion by the year 2030.

Sources:

https://retirehappy.ca/a-history-of-pensions-in-canada/

https://www.cppinvestments.com/

https://www.investmentexecutive.com/news/from-the-regulators/supreme-court-backs-ontario-in-monsanto-pension-case/#:~:text=The%20Supreme%20Court%20of%20Canada,up%20of%20a%20pension%20plan. -

https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/canada-pension-plan-cpp/cpp-contribution-rates-maximums-exemptions.html

Stock Market Update ~ April

Fri, 14 Apr 2023 18:13:11 GMT

April Market Update

Since October, stock markets have continued to do better in spite of there being lots of bad news in the media.

We do have to remember the expression ‘if it bleeds it leads’. So remember to look at the positive things around us – inflation is decreasing and unemployment is still very low.

Year to date we are at:

Here is a more detailed outlook from NEI Investments:

Source: Manulife Investments

March Market Update

Thu, 23 Mar 2023 16:55:04 GMT

Market Update for March 2023

The S&P 500 index rose 1.4% last week, recovering some but not all of the previous week's tumble, as some investors saw the recent stock market declines as presenting buying opportunities while a show of support among big banks for First Republic Bank ( FRC ) also provided some relief.

The market benchmark ended Friday's session up 2% for the year-to-date but down 1.3% for March to date.

The S&P 500 slid 4.5% last week amid the collapse of Silicon Valley Bank. Since then, Signature Bank also collapsed, and financial stocks tumbled as investors worried about what other banks might be next. Concerns ramped up last week over First Republic Bank, but on Thursday, a group of 11 banks announced $30 billion in deposits into First Republic Bank in a show of support that helped ease fears a bit. Still, investors remain wary.

The communication services sector had the largest percentage increase last week, climbing 6.9%, followed by a 5.7% rise in technology and a 3.9% increase in utilities . Other sectors in positive territory for the week included consumer discretionary , health care , consumer staples and real estate .

The energy sector led to the downside, falling 7%, followed by a 6.1% drop in the financial sector. The materials sector also was in the red, down 3.5%, followed by a 2.5% decline in industrials .

Next week's economic calendar will be light with no major reports expected on Monday and only February existing home sales anticipated on Tuesday. However, the market will be heavily focused on a two-day Federal Open Market Committee meeting that concludes on Wednesday with a rate decision.

Source: https://ycharts.com/

Here’s the latest 2023 outlook from JP Morgan Asset Management

• Near-term recession is too close to call. However, lower inflation and slower growth over the next few years seem very likely.

• After a dreadful year, return prospects for bonds in 2023 look much better as the Federal Reserve concludes its rate hiking cycle. Investors can take advantage of higher yields in short-dated bonds while adding duration as a hedge against market volatility and maintaining a high quality bias in credit.

• Globally, 2023 should see substantial (albeit incomplete) normalization in inflation levels, a pause in central bank increases and a hangover for the real economy from last year’s inflation surge and aggressive rate hikes. China may be an exception to the rule of global deceleration, with a slow (but bumpy) shift away from “zero COVID”.

• U.S. equity returns will be driven by earnings against a backdrop characterized by elevated market volatility. In this environment, companies with pricing power and stable cash flows – that are trading at reasonable valuations – are most attractive.

• While risks around the international growth outlook are high for 2023, they are also much better reflected in equity valuations (and currencies) – and “less bad” news can be enough to fuel a powerful rebound once the worst is priced into earnings expectations.

• Alternatives have benefited from an environment of easy money for the past decade – a trend that has come to an end. The new combination of higher rates and demand for capital will allow for more differentiation between winners and losers.

• ESG was confronted with headwinds in 2022, yet commitments from policymakers this year could fuel investments in sustainable technology and infrastructure for the next decade.

• Despite uncertainty on the horizon, significant valuation imbalances across markets mean there is more upside potential than downside risk in investing today

Source: JP Morgan Asset Management

As always, let me know what questions you have.

February Market Update

Tue, 21 Feb 2023 19:06:05 GMT

Fine-tuning your investments for continuing inflation — and slower growth

After a difficult 2022 in which major stock indexes posted their worst performances since 2008, stocks are off to a strong start in 2023.

The S&P500 and TSX/S&P are both up over 6% for the year with most of that gain coming in January, which marked the best monthly start to the year in four years.

Whether the strong run is a harbinger of what’s to come or proves to be another bear-market rally is up for debate, with arguments on both sides. The major dividing lines: whether the U.S. economy can avoid recession; whether the Federal Reserve keeps rates higher for longer, pauses, or even eases; and the outlook for corporate earnings.

These six steps could help you keep your assets properly diversified and aligned to meet your long-term objectives.

Revisit your investment goals .

Always a good idea to do this if it has been a while. Start by thinking about your personal goals and whether they’ve changed since your last review. Once you’ve updated your goals, make sure your asset allocation strategy aligns well with them. If you have a shorter time horizon, for example imminent retirement, or plans to make in big purchase such as a cottage in the near future — may call for more conservative investments and term deposit rates are now better than in the past.

2. Look at rebalancing your investments to maintain your asset allocation .

It may have shifted to make your portfolio more aggressive or conservative than you want. We call this Periodic rebalancing — selling some assets that have performed well — which is essential to staying properly diversified.

3. Evaluate concentrated positions .

If you have large, concentrated holdings in a specific company or asset class, carefully examine whether they still make sense for you. Concentrated positions add risk. Those risks may be less pronounced when assets are performing well. Volatile markets, in contrast, underscore the importance of staying diversified, so that a drop in any specific investment doesn’t unduly harm your investments.

4. Consider active investing.

Passive investing — a kind of set-it-and-forget-it strategy that minimizes buying and selling of assets — has grown in popularity in recent years. Exchange traded funds (ETFs), for instance, which seek to replicate the returns of broad indexes, are a common form of passive investing, and they perform well during surging markets. At a time of slower growth and greater volatility, however, passive investing may become less effective. Active investing involves funds whose managers use their experience to select assets that may outperform indexes. While there are no guarantees that active investing will generate specific returns or outperform passive investing, these skills come to the fore when markets overall are growing more slowly. This may be a time when active managers can add meaningful value to portfolios and complement passive investing.

5. Add some alternative investments.

Investments outside of the traditional stocks and bonds can provide further diversification to reduce risks and lower volatility. A good example of this is the Canada Pension plan which has increased their alternative investments over time by owning private investments including private debt, real estate and private equities.

6. Invest tax-efficiently .

Looking to reduce taxes? Consider holding less tax-efficient investments in tax-advantaged accounts and more tax-efficient investments in taxable accounts. And if volatility drives down the value of some investments you’d like to sell, “taking advantage” of those losses in your taxable accounts this year could help offset taxable capital gains from investments that have performed well.

As you consider these steps, keep in mind that short-term buying and selling in anticipation of market swings isn’t among them. Many studies confirm that attempts to “time” the markets by getting in and out usually fail, and that missing even a handful of the best market days could have serious consequences on your overall returns.

The best approach is to stay invested in a portfolio that’s diversified across and within asset classes.

How things are looking as of February 17th, 2023

Sources:

https://www.bnnbloomberg.ca/

https://ca.finance.yahoo.com

January Stock Market Update

laura@rightdirectionfinancial.com (Laura Chanin) — Mon, 16 Jan 2023 18:04:32 GMT

Turning the corner

2022 can be classified as the year of many unexpected negative surprises in the financial markets.

The main surprise was higher stubborn inflation and central banks’ reactions to it. As an example, in the US, it was expected at the start of 2022 that the U.S. Federal Reserve would raise interest rates by approximately 1% at most. But stubbornly higher inflation resulted in an increase to 4.5% by end of year.

This is the fastest tightening of interest rates in 40 years.

