RRSP Season is Over…Now What?
Posted on March 3, 2010 at 5:27 pm
Filed Under Financial Planning, Investment Planning, Mutual Funds | Leave a comment
As many Canadians have become used too, the March 1st deadline is officially come and gone.
The primary question many of our clients are asking us is “What’s the best way to use my available cash flow now that my RRSP is maxed out for the year?” One of the most obvious and natural answers is to take full advantage of the Tax Free Savings Account that the Government “gifted” us on January 1st, 2009.
If you haven’t used up your room entirely (you have contribution room of $5,000 from 2009 and $5,000 for 2010), then we suggest a simple yet effective monthly investment. If you break down the $5,000 available per year, that works out to approximately $416 per month.
The real beauty of the TFSA is the fact that your money is always 100% liquid and accessible at any point, and you never pay taxes on withdrawal, regardless of how much you’ve grown your account.
You’re Take Away: Simply put, you won’t lose if you take whatever cash flow you have available and begin to invest that in a TFSA every month. However, it amazes us how many of us don’t realize that you can invest in stocks, mutual funds, high interest savings accounts and many other investment vehicles much like your RRSP. Depending on your risk profile, time line and realistic expectations, it is highly possible that you should and will want to look at investment choices that have the potential to earn you a larger return then your basic bank is promoting.
After all, if you do happen to hold on to this investment without accessing it for a few years, your growth could be substantial and be withdrawn completely tax free. That, and you can always use your TFSA account to transfer money to your RRSP during next year’s RRSP season if you’re running low on cash at the time.
Until next week, have a wonderful Wednesday!
Chris and Elisseos
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SAFEBRIDGE is Hiring a Manager of Client Care! Interested?!?
Posted on November 16, 2009 at 6:15 pm
Filed Under SAFEBRIDGE News | Leave a comment
Job Description - Manager of Client Care
Our team is looking for a new Manager of Client Care who could start as early as November 30th, 2009.
Anyone interested or know someone who is looking to fill a great role in a fast paced team environment focusing on the Underwriting and Administration of mortgage, insurance and investment products? We are hoping to find someone with financial services experience and as importantly, a very positive and vibrant personality. Our original Title for this role was “Director of First Impressions” but it was a little long for business cards…lol. At least you can understand how important this person is to our team though!
See the attached Job Description if your interested and feel free to contact me for more information.
Until next time, have a Magnificent Monday!
Chris and Elisseos
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How Will The H1N1 Virus Affect Your Life Insurance
Posted on November 5, 2009 at 5:42 pm
Filed Under Financial Planning, Insurance Planning, Personal Insurance | Leave a comment
It is very easy to become caught up with the fear that naturally develops when we hear words like “life threatening”, “breakout”, “pandemic”, or even just the word “virus”. As a result, our team wanted to help you answer the question “How will the H1N1 virus affect my life insurance?”
The Good News
The good news for those that already own life insurance is that it won’t; not even a little bit.
One of the benefits of obtaining life insurance at a young age, or anytime for that matter, is that it’s as though the life insurance company is taking a snap shot of your health at that exact moment. As long as you are honest and truthful with the information you provide, you are forever covered as long as you keep the insurance premiums and policy up to date, regardless if your health status changes in the future.
The Not so Good News
For those who don’t own life insurance at this time, this new breakout could play a substantial role in the possibility of whether you can or will be able to insure yourself in the future, should you be exposed to it.
Just because an insurance company may not ask the direct question like “Have you been diagnosed with the H1N1 virus?” does not mean you don’t have to worry about this new virus. In fact, most insurance companies will ask broad sweeping questions in their application such as:
- Have you consulted any physician within the past five years for anything not covered in the above questions or in this application?
- Are you aware of any symptoms or complaints regarding your health for which you have not yet consulted a physician?
- Have you had any symptoms, illness, injury, surgery, treatment or investigation, or been advised to receive treatment or investigation, or examination not mentioned above?
A simple yes to any of these questions could not only postpone your approval indefinitely, but also raise red flags that as a potential life insurance applicant, you’d rather not face.
Most insurance companies will not accept a new client if they are currently undergoing testing or treatment for any illness within the last six months, H1N1 included. What that means is that if you are exposed or worse, diagnosed with this virus, the insurance company could either rate your request for life insurance, postpone your approval, or flat out decline you for life, depending on the severity of your specific situation.
Your Take-Away: If you are or have been looking to insure yourself or your family for life insurance, disability insurance or critical illness insurance, or may be considering raising your policy, we recommend that you consider doing so sooner rather then later.
Below are a couple of reasons you may want to consider when deciding if now is the time to look into adding to or setting up your insurance program:
1. You have visited a medical facility within the last 3 months and potentially been “exposed”
2. You have a friend, family member or colleague who has actually been diagnosed with H1N1
3. Insurance companies are far more flexible and lenient during the last two months of the year
Until next time, have Terrific Thursday!
