Peace of mind in the pandemic year
Financial planning is all about preparing for the future. That covers a lot of ground, of course, from retirement planning to estate planning. Even in the best of times, it’s prudent to have a solid estate plan in place, so that your estate doesn’t end up in the hands of the government and the courts to divvy up your assets. That never ends happily. So with heightened awareness now about the health risks associated with the potentially deadly COVID-19 virus, it makes sense to make a plan to ensure peace of mind for you and your family. Take a look at what elements of estate planning you have in place, and what you might need to re-visit or set up from scratch.
So here are a few key items to consider when thinking about an estate plan.
Why the urgent need for “safety” can lead investors astray
These days, we’re reading a lot about the “flight to safety” in markets and investments. It’s understandable, of course, as the COVID-19 virus pandemic spreads fear and panic through global financial markets as a nasty side effect. But is that flight to safety the right thing to do right now?
Robyn Thompson is featured in CTV’s “Your Morning” with Anne-Marie Mediwake, discussing how to handle your investments and personal finances in the wake of the COVID-19 pandemic scare.
With stock markets now into bear market territory, a global recession looming, and mob-mentality behavior prevailing in both supermarkets and stock markets, Robyn has some timely advice for investors on how to stay calm, weather the market turmoil, and even profit from new opportunities.
Stock market rout not the time for wholesale portfolio changes
The rapid spread of the Covid-19 virus (also known as the coronavirus), has hit global markets hard over the past few weeks as investors worry about the impact of the spreading contagion on global trade and corporate earnings. Stock market indexes have plunged well into correction territory (down more than 10% from recent highs), crude oil has dropped to levels last seen in 2017, global growth appears to be slowing, and with a possible recession looming, central banks are cutting interest rate cuts.
Robyn Thompson is featured in The Globe and Mail’s “Financial Facelift” series by Diane Maley. READ MORE
Escape the shackles of the savings account trap
You may as well face facts: You can’t “save” a million dollars. A recent survey of the market showed that the highest rate paid in a standard, plain-vanilla deposit savings account (the kind that most banks and large financial institutions offer as a place to put your cash) was around 2.8%, while the lowest was, believe it or not, one tenth of 1%. Believe me, with this kind of return, you will not be able to “save” a million dollars. But another fact is that you can still retire rich, possibly with much more than a million dollars in your nest egg, once you unshackle yourself from the savings account trap. Here’s how.
Cents and sensibility
Valentine’s Day can be gushingly romantic, stressful, and exciting all at the same time. For many couples, it can often lead to proposals of marriage or other forms of co-habitation. If you find yourself in that happy situation, congratulations! But before things get too far advanced, it might be an idea to sit down with your significant other and talk about your financial future, too. When I meet with young (or older) couples getting ready to tie the knot, I offer these key financial planning principles to help them get off on the right foot financially. READ MORE
Powerful tax-deferred retirement savings plan
Registered Retirement Savings Plans (RRSPs) are still the best retirement saving and tax-deferral opportunity available for most Canadians. Trouble is, many of us just don’t use RRSPs to their full advantage. Unused RRSP “contribution room” – that is, the amount of eligible RRSP contributions that have not been made – is currently over a trillion dollars. That’s a lot of contribution money that isn’t being tax-sheltered, and that is not giving anyone a tax deduction either. READ MORE
Do you have too many “cooks in the kitchen”?
When most new clients come to see me, they may already have several “advisors” but no clear understanding of what they are actually getting advice on. They might have a financial planner from their bank, and perhaps an insurance agent who also happens to sell mutual funds but doesn’t do financial planning. There might be a bookkeeper who dabbles in investments “on the side.” Perhaps a lawyer. This is a fairly common planning mistake. I call it “Too Many Cooks in the Kitchen.” In order to be effective at organizing your financial life, saving, and investing to meet your goals, you need to have one primary investment advisor who can look at the big picture objectively and head off the “conflicting advice syndrome.” READ MORE
Time to pay the post-secondary piper
Around about this time of year, the great Canadian university hunt gets into full swing. Universities make the rounds at high schools and fairs, looking to entice students to their schools. Students and parents make the rounds, check the programs, visit the universities, and make their applications. In the fall, the kids go off to college. And the tuition bills come in. That’s when it’s time to start making withdrawals from Registered Education Savings Plans (if you had the foresight to set them up, say, 15 years ago!) The rules for RESP withdrawals are fairly simple, but there are a few wrinkles to be aware of. READ MORE