Source: Management Investment Management with permission

Secondly, an unexpected conflict in Ukraine in February added fuel to the inflationary fire by impacting energy and food prices.

And finally, China’s ambitious zero-COVID policy resulted in large-scale shutdowns of major city centers—including Shanghai and Beijing, which delayed the full opening of supply chains, negatively impacting global economic growth.

Other than cash, there were very few areas to protect your investments. The S&P 500, S&P/TSX Composite, Nasdaq Composite, and MSCI EAFE Indexes were all down 12.4%, 5.8%, 27.8% and 7.9% respectively, in Canadian Dollars, including dividends.

Global equity, commodity, currency, and yield data

Source: Manulife Investments Management

In addition bonds, which typically provide protection when stocks go down, were also negative 11.7%, 13.0% (USD), and 16.3% (USD)* as measured by the FTSE Canada Universe Bond, Bloomberg US Aggregate, and the Bloomberg Global-Aggregate Total Return Indexes.

*Source: www.bloomberg.com

2022 was one for the record books. Since 1926, 2022 has been the only year where the S&P 500 and U.S. Treasuries bonds were both down more than 10%!

Many investors are saying good riddance to 2022. So how do we think 2023 will unfold?

Global Economy

There are continued reasons to think the global economy will continue to slow in 2023 and it is expected there will be a recession in 2023. Will it be mild or severe? The current thought is that it will be mild in the US and might be more severe in Canada and Europe. The reason is that the US labour market is very strong – unemployment is still very low with lots of job openings.

Equity Markets

Now that stock prices have gone down so much they are much more in line with their long term averages (see chart below). There will likely be a choppy equity market environment in the short term until there is more clarity about how companies are managing during the economy slowdown.

Which investments do better after a bear market? Here is a chart showing 1 and 2 year returns after a market bottom since 1970 and the best performers are companies in the Nasdaq indices and US Mid sized companies.

Source: Manulife Investment Management

Why would we continue to invest even though we expect a recession and earnings to decrease? Because we never know when the market will recover and if you miss some of the good days it impacts your entire return. So we stay invested (or dollar cost average in with new money) and focus on investments that pay dividends to try to do our best.

In addition a lot of the bad news has been priced in already.

Source: Manulife Investment Management

Fixed income

Many bond managers are very excited about the opportunities for bond investing.

One of the managers at Manulife Strategic income said this is the single best time to buy in the last 15 years. Why is that? Because bond prices came down so much last year, there are opportunities for some gains in prices and because yields are so much higher, due to increasing interest rates that they provide a good income source. The yield on Manulife Strategic Income is currently 6% on average with all their holdings.

However, as the economy changes throughout this year, which bonds do better will change so you need to be flexible about what you own.

Here is also a chart showing that 80% of the time bonds pay a higher return than GICs, so even with the decent rates available at the banks it is likely better to invest in bonds.

Source: Manulife Investment Management

Interest rates

The thought is that the US Federal Reserve and Bank of Canada will stop their interest rate increases sometime between March to May and then pause to see their impact. They are fighting inflation which is slowly coming down. The thought is eventually interest rates will be able to be reduced again but that may take time. Once that happens it is thought stock market returns will be positive as well as bond returns

Final Thoughts

As we settle into a new year with the realization that the global economy is slowing, geopolitical risks remain heightened, inflation is slowly falling, and the Bank of Canada and US Federal Reserve is nearing the end of its interest-rate increases, it can be easy for investors to still feel quite nervous about the state of things. However, despite these setbacks, we think the patient and flexible investor will be rewarded very well in the long.

There’ll be more twists and turns and bumps along the way, but we need to remain focused on the road ahead to make sure we arrive at our destination

2022 Year End Checklist

Tue, 13 Dec 2022 20:42:52 GMT

2022 Year End Tax Info Sheet

Welcome to our year end tax info sheet. Here are changes in numbers and ideas to keep in mind to help with your taxes:

Are you prepared to meet upcoming deadlines to achieve 2022 tax savings?

Investments

Have you maximized your TFSA contribution?
Should you sell investments with unrealized capital losses/gains?

Family

Have you considered income splitting loans with family?
Are you moving to a new province/territory?
Did you sell your home?
Are you saving for your first home?

Retirement and estate planning

Have you maximized your RRSP contribution?
Is it time to wind up your RRSP?
Do you have a trust (including a bare trust)?

Other planning opportunities

Did you contribute to a RESP for a child?
Have you made a charitable donation?
Do you drive a company car?
Have you paid your personal tax instalments?
Do you need to make a taxpayer-relief request?

Payments due by December 31, 2022

Charitable gifts
Medical expenses
Union and professional membership dues
Investment counsel fees, interest, and other investment expenses
Certain child and spousal support payments
Political contributions
Deductible legal fees
Interest on student loans
Contributions to your RRSP if you turned 71 during 2022 (you will also have to wind up your RRSP by this date).

Payments due by January 30, 2023

Interest owed on intra-family loans
Interest payable by you on loans from your employer, to reduce your taxable benefit.

Payments due by February 14, 2023

Reimbursement of personal car expenses to your employer to reduce your taxable operating benefit from an employer-provided car.

Payments due by March 1, 2023

Deductible contributions to your own RRSP or a spousal RRSP
Contributions to provincial labour-sponsored venture capital corporations
RRSP repayments under a Home Buyers’ Plan or a Lifelong Learning Plan

PERSONAL INCOME TAX RATES

The combined federal and provincial top marginal tax rate in BC remains at 53.50% once your income is excess of $227,000.
The maximum marginal tax rate for eligible Canadian dividends for 2022 is 36.54%.
The maximum marginal tax rate for regular dividends for 2022 is 48.89%.

BASIC PERSONAL AMOUNT

The basic personal amount for 2022 is $14,398 for taxpayers with net income of $155,625 or less.
The basic personal amount for 2023 is $15,000 for taxpayers with net income of $165,430 or less.
At income levels above $165,430, the basic personal amount is gradually clawed back until it reaches $13,521 for net income of $235,675.

RRSP CONTRIBUTIONS

March 1, 2023 is the last day you can contribute to an RRSP and deduct the contribution on your 2021 personal tax return. However, the earlier you make the contribution, the more time you have to let your tax-sheltered retirement income funds grow.

Your 2022 RRSP “contribution limit” is equal to 18% of your 2022 “earned income” up to a maximum contribution limit of $29,210, plus any unused contribution room from prior years. The 2023 limit is $30,780.

Earned income generally consists of net income from employment, business, and rental.

If you turned 71 during 2022 you must wind up your RRSP by the end of the year. Therefore, the last day you can contribute to your RRSP is December 31, 2022. However, if you have “earned income” in 2022, you will be entitled to additional contribution room for 2022.

If you are over the age of 71, you can still make contributions to a spousal RRSP up to the end of the year your spouse turns 71.

TFSA CONTRIBUTIONS

You can contribute up to $6,000 to a TFSA for 2022 if you are a Canadian resident age 18 or older. Any unused contribution room can be carried forward indefinitely, so this limit may be higher if you did not contribute to a TFSA in a prior year. For example, if you have never contributed to a TFSA, you may be able to contribute a total of $81,500 before December 31, 2022, or $88,000 by the end of 2023.

Contributions to a TFSA are not tax deductible, but investment income earned in the TFSA is tax-free, and you can make tax-free withdrawals from the TFSA at any time. When you make a withdrawal, the amount withdrawn will be added to your contribution room for the following year, so that it can be re-contributed in or after that following year.

Be careful as over-contributing to your TFSA may result in a penalty of 1% per month on the amount off excess TFSA contributions until you have withdrawn the excess amount or more contribution room becomes available in the subsequent year.

Maximum CPP pensionable earnings : For 2023, the maximum pensionable earnings amount is $66,600 (up from $64,900 in 2022), and the basic exemption amount remains $3,500 for 2022 and 2023.