Chris and Elisseos
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5 Reasons To Consider Life Insurance
Posted on July 31, 2009 at 2:32 pm
Filed Under Financial Planning, Insurance Planning, Personal Insurance | Leave a comment
Tim Cestnick is a well respected writer and columnist with the Globe and has recently written a great article entitled “Five Reasons to be Nice to Your Insurance Agent”.
Despite the fact that the title of this article comes across as very “Agent Focused”, Tim actually focuses on five great reasons to consider owning life insurance. The five reasons that Tim discusses include:
- Provide for Others
- Cover Final Disbursements
- Provide Equitable or Larger Bequests
- Shelter Income From Tax
- Maintain Business Health
I really enjoyed this article because Tim provides a very “birds eye view” of life insurance and some of it’s core and primary uses overall. The one that really sticks out to me however is point four entitled “Shelter Income From Tax”. After all, we live in a country where we can pay up to 50% of our income back to the Government in the form of taxes, so why wouldn’t we want to explore all of our tax shelter opportunities?
Your Take-Away: Life insurance is a topic that is not easily discussed in general conversation, and rarely ever praised. That said, the basic reason people purchase life insurance is love, and if you’ve ever received a life claim as a result of a loved ones passing, you have likely become a big advocate.
The good news however is that whether you want to purchase life insurance for others or not, it is still very much worth your time and effort to understand how it works and more importantly, how it can save you literally thousands of dollars of tax in a year. Most of us really aren’t aware of these kinds of benefits and how to properly structure life insurance for this purpose, but after looking at the facts and the numbers, you may just find that you’ve piqued your own interest!
Until next time, have a wonderful long weekend!
Chris
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1 Year Fixed vs. a Variable Rate?
Posted on July 23, 2009 at 8:49 pm
Filed Under Mortgage Planning | Leave a comment
With interest rates holding true based on the Bank of Canada’s recent announcement, a question that people are asking is should I consider a one year fixed rate or a variable rate mortgage?
Here are some things to think about:
- Today’s variable-rate mortgages still have higher interest rate premiums relative to those in the past
- A 1-year mortgage doesn’t lock you into a rate for 3-5 years which means you can refinance in 12 months when (hopefully) discounts to prime might be back
- The rates are comparable: Variable and 1-year mortgages are both based on short-term interest rates, so they move together over time
- In some unique cases, rates on 1-year mortgages are better than today’s best variable rates
- The most flexible 1-year mortgages are convertible into a fixed OR variable rate at any time, and at no cost
- 1-years give you a chance to haggle with your lender again in 12 months which may or may not be a positive for you
- If rates go up in the next 12 months, you’re protected for the remainder of the term in a fixed-rate mortgage
- If rates steadily climb over the course of five years, 1-year terms could help you come out further ahead because 1-year rates reset slower than variable rates—which is helpful when rates are rising
- 1-year payments are fixed for a longer period of time than variable payments which makes budgeting easier
Your Take-Away: Any time you are making a decision regarding the term and structure of your mortgage, it is imperative to take into account all of your options along with the pros and cons of each. The truth is, there is no “one size fits all” solution which is why a proper consultation can prove to be so beneficial and necessary.
After all, the only way to truly know which term or structure is best for you is to a number of different variables including your epected time in your existing home, your current cash flow needs and flexibility, your overall goals and objectives in terms of your mortgage, and so on. Don’t think that just because one option may have a better rate then the other that your answer is easy…there is far more to this decision then just looking at the rates.
As always, have a Terrific Thursday!
Chris and Elisseos
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Canadians are Behind on Their Credit Payments
Posted on July 7, 2009 at 12:34 pm
Filed Under Financial Planning | Leave a comment
Equifax Canada recently released information stating that more then half a million Canadians are continuing to fall behind on their credit payments.
In their report, they went on to say “The average delinquency rate for Canada rose by approximately 19% over a one-year span from May 31, 2008 to May 31, 2009…This means that over a half a million Canadians are now more than 90 days behind on their credit payments.”
What’s even scarier to me is that Equifax claims “The sharpest increase has resulted from Credit Card and Sales Finance purchases, which have increased by 38% and 58%, respectively, since May 2008. Such transactions typically represent the purchase of durable goods, such as furniture or electronics, and consumers appear to be willing to fall behind on them first before they miss payments on their Bank Loans and Lines of Credit.”
You’re Take-Away: This information may not be news to you, nor may it make any difference to you if you’re one of those lucky few who are able to live debt free or at least manage your debt payments. The one lesson that stands out to me however is that we need to be learn to manage our cash flow better, for the sake of our financial futures and credit ratings.
After all, the reality is that those falling behind aren’t doing so in terms of their mortgages or lines of credits mainly. In