Tuesday, January 29, 2013

The Value of Advice

Still not sure if you need a Financial Advisor?  Advisors provide a wide range of valuable services to clients,  including the planning and maintenance of targets and helping them to choose the right vehicles and the right asset mix to achieve those targets.

Not convinced that there is enough value in working with a professional advisor?  In a study of over 1,000 Canadian households, Ipsos Reid findings show that advised households have substantially higher investable assets than non-advised households.

For example, advised households with income levels between $35,000 and $55,000 had nearly 5 times the level of investable assets compared to non-advised households. Further, these observations are consistent across all income levels and age groups.  How is that for convincing?

 These results show that good advice adds value.  Talk to a professional advisor to see how they can make a difference in your life.

Monday, January 14, 2013

Why All Investors Need an Advisor

If you were a doctor, would you perform surgery on yourself?  What is it they say about lawyers who represent themselves in court ... They have a fool for a client.

There are good reasons that professionals such as doctors and lawyers hire other doctors and lawyers to handle their personal matters, and the same goes with investing.

Larry Light, a contributor to Forbes.com, recently reviewed some of the reasons why anyone who invests needs a professional financial advisor ... primarily Expertise, Objectivity, Discipline and Time Saved.

The truth is, in terms of advice, there is nothing a professional advisor provides that a normal, intelligent person couldn't research and do themselves.  In reality however, how many of us can be objective enough about our own situations and past decisions to make some of the tough decisions that may be necessary?

Anyone can research and keep on top of changing interest rates, global markets and changing legislation, but with work and personal responsibilities taking priority, who has time to do that on an ongoing basis?  That's what a professional advisor does ... takes the time to understand how these various subjects may affect you and help pull everything together. Their purpose is to analyze, explain, advise and help solve financial problems.

Or as Larry says, "You’re working like a galley slave to make ends meet. Do you have the breathing room to research what alternatives are available and then to build a better financial structure to take care of your family?

Likely not. That’s where an advisor comes in."

Source: Forbes.com

Wednesday, January 9, 2013

Does making your annual RRSP contribution leave you feeling uneasy?

The Bank of Montreal recently released a study which found that almost half of respondents to the survey -- 49 per cent -- who make an annual RRSP contribution, do so in a lump sum.

The uneasiness around the March 1 deadline is understandable when Canadians have to deal with other financial priorities, said Marlena Pospiech, senior manager BMO Wealth Planning Group.  "If they haven't saved regularly it could be really hard, especially coming out of the holiday season and if they have racked up a lot of debt over that time."

While it is important to save for your financial goals, it doesn't need to be stressful.  Monthly contribution plans can take the stress out of trying to come up with lump-sum contribution, and even if you find that you can't put aside as much as you would have liked, contribute something.  Something truly is better than nothing when you consider the tax-deferred compound growth that will make your money work harder for you.

Another option may be an RRSP loan.  While borrowing to invest isn't for everyone, it can be a great option for those who want take advantage of unused RRSP contribution room.

There are many RRSP strategies that can work for you – the right ones, incorporated into your overall financial plan, will help you save on taxes every year, retire with more and enhance your estate. Talk to your professional advisor about what’s best for you.

Source: CP24.com

Wednesday, January 2, 2013

2013 recipe for financial success

2012 is behind us and a new year underway.  For many, this is the time to resolve to make changes for the better in the coming year.  Since your overall quality of life is directly related to the overall quality of your finances, getting your financial life in order should be near the top of your list.  Here are ten essential financial planning tips to make that resolution a 2013 reality.
  1. Set a budget and stick to it - Take a critical look at your income and expenses and set a realistic monthly budget that includes an amount for saving and investing.
  2. Get your debt under control and keep it there - Develop good spending habits and use debt wisely. Always pay off credit cards and other high-cost, non-tax deductible debt first.
  3. Maximize RRSP contributions - Investing in RRSP eligible investments is the best tax-sheltered savings builder for most Canadians. Strive to make maximum contributions for faster and bigger potential investment growth.
  4. Develop an education savings plan for your children - A tax-sheltered, compound-growth Registered Education Savings Plan (RESP) eligible investments is an excellent way to cover escalating education costs and give your kids a head start on life.
  5. Be a prudent money manager - Carefully consider each dollar before it’s gone. Start with a careful and critical assessment of your life goals and your income and set aside enough on a regular basis to achieve those goals.
  6. Check and revise your insurance coverage to match changing needs - As your life changes your need for income protection and estate planning changes. Be sure your insurance coverage keeps pace.
  7. Make ‘tax-efficient’ investment decisions - Certain investments are more tax-efficient than others. For example, interest income is taxed significantly higher than dividends and capital gains – so it’s often better to hold investments that earn dividends and capital gains outside your RRSP eligible investments and interest-earning investments inside it. Take advantage of the Tax-Free Savings Plan (TFSA) eligible investments, which allows investment income to grow and be eventually received on a tax-free basis.
  8. Establish an asset allocation plan that complements your financial planning needs - An effective asset allocation plan delivers a portfolio that includes the right balance of assets from the three asset categories -- cash, fixed income investments and equities -- for steadier long-term growth.
  9. Minimize your taxes - Take advantage of all the tax deductions and tax credits available to you including moving expenses, child-care expense, tuition fees, medical expenses, charitable donations, and safety deposit box charges.
  10. Develop a financial plan and stick to it - A consolidated financial plan – and the common sense and discipline to stick to it – plus the help of a professional advisor will keep you on track to achieving your dreams.