Maximum EI insurable earnings : The maximum annual insurable earnings (federal) for 2023 is $61,500, up from $60,300 in 2022.

Home buyers’ amount : Did you buy a home? You may be able to claim up to $5,000 of the purchase cost and receive a non-refundable tax credit of up to $750.

LIFETIME CAPITAL GAINS EXEMPTION

The lifetime capital gains exemption limit increased to $913,630 (from $892,218 in 2021) effective for dispositions of ‘qualified small business corporation’ shares by individuals occurring in 2022. The lifetime capital gains exemption limit on qualified small business corporation shares is indexed to inflation for future tax years.

REGISTERED EDUCATION SAVINGS PLAN (RESP) CONTRIBUTIONS

December 31, 2022 is the last day you can contribute to an RESP and receive a Canada Education Savings Grant (CESG) for 2022. There is no maximum annual RESP contribution limit, but the lifetime maximum contributions are $50,000. CESG grants are calculated at 20% of your RESP contributions, subject to an annual limit of $500 ($1,000 if there is unused grant room from a previous year) per child under the age of 18 and a lifetime limit of $7,200. Additional age restrictions apply for RESP contributions and withdrawals.

Families with a total income of less than $100,392 may qualify for increased CESG benefits on the first $500 of RESP contributions.

All B.C. children born on or after January 1, 2006 who have an RESP are entitled to receive the $1,200 B.C. Training and Education Savings Grant. To access the grant, families must open a RESP and apply for the grant before the child turns nine years old. A family may only apply for the grant once the child has turned six years old.

CHILD CARE EXPENSES

Subject to certain limitations, childcare expenses incurred during the year may be claimed as a deduction from income. In two-parent families, childcare expenses must generally be claimed by the lower income spouse. The maximum deductible amounts are $8,000 for each child under the age of seven at the end of the year, and $5,000 for each child between the ages of seven and sixteen at the end of the year.

If your child is eligible for the disability tax credit, the limit for childcare expenses for any age is increased to $11,000.

The total deduction for childcare expenses cannot exceed two-thirds of the earned income of the person claiming the deduction.

Remember that boarding school and camp fees can qualify for the childcare deduction (limits apply), and that you’ll need to keep receipts for all childcare expenses.

CANADA CHILD BENEFIT

The Canada Child Benefit (CCB) is a tax-free monthly payment made to eligible families. The CRA uses your income tax and benefit return from the previous year to determine the amount of CCB payments you are entitled to.

To qualify for the CCB payments, you and your partner must file your return every year even if you did not have any income in the year.

Benefits are paid over a 12-month period starting July and ending in June of the following year. Your benefit will be recalculated every July based on your income tax and benefit return from the previous year.

The B.C. family benefit, (previously called the B.C. child opportunity benefit) provides a tax-free benefit of up to $133.33 per month for the first child, $83.33 per month for the second child, and $66.67 per month for each additional child under the age of eighteen. The amount is combined with the CCB into a single monthly payment. The benefit is reduced if the family’s net income exceeds $25,800.

Eligible families with net income below $25,800 can get a temporary benefit enhancement for January 2023, February 2023 and March 2023 of up to $191.66 per month for the first child, $141.67 per month for the second child, and $125.00 per month for each additional child under the age of eighteen.

Children must be registered for the CCB to receive the BCCOB. Those who are not already registered will need to apply for the CCB through the CRA. Children who are already registered for the CCB will automatically be registered for the BCCOB.

STUDENTS

Scholarships and Other Prizes − All scholarship, fellowship, bursary, or prize income received from a program that entitles the student to the education tax credit is tax exempt. Where the student is enrolled in a part-time program, the exemption applies only to the extent the award covers tuition fees and costs incurred for program-related materials. For other scholarships, fellowships, bursaries, or prizes, the first $500 is tax exempt.

Tuition Credits – Tuition fees and student loan interest must be paid on or before December 31, 2022 to qualify for a tax credit in 2022. Unclaimed tuition credits can be carried forward indefinitely (or transferred to a supporting parent, grandparent, or spouse up to certain limits), while unclaimed credits for student loan interest can be carried forward for five years.

Foreign University Tuition Fees – If you attended a foreign university, your tuition fees may be eligible for a tuition credit in Canada. To support such fees, you must have the foreign university complete a Form TL11A, Tuition, Education, and Textbook Amounts Certificate – University Outside Canada, and provide the form to CRA upon request.

REGISTERED DISABILITY SAVINGS PLAN (RDSP)

You can set up an RDSP for a child if he or she qualifies for the disability tax credit. The maximum lifetime contribution limit is $200,000 per child, and contributions are not tax deductible. Income earned inside the plan is exempt from tax and withdrawals are taxable to the beneficiary.

Contributions may be receive significant government grants i.e. up to a maximum of $3,500 in matching grants in one year, and up to $70,000 over the beneficiary’s lifetime depending on the beneficiary’s family income and contribution levels.

Disability amount : The amount for 2022 is $8,870 (non-refundable credit; with a supplement up to $5,174 for those under 18 (the amount is reduced if childcare expenses are claimed; $5,053 in 2021).

Child disability benefit : The child disability benefit is a tax-free benefit of up to $2,985 or $248.75 a month (2022) for families who care for a child under 18 with a severe and prolonged impairment in physical or mental functions.

MEDICAL EXPENSES

Medical expenses you wish to claim in 2022 must be paid within any twelve-month period ending in 2022 to obtain a tax credit. The credit is equal to the medical expenses incurred, minus the lesser of (i) 3% of net income and (ii) $2,479, multiplied by 15%. For the 2022 tax year, the maximum is 3% of net income or $2,479, whichever is less.

Expenses for medical or dental services (including related expenses such as travel) which are purely for cosmetic purposes do not qualify for the medical expense credit.

CHARITABLE DONATIONS

Charitable donations must be made on or before December 31, 2022, to qualify for a tax credit in 2022. Donations may be claimed up to an amount not exceeding 75% of net income. Donations in excess of 75% of net income can be carried forward and deducted for up to 5 years.

For deceased taxpayers, the limit is increased to 100% of net income in both the year of death and the preceding year (taking into account bequests or legacies in the deceased’s will).

Donations of certain publicly traded marketable securities that have appreciated in value can offer even greater income tax benefits than cash donations. The inclusion rate for capital gains realized on the disposition of securities by way of donation is reduced to 0% (instead of the normal capital gains inclusion rate of 50%). Therefore, instead of selling securities with accrued gains to make a cash donation, consider donating the securities instead.

Donating publicly-traded marketable securities that are in a loss position can also be effective as you will receive a donation receipt for the fair market value of the securities at the date of the donation, and you will also be able to use the capital loss.

POLITICAL DONATIONS

Political donations must be made on or before December 31, 2021, to qualify for a tax credit in 2022. The maximum credit available for federal political donations is $650 on $1,275 of donations. The maximum credit available for B.C. provincial political donations is $500 on $1,150 of donations.

MOVING EXPENSES

If you moved within Canada during the year, your moving expenses may be deductible. In order to qualify, you must start employment or operating a business at a new location, and your new home must be at least 40km closer to the new location than your old home.

The deductibility of moving expenses is limited to the income earned at the new location in the year and can be carried forward indefinitely. Moving expenses include out-of-pocket costs for moving, realtor’s commissions and legal fees on the sale of your old home, and the property transfer tax and legal fees paid on the purchase of your new home.

If you moved into or out of Canada during the year but remained a Canadian resident for income tax purposes while you were abroad, you may also be able to deduct your moving expenses.

Over 65?

Age amount : You can claim an age amount if you were 65 years of age or older on Dec. 31 of the taxation year. The maximum amount you can claim in 2022 is $7,898, up from $7,713 in 2021.

OAS recovery threshold : If your net world income exceeds $81,761 in 2022 you may have to repay part of or the entire OAS pension.

Sources :

https://www.canada.ca/

https://home.kpmg/ca/en/home/insights/2022/11/2022-year-end-personal-tax-planning-tips.html

https://www.dhgroup.ca/news/

December Stock Market Update

Tue, 13 Dec 2022 20:16:53 GMT

Market Update

What can I say about the markets for next year? As you probably know, this year stock markets turned out differently than most of us predicted last December so any predictions are likely to be off! That said, we seem to be gaining more certainty with where inflation is going, and therefore interest rates which should stabilize the stock markets.

For some commentary about the outlook for next year here are the thoughts of one of AGF’s top global managers, Tony Genua:

A Tale of the Twenties: The Roaring 1920s and the Boomerang 2020s

Historically, investing in stocks after a 20% decline has tended to yield good outcomes for investors.

The first years of the 2020s have seen some tumultuous events, to be sure, but many have a common aspect: they signal a return to previously existing conditions. Indeed, the 2020s remind us of a boomerang, returning some conditions of what we might have thought were in the distant past, but are now influencing the investment landscape.

If we look for precedents, we might turn to the 1920s, an era that also saw a meaningful transition – albeit one that did not end so well. The decade earned its nickname – the Roaring Twenties – by being a time of dramatic change and growth. The stock market boomed, and Western society enjoyed unmatched prosperity and cultural advancement.

This included:

• Real GDP growth averaging 4.2%;

• The Dow Jones Industrial Average rising 600% between 1921 to 1929;
• A material reduction in taxes, with the top U.S. rate dropping from 73% to 24%;
• Car, household appliance and home ownership becoming widespread;
• The beginning of commercial aviation; and
• Credit exploding with margin debt and consumer instalment payments.

There were other breakthroughs, too.

After a difficult start to the decade, farmland productivity and incomes rose sharply. Communications improved with the move from the telegraph to the telephone. Women finally earned the right to vote. The discovery of penicillin improved life expectancy. Pre-sliced breads became available, the TV was invented and radio vastly improved with the introduction of the first commercial station, which in turn helped usher in the Jazz Age. And before the dawn of memes, flagpole-sitting became a thing.

As a whole, the 1920s made for a rip-roaring decade – until, of course, its excesses ultimately resulted in the stock market crash of 1929.

A hundred years later, we are seeing trends that suggest we are boomeranging back to the future. Inflation has returned, reaching its highest levels in 40 years, and interest rates have been rising rapidly in response. Debt as a percentage of GDP has climbed, and energy prices have rebounded. On the geopolitical front, with conflict abroad and escalating tensions, the world is increasingly deglobalizing, reversing the trends of the past several decades. All of this has caused stock market volatility to rebound, with the highest levels of trading days +/- 1% since the Global Financial Crisis.

U.S. S&P 500 Total Returns (1937-2022)

Source: AGF Investments Inc., as of November 28, 2022.

Is this period, like the 1920s, bound to end in disaster? We don’t think so. Some important trends are moving us forward. Innovation continues to result in new investment opportunities. Sustainability, precision medicine, autonomous vehicles, robotics and artificial intelligence, among other innovations, represent a ripe landscape for future investment. And despite the whirlwind of global events over the past three years, overall returns so far in the 2020s have been remarkably normal.

The annualized return of the S&P 500 Total Return Index since Jan. 1, 2020 (through November 25, 2022) has been 9.7%, according to Bloomberg data, which is close to the long-term total return of U.S. equities of 9.5% over the past 120 years. Furthermore, over the course of history, U.S. equities have tended not to experience two negative years in a row. There are bubble-related exceptions, like the “Nifty Fifty” and the “Tech Bubble” of the early 2000s, but the most common outcome has been returns in the 10% to 20% range in the year following one that saw negative returns.

Given widespread investor pessimism today, this is useful context. Historically, investing in stocks after a 20% decline has tended to yield good outcomes for investors. We believe this time will be no different – this does not look like 1929 all over again. And investors will be well served to stay invested and focus on the long term.

https://www.agf.com/ca/en/insights/outlook/ac-roundup-equities.jsp

Let me know if you have any questions.

What’s the Cost of a University Education?

Thu, 24 Nov 2022 00:05:34 GMT

What’s the cost of a University Education?

When I was a student, being low budget was a thing! Those days are gone, with 2 daughters in university, I can tell you the costs are through the roof, in the end will add up to a down payment on a house!

I learned (working for the Ministry of Advanced Education in the 90’s) that, in BC, 80% of the cost for university was government subsidized. I’m not sure what % is today, but the government contribution are why costs are lower than many US universities.

What are the costs?

The two biggest when a student goes to post secondary are:

1. Food and shelter (what I like to call that “living”)

2. Tuition

Starting with living costs, if your child lives at home, the costs are significantly less. But nothing beats experience of living away from home for the first time. I loved living in res!

FIRST YEAR RESIDENCE

Here are some sample costs, they all include a (delicious��) meal plan:

Sources:

https://www.uvic.ca/residence/future-residents/fees/index.php

https://okanagan.housing.ubc.ca/applications/fees-payments/

https://vancouver.housing.ubc.ca/applications/fees-payments/

https://residence.uwo.ca/applying/fees_and_payment

https://www.queensu.ca/residences/apply/residence-fees

https://www.mcgill.ca/students/housing/fees-applying/undergrad-downtown-fees

After first year most kids leave campus housing, and rents go anywhere from $600 to $1,000/month and typically come with a 1-year lease. Then food on top of that, hopefully you don’t need to feed a 250 pound football player!!

Rachel lives in a 4-bedroom place in Kingston that is $625/month. It’s a bit annoying to pay when she is not living there! Leah is moving to a house next year and that cost will be higher in London – we are planning for another $800/month.

TUITION

This can vary depending on the program and institution. Here are some sample costs:

Sources:

https://www.uvic.ca/undergraduate/finances/tuition-costs/index.php

https://students.ubc.ca/enrolment/finances/tuition-fees

https://www.tru.ca/future/tuition/details.html

https://www.queensu.ca/registrar/tuition-fees

https://registrar.uwo.ca/student_finances/fees_refunds/fee_refund_schedules.html

The costs were higher than when I was a student, they will vary a lot depending on the faculty as well as whether the child lives at home or on/near campus.

Let me know if you have any questio ns.

November Stock Market Update

Mon, 21 Nov 2022 19:59:56 GMT

Stock Market Update November 2022

On the heels of a huge month for stocks in October with major global equity indices returning mid to high single digits (with the exception of Asia and emerging markets) November has had some positive returns as well. Last week the S&P 500 had its best week since June and the NASDAQ had its best week since March.

Sparking much of the rally was news that inflation has likely peaked and is finally slowing.

Why does inflation peaking matter?

Well, if inflation does start to slow, then it opens the door for the US Federal Reserve and Bank of Canada to eventually stop their interest rate increases. They have increased interest rates significantly in a short time period and it does take time to feel the impact so they could back off further increases.

At this point, there are still a few more expected interest rate increases. As of last week, the markets have priced in a 100% chance of a 0.5% increase in December, 100% chance of a 0.25% increase in February, and 75% chance of a 0.25% increase in March, with no expectations of rate increases afterwards for the US Federal reserve.

Source: Manulife Investment Management

The other concern is whether or not the economy will go into recession and how severe it will be. The current thoughts are yes it will but because unemployment is so low, it should be a shallow recession. We all have to wait and see

At the same time the stock market is forward looking it has priced in a lot of ‘future’ bad news. Should we get any more good news on inflation, the war in Ukraine, or the economy, the rally could have plenty of legs left.

Manulife Investments believes that we’re getting much closer to the pause for interest rate increases and believe bonds/fixed income remains attractive for investing, especially in investment-grade quality bonds. For stocks, there may be more downside from these levels; trying to time the bottom of this market will likely lead to disappointment.

In this type of environment, dollar-cost averaging could be a potential strategy, and the strategy over the coming months is to prepare for the likelihood of a strong 2023.

The lower inflation number acts as a Pressure Release Valve

The softer-than-expected core inflation report was the catalyst for the S&P 500 Index gaining 5.5% on the day the inflation report was released, marking its best day since April 2020. The chart below shows some historical perspective for days that saw more than 5% gains. One year later, markets were up 91% of the time, with an average return of almost 28%.

The market’s response shows how much negativity and expected hawkishness from the Fed has been priced in. This report was like a pressure release valve.

We Need Time, and the Inflation Data Bought Us Time

One month does not make a trend, but the October inflation report was still very positive. Several leading indicators have shown decelerating prices.

This report is important for two main reasons:

Firstly, the goods deflation in October offset the upward pressure from strong price increases in services.

Two, it buys time for the Fed. If this was yet another hot inflation increase, that would have put enormous pressure on the Fed to go for a bigger interest rate increase in December. But now it looks like a 50 bps increase is the most likely scenario, assuming the November CPI report doesn’t surprise us by coming in higher than expected.

How close are we to the market bottom?

During economic expansions, recessions, bull markets or bear markets, we’re often asked, “What inning are we in?” The market peak in this cycle happened on January 3 and we’re currently nearly 210 days into the current selloff. Since 1950, the average number of trading days it took from peak to bottom for previous bear markets is approximately 240 days. Using this as a starting point, perhaps we’re three-quarters of the way through this current bear market cycle.

Historically, there are typical indicators that are triggered before the market bottom. The Bank of America U.S. Equity & Quant Strategy team have done great work on these indicators. As of today, there are still indicators that need to be triggered, including unemployment rising vs its 12-month low, a 50-basis-point decline in the two-year yield (vs six-month low), and the yield curve steepening (vs six-month low), to name a few. Trying to time the bottom of this market will likely lead to disappointment. In this type of environment, we believe that dollar-cost averaging could be a potential winning strategy.

Source: Bloomberg, Capital Market Strategy, as of October 31, 2022. Green illustrates average and red illustrates 2022

When markets bottom, what asset class recovers the fastest?

Once markets have bottomed, which equity asset classes have historically outperformed? We looked at the one-year and two-year compound annual growth rate (CAGR) forward returns from the bottom for the S&P 500, Russell 2000, Nasdaq Composite, S&P/TSX Composite, and MSCI AC Asia ex Japan indexes for previous bear-market bottoms since 1990. For reference, there’ve been seven. As the chart below indicates, Nasdaq and Russell 2000 traditionally do better from market bottoms vs their peers.

Market Results at Nov 18, 2022

S&P 500 -16.8%

TSX/S&P -5.9%

Source: Bloomberg, Capital Market Strategy, as of October 31, 2022

October Stock Market Update

Mon, 17 Oct 2022 18:18:45 GMT

Despite the stock market performance year to date, we have a lot to be thankful for.

The past couple of weeks have been interesting. As September was ending, major global indices hit new lows while Treasury yields spiked to levels that we haven’t seen since the Global Financial Crisis of 2008 in reaction to the U.S. Federal Reserve’s continued talk of continuing to increase interest rates through the end of 2022 and into 2023. As October started, we saw a potential “Halloween rally” as global markets rallied between 5% to 7% in a few days.

Here's the latest forecasts from Manulife’s Co Investment Strategist Macan Mia:

Despite the renewed volatility, patient long-term investors can take advantage of the selloffs. While there may be continued short-term volatility and additional downside risk, it’s impossible to time the bottom. We are more positive today than at any time in 2022. We believe there’s a lot more certainty regarding inflation, interest rates, and the health of the global economy.

While in the middle of the storm it’s hard to see that clearer weather is ahead, we believe we’re much closer to the end of this bear market and that patient investors are likely to be rewarded. Remember, the opportunity cost for investors to reach their financial goals is NOT protecting against the potential of another 5% to 10% downside from these levels, but rather missing out on the next bull market that happens after each bear market.

Here is a great video they produced about why we invest in the stock markets. Take a look:

· Why do we invest?

· Time in the markets vs timing the markets – Is there any truth to this investment adage? We look at the data to find the truth—commentary is below.

Time in the markets vs Timing the markets

Everyone has heard it at some time, as it may be one of the most-used investing quotes. It appears to be sound advice, but actually, the data suggests otherwise—historically timing the markets yields superior returns.

Since the Global Financial Crisis, the average return for the S&P 500 Index on a calendar-year basis has been approximately 14%. If you missed the 10 best trading days, your average return was approximately –10%. If you missed the 10 worst trading days, your return would’ve skyrocketed to nearly 52%!

The challenge is that there’s no consistent strategy as to when to get in and out of the markets.

The distribution of worst vs best days makes it hard to execute.

As reported by Bloomberg, in 2020, apart from two data points, the best 10 days (returns between 3.4% to 9.4%) and worst 10 days (–3.5% to –12%) all occurred during March and April and were intermixed. In 2011, apart from one data point, the best and worst 10 days were sandwiched between the months of August and November.

If we had a crystal ball and the time to execute, timing the markets is likely a much better strategy. However, in practice, time in the markets is a more realistic strategy.

If time in the markets allows many investors to meet their financial goals, we shouldn’t get greedy trying to avoid the worst days because, ultimately, we’ll likely also miss the best days.

Source: Manulife Investment Management, Capital Market Strategy. As of September 30, 2022

Global equity, commodity, currency, and yield data

Source: Bloomberg, as of September 30, 2022

September Stock Market Update

Mon, 19 Sep 2022 19:53:27 GMT

Stock Market Update

2022 continues to be a tough year to be an investor.

After a strong start to September, investors were once again reminded that September is often the worst-performing month for markets. Following a worse-than-expected U.S. inflation number for August, the S&P 500 saw its largest one-day drop this year, falling 4.3%.

The U.S. Federal Reserve is now fully expected to increase their benchmark interest rates by 0.75% at their meeting next week. A similar increase is expected over the course of the next two meetings as well, bringing the overnight upper-bound target rate to 4%. The Bank of Canada’s rate is at 3.25% with an expected increase in October of another 0.75% also bringing it to 4%.

While the market reaction was quite strong to the inflation number, it was more so another readjustment—following the strong rally that occurred mid-June. Governments are talking a lot about raising interest rates and the speed and increase has been a surprise. They are very determined to get inflation decreasing and part of that is setting expectations.

The silver lining to this cloud is that we’re likely closer to some clarity on further Fed policy action, and once that happens, markets may turn back to focusing on individual company fundamentals, which could be a positive for individual stocks. Markets could rally with some good news especially when governments stop increasing interest rates.

Looking Forward

According to Manulife Co-Strategist Kevin Headland, they believe:

Above average volatility will likely be with us for some time. A lumpy return profile is likely ahead of us as investors continue to deal with uncertainty and begin to price in the potential for flat to negative earnings growth. So far in 2022, earnings have been better than expected.

Global Macro Environment

There’s little doubt that we’re seeing a slowdown in economic growth around the world. The “R-word,” recession, is being used more frequently to describe the risks in Europe, Asia, and North America. From a global perspective, the Purchasing Managers’ Index (PMI) gives a 30,000-foot view of the global economy.

Recent readings indicate support economic weakness, as many countries have moved into the “neutral area,” with some falling into “red.” The pace of the slowdown could continue if expectations of higher interest rates and runaway inflation remain for the rest of the year and into next.

Further complicating the issues are the extreme weather conditions in certain areas of the world, such as low water levels on the Rhine and the Yangtze Rivers, two extremely important waterways for the local economies and major exporting arteries.

Given the expectation of continued weakness in the PMIs, leading economic indicators, and financial conditions, we believe the U.S. and Canada will experience a mild recession, whereas we see a more severe recession in Europe as a result of the looming energy crisis.

Global purchasing managers’ indices—global activity has weakened going into September:

Source: Bloomberg, Manulife Investment Management, Capital Markets Strategy, as of August 31, 2022

Inflation

For the first 9 months of 2022, we’ve experienced the consequences of policies put into place at the depth of the pandemic. Inflation was also driven higher as a result of the conflict in Ukraine, which led to further energy and food inflation and continued supply chain disruptions with China’s shutting down of Shanghai and Beijing due to strict policies regarding the re-emergence of COVID-19. These factors drove inflation to multi-decade highs globally.

A slowing global economy will likely reduce demand and prices for global commodities. Inflation appears to be peaking and we believe will decelerate going into 2023. For our inflation model, our expectation is that CPI will trend between 4%–5% by year end and 3%–4% by the summer of 2023.

The year 2022 will be remembered for the increase in inflation and its impact on monetary policy and the global economy. In the short term, inflation remains a headwind for markets, but we believe there are catalysts throughout the year that’ll put downward pressure on inflation, and we’re likely to be discussing inflation a lot less next year.

Global Equity Data

Source: Bloomberg, as of August 31, 2022.

Long Term

Remember we have been through this before – there have been 15 bear markets since the 1950’s and after each one is over the markets grow much higher than before. Focus on the long term and stick with companies that run strong businesses, have experienced management teams, continue to execute on their plans and you will see the benefit. Time in the markets matters more than market timing.

Let me know if you have any questions or concerns.

The Fight to Lower Inflation

Mon, 19 Sep 2022 18:02:46 GMT

The Fight to Lower Inflation

The Bank of Canada will probably raise interest rates again in October as inflation continues to add to the stress of the average household in Canada.

The interest rate hikes do take time, but we are hopeful that in the coming months and well into 2023, we will see the higher interest rates begin to bring inflation down.

On the upside GIC rates have increased.

As the rates increase it affects many households and sectors of the economy differently and at different speeds.

We can look at the rapidly cooling housing market where the higher rates have made a huge impact on the cost of borrowing for a mortgage.

According to the Bank of Canada by front loading rate increases now, they are trying to avoid the need for even higher interest rates and a more pronounced slowing of the economy down the road.

There are 3 areas of interest they will be watching:

· Higher interest rates: Are the higher interest rates working to slow demand? When consumer spending moderates and labour demand eases, pressure on prices should decline.

· Global supply disruptions: Are they improving? If so, how fast will this translate into lower cost for Canadian businesses? Note: Unexpected global events may affect the supply and push prices up higher.

· Inflation and Inflation expectations: Are they both coming back down? If yes, short term momentum should indicate how deep-rooted price pressures are.

The Bank of Canada will continue to watch and assess to see if they need to raise the interest rate further noting “We have a careful eye on many different things—we have a lot of work ahead of us, and we will not rest easy until we can get inflation back to target.”

Source: https://www.bankofcanada.ca/2022/09/getting-inflation-back-to-normal/

Retirement: How to Have a Positive Mental Transition

Mon, 19 Sep 2022 18:01:56 GMT

Retirement: How to have a Positive Mental Transition

Once clients are feeling confident that they will have enough money to retire, the next question many of them have is what are they going to do? And what does it mean when they are no longer working?

Just like the transition to being an empty nester can be challenging (me!), the change of working to not can be difficult especially in the beginning. One day you are busy working with colleagues and have a defined role. Then suddenly you go to days spent unemployed with no set responsibilities and no schedule. As we wrote in a previous article there are different phases of retirement - read here if you missed it.

Even if you have your finances all lined up, there's much more to retirement (think your time, talents, & energy) that also need to be considered and planned for and the uncertainty can be stressful.

A good example of this is tennis star Serena Williams. She recently announced her retirement from tennis and had this to say "There is no happiness in this topic for me … I hate it."

She goes on to say, "I know that a lot of people are excited about and look forward to retiring, and I really wish I felt that way."

She has a net worth of $250 million, married to a wealthy tech founder, just retired from a professional sports career and she is not happy about retiring. So, the absence of happiness isn't about money. You can check out the article here.

The thought of potentially facing the next 15-20 years, with no life task or passion to keep you focused or bring joy can be very daunting and include:

Retirement Anxiety

Uneasiness can creep up as you get closer to your retirement.

Loss of Identity

People often place a lot of value on their position as a ‘lawyer’ or ‘account executive’; that is how they identify themselves. When that is gone, who are you?

Losing a Sense of One’s Personal Value.

Now that your career has ended you may feel that you as an individual have lost value. This simply isn’t true. You can put all those skills and talents you have honed over the years to good use.

Boredom:

A common problem with new retirees is boredom especially those use to a busy schedule. Making short- and long-term plans is the best way to deal with this.

So, what can you do to deal with these concerns?

Talking and planning helps as well as recognizing that it is a big life transition so there will be times of stress and that there is much more to your identity.

To have fulfillment in retirement it may help to:

Focus on new interests or hobbies now that you have the time.

Routine: establishing a new routine - no longer being tied to a schedule can be a little bewildering at first but refocusing on new interests is the key to coping with the loss of old routines, establishing new ones and creating a new sense of purpose.

Job satisfaction: If this was important to you perhaps trying volunteer work, developing hobbies or taking self-improvement courses, or consider starting a small business are a few ways to realize job satisfaction.

Achievement: The years spent working for promotions, paying off the mortgage and raising a family were often seen as achievements. In retirement you can make a difference through volunteering through a non-profit, learning a new language or taking painting lessons. This can be set as new life goals and as a bonus, make new social connections.

Short term planning means focusing on the day-to-day activities. Keeping an updated list of to dos, people to see, places to visit and or trying a new recipe is a great way to keep boredom from setting in.

Long term planning is focusing on an objective and researching how to get there. Before taking a leap into a new business venture make sure you have thoroughly investigated/researched and asked questions on how you can achieve maximum success. Give yourself a realistic timeline to meet this objective.

With your values you can use them in a different way however you choose.

To feel useful in retirement, keep busy.

Offer some tutoring, or child minding for your grandchildren, coach a little league team or volunteer. The opportunities in which you can be of value to your community are endless.

Retirement can be the best time of your life. Or perhaps a big disappointment. It is up to you how you want to live it. By preparing long before retirement you will be able to better navigate when you reach it and enjoy the journey.

August Stock Market Update

Wed, 17 Aug 2022 03:53:09 GMT

This summer has been a lot better for markets – the question is this the start of another bull market, or a rally during a bear market? Only time will tell.

Here are the latest predictions by Manulife’s Chief investment Strategists :

Not all bear markets are equal—there are big bears and baby bears, and market performance can vary widely for each type.

A bear market is defined as a decline of 20% or more from the most recent peak. As of the time of writing, we’re in or near a bear market in many equity markets around the world. In the U.S., there’ve been 15 bear markets for the S&P 500 Index since the 1950s. For our discussion purposes, we‘ve included drawdowns of 19% or more as bear markets and have classified them into two buckets: big bears and baby bears . A baby bear means a bear market outside of a recession, while a big bear is a bear market that occurs in a recessionary environment.

For the 15 bear markets since 1950, eight classify as big bears, while seven of them classify as baby bears. The baby bears have been more gentle to investors, with an average selloff of approximately 23%. Investors’ experience with big bears hasn’t been as kind, with the average selloff of approximately 37%

Should we get a recession, our expectation is that it’ll be mild, supported by a solid employment environment and stable U.S. consumer. We believe the odds of a deep recession over the next 12 months remain low, and we’re unlikely to witness an environment similar to the great financial crisis (GDP decline of 5.1% and market drop of 57%); the 1973–1974 recession (GDP decline of 3.2% and a market drop of 48%); or the dot-com crash, where although we experienced only a mild recession, it was a result of an unprecedented tech bubble crash and the September 11 terrorist attacks (the S&P 500 dropped 49%). If we remove these three instances, the average 37% selloff of a big bear falls to 28%. If we’re correct, it would seem that the market has already priced in much of the downside risk.

History suggests that the first half performance that we’ve experienced this year may be unlikely to be replicated in the second half of the year.

Since 1960, there were only two years (1962 and 1970) where the first half (H1) of the year saw a decline greater than 20% in the S&P 500 Index. Returns in the second half (H2) for those periods were 15% and 27%, respectively.

In 21 of 62 first halves of the year (~34% of the time) since 1960, the returns were negative and the average return in H2 was 2%. If you remove the returns from the 1973–1974 recession, the dot-com crash, and the great financial crisis of 2008, the average return for the second half of the year was approximately 8.5%.

We believe the odds of a deep recession over the next 12 months remain low. If we’re proven correct, the second half of 2022 should be much brighter than the first for equity investors .

FHSA

Wed, 17 Aug 2022 03:22:22 GMT

FHSA: Tax Free First Home Savings Plan

Coming 2023

Many of our clients have children who are hoping to buy their first home in the next few years. The federal government has set up a new savings account which will help. In April the Tax Free First Home Savings account (FHSA) was announced, which will be a new registered account to help individuals save to purchase a new home.

To be able to open a FHSA:

You must be 18 years of age or older and a resident of Canada
Cannot have lived in a home you have owned the year you open the account or during the previous four calendar years
Like a RRSP contributions to the FHSA are tax-deductible
You can only participate once in your lifetime to purchase a single property
Once a nontaxable withdrawal is made towards to the purchase of a new home the FHSA must be closed within one year from the first withdrawal
There is an annual contribution limit of $8,000 with a lifetime contribution limit of $40,000
The unused annual contribution cannot be carried forward like the TFSA
You may hold more than one FHSA, but the contribution limits are the same above no matter how many you hold
You may transfer the funds from the FHSA to a RRSP on a tax deferred basis meaning you will pay tax when you begin withdrawing from your RRSP.
Once you open a FHSA you must use the funds within 15 years to purchase a new home or transfer the funds to a RRSP or RRIF, or withdrawn and taxed
You are allowed to transfer from an existing RRSP subject to the limits above. Note: the transfer from the RRSP does not restore the contribution room with respect to the amount transferred. Note: This is because you already received the tax benefit when you added to your RRSP previously
The Home Buyer’s Plan Allows which allows up to $35,000 to be withdrawn from an RRSP (and must be repaid within 15 years) for a purchase of a home will remain in effect.

More information will be coming and expect some changes to the above as they work through the rules.

Source: https://www.moneysense.ca/spend/real-estate/first-home-savings-account/

The 5 Stages of Retirement

Thu, 21 Jul 2022 19:22:03 GMT

After years of working planning for retirement can be exciting as well as stressful. There are many things to consider, which is the same for any transition in life. No one will have the same retirement experience, but most people will feel a mix of excitement and nervousness. The feelings usually come in stages which may include:

Stage 1: Planning

Some start this early and others later, but we all plan for the day we can walk out the workplace and never look back. This takes time thinking about when you want to retire, how much money you need, where you want to live etc. It’s important to prepare yourself emotionally for this big change and to retire when you are ready if you can. By understanding the emotions that come with retiring you will be able to transition from one stage to the next more easily.

Stage 2: Excitement

Once retirement gets closer you’ll start to become more excited. It may be that the thought of not having to get up and go to work Monday morning seems like a dream. And as anticipation builds some will also experience uncertainty. Who am I outside of my work? How will I spend my time?

3: The Honeymoon

This stage is common during many life transitions and of course in retirement too. In the beginning many of your days will be just figuring out what to do with yourself. Learn a new hobby, travel to some exotic local, visit your new grandchild halfway across the country. There is no end to the possibilities. This is also a time to relax and enjoy.

Unfortunately, this stage does not last forever and even though you have worked hard for many years to get to here, eventually you may yearn for something deeper.

Stage 4: Disenchantment

At this point, retirement may not seem as fun and exciting as you thought it would be. After trying new hobbies and lots of trips, disenchantment sets in. For some depression and feelings of emptiness become part of their everyday lives. It is important to talk to someone and ask for help if you need it.

Perhaps just talking with family and friends may be all you need to find a sense of purpose again. Volunteering at a local organization, learning, or a more meaningful activity may help.

Stage 5: Reorientation and Stability

The final stage of retirement emotions is reorientation and stability. This is when you go back to your original retirement plan and reevaluate your goals and hopes you had for retirement. After the honeymoon stage is over and reality sets in, you can make some changes and begin to embrace this part of your life. It is all about balance. Doing the exciting experiences as well as the meaningful. Ask yourself some questions:

What do I still wish to accomplish? How can I achieve this? What makes me fulfilled?

As you begin to settle into retirement you will see the bigger picture and accept the stability that comes with it. Enjoy!

Fidelity Retirement Survey

Thu, 21 Jul 2022 00:30:14 GMT

We have come to the end of the 2021 Fidelity Retirement Survey results.

The message is clear: Most Canadians feel better prepared for retirement with an advisor's guidance, especially during the last few years.

1. Trusted financial advice helps Canadians feel better prepared for retirement

2. Financial advice offers enduring value during uncertain times

Market Update: Reason For Optimism

Thu, 21 Jul 2022 00:30:11 GMT

It’s been a difficult first half to the year, with stocks, bonds, precious metals and cryptocurrencies all suffering losses. Markets are dealing with issues like the COVID reopening, inflation, interest rate increases, the Russia-Ukraine invasion, and recession risk and there may be challenges ahead in the

near term.

The 5 charts below provide some reasons for optimism in the long term. As you have seen, this has been an extraordinary decline for markets. Extraordinary declines reset stock prices from “historically expensive” to “historically fair” which is healthier in the long run. Extraordinary declines are usually followed by stronger returns in the following five years. Here are some charts from JP Morgan in the US (and the data in Canada is similar) that present an optimistic viewpoint moving forward:

Consumer Sentiment

Consumer sentiment is an economic indicator that measures how optimistic consumers feel about their finances and the state of the economy. The current numbers are lower than during the Great Recession in 2008. The average 12-month stock market return from these sentiment bottoms is +24.9%. When consumer sentiment is high the average 12 month return is only 4.1%. That is why Warren Buffet has said it is wise for investors to be “fearful when others are greedy, and greedy when others are fearful".

Consumer Savings

American’s have over $2 Trillion of excess personal savings from COVID that remains unspent. And 70% of US GDP is from consumer spending.

S&P 500 Valuation Measures

US Stocks dropped over 20% in the first half of 2022 as investors worried about inflation, interest rate increases and recession risks. This market correction has lowered the price to earnings ratio to 15.94x earnings, which is lower than the 25-year average of 16.85x earnings. This means that stock valuations are fair but are not considered “cheap”. This should set up investors for better returns in the long run, particularly if today’s stressful environment is eventually replaced by one of slow growth, low inflation and interest rates and high profitability reminiscent of the last decade.

Fixed Income / Bonds

Bonds have gone through one of the worst periods in history. This shows the bond market lows in the past 46 years as well as the end result which has been positive for 42 of those years.

The Worst S&P 500 Quarterly Returns

Here, we see the S&P 500’s return history in various time periods following the worst quarters since 1926. The average annual return increases dramatically as time passes from these poor quarterly results. Over a long-term time horizon, your investment performance will mainly be derived from how you handle corrections, bear markets and market crashes.

We will leave you with some guidance from a TD Wealth Insights Report:

There’s no denying the current challenges, which are reflective of a late phase in the economic cycle. It’s going to remain challenging as economic growth slows and we move through this regime shift of rising rates. It’s important to always remember that the equity market is a discounting mechanism; current prices reflect expectations in the future, and expectations are for slowing growth.

Market volatility creates opportunities, but this is also a time to be selective and diligent. With that in mind, we remain focused on defensive positioning, value and quality companies that generate strong free cash flow and can grow earnings and dividends. In this environment, fundamentals and proper risk-factor diversification are especially important. While the current risk-off environment feels terrible, they have also brought the price of companies with strong attributes down to very attractive levels.

Remember, as an equity investor, you are an owner of businesses that will continue to sell their products, generate cash flow and pay dividends. We will continue to take a patient approach, focusing on compelling value ideas that offer attractive opportunities.

Thank you for your continued support, and please contact us if we can be of any assistance.

Sources: JP Morgan, TD Asset Management

TFSA Beneficiary Rules

Thu, 21 Jul 2022 00:29:55 GMT

What is the difference between a successor annuitant and a beneficiary?

When opening a TFSA and you plan to leave it to your spouse when you pass away what is the better option:

Naming your spouse as a successor annuitant?
Naming your spouse as a beneficiary?

TFSA’s may be federally regulated but they are subject to provincial legislation as well. Most provinces allow for both a successor annuitant and a beneficiary.

What are the two main differences?

Naming your spouse as a successor annuitant: Should you pass away, and you have named your spouse as the successor annuitant they will become the new 'holder' and the tax-exempt status of the TFSA remains intact. This does not affect the TFSA contribution room of the spouse.

The Income Tax Act only allows the tax-exempt status of the TFSA to be passed onto the spouse or common law partner who is the successor annuitant. The surviving spouse can hold the two TFSA accounts or consolidate them into one if they wish. This also means they will bypass probate fees since the TFSA will be passed onto the spouse and not be included their estate.

2. Naming your spouse as a beneficiary: The TFSA will still pass to the spouse on a tax-exempt basis but there are differences and more paperwork:

The transfer must be completed within the rollover period ie. beginning on the day of death and ends on December 31st of the following year.
Transfers done during the rollover period may be deemed to be exempt contributions and do not affect your TFSA contribution room.
Exempt contributions cannot exceed the fair market value of the deceased’s TFSA on the date of death meaning any TFSA growth after the date of death will be taxable.
To declare an exempt contribution you will need to fill out a Designation of Tax- Free Savings Account (RC240 form) within 30 days of the contribution from your deceased spouse and send to the CRA.
This must be done within 30 days of the contribution to ensure that the deceased spouse’s TFSA does not affect your own TFSA contribution room.

The best strategy when it comes to transferring your TFSA to your spouse is designating them as a successor annuitant and having backup beneficiary/beneficiaries if your province allows. This will provide for a seamless transition of your TFSA assets to your spouse at your time of death.

If you and your spouse should die at the same time your beneficiary/beneficiaries will receive the funds outside of your estate bypassing probate fees and precious time.

Source: https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/tax-free-savings-account/death-a-tfsa-holder.html

The 2021 Fidelity Retirement Report

Thu, 21 Apr 2022 00:14:52 GMT

What is in your investment portfolio? Thinking of working in retirement? Find out what the 2021 Fidelity Retirement Report survey results are.

Source: Fidelity Investments 2022

Market Update April 2022

Thu, 21 Apr 2022 00:07:40 GMT

It’s been a challenging year so far for investors. There hasn’t been just one theme that has contributed to the weak performance to start the year but many. At the start of 2022, the conversations were around ‘what is the pace in which global central banks’ would increase interest rates. This has transitioned into the impact of the Russia-Ukraine war and now has moved on to ‘whether the odds of a recession have increased.’

As well as continued concerns about inflation and still some supply chain issues. All of the uncertainty contributes to volatility.

How did stocks do this quarter?

The S&P 500 (US market) ended the quarter at -4.9% although at one point was down -12.5%. The MSCI Europe and MSCI EAFE (Europe, Asia, Far East) also struggled, with returns of -5.9% and -6.6% respectively.

The Canadian market (S&P/TSX) fared better, ending with a gain of 3.1% mainly on the back of stronger oil and commodity prices.

Bonds are also struggling as they are tied to interest rates. But they are good to hold for diversification and protection.

Here is some commentary from Manulife’s chief Investment team:

As the year progresses, we continue to believe that the Fed will raise interest rates less than the 6,7,8 times that’s currently being priced in and that Russia-Ukraine tensions will eventually ease, leading to a pivot in the negative narrative that has unfolded since the start of the year. Over the next few months, the geopolitical premium built into oil prices today will likely begin to decline, but supply-and-demand dynamics will continue to support oil prices above US$90 a barrel as global economies continue to fully reopen leading into the summer and production remains limited.

A change toward a less hawkish sentiment coupled with a good (although weaker) fundamental backdrop provides a positive path forward for equity returns. The key to success in investing is to stay focused on what matters and understand the environment so that you can adjust to the changes if necessary.

With regard to a recession, economic growth forecasts have been revising lowered but are still expected to be 4% growth over the next year. Dynamic’s chief Investment Strategist Myles Zylock doesn’t see imminent risk in the next 12 to 18 months. His comments include that there is a movement towards more quality companies i.e. those with continued profitability, reliability of their cash flows, and a strong balance sheet i.e. more assets than debt.

Historically the impact of war on equities is temporary. Investing is a long game, so best to stay the course and remain diversified. You win by preparing and not reacting.

Please let me know if you’d like to talk further.

Source: https://www.manulifeim.com

What Happens To Your Assets (Estate) if You die Without a Will In BC?

Fri, 15 Apr 2022 00:02:56 GMT

Part 1

What happens to your assets (estate) if you die without a will in BC?

“I know and I will get around to it”. That is a common phrase I hear from many of our clients about getting their will done. About ½ of Canadians have wills and ½ don’t (or have out-of-date wills). With that in mind, I thought this information would be valuable.

There are some assets that aren’t covered by someone’s will. These include life insurance or registered accounts i.e. RRSPs, and RRIFs that have a beneficiary. As well as assets that are jointly owned ie. bank accounts, real estate, or investment accounts.

Everything else would be governed by your will, so if you don’t have one what happens and who decides? We will discuss what happens to your assets.

Your will provides the instructions for how your assets/ estate should be administered and divided among your beneficiaries.

When you die without a will in BC, you are said to have died ‘Intestate’. Without a will and no clear directions on how the estate should be divided intestacy laws are applied using the Wills, Estate and Succession Act or WESA which are:

If the deceased leaves a spouse and no children or descendants, the spouse receives the entire estate.
If the deceased leaves a spouse and children (all of whom are children of the spouse), the spouse receives the first $300,000 and half of the remaining estate. The other half of the remaining estate is divided among the children.
If the deceased leaves a spouse and children, some of whom are not the children of the spouse, the spouse receives the first $150,000 and half of the remaining estate which is then divided among the children.
Surviving spouses do not automatically have an interest in the spousal home. Rather they have the option to buy the home.
If the deceased leaves no spouse, then the estate is divided among the children equally.
If the deceased had no spouse or children then the estate is passed onto the other family members such as parents, siblings, aunts, uncles, etc.
If no one qualifies to receive the estate under the rules, the estate goes to the government.
Looking at the above options are you comfortable with those that pertain to you?

In the next newsletter, we will discuss the role of the executor and what happens if you don’t have one.

Please consult with a lawyer if you have questions about intestate estates or having a will done.

Source: www.jlc.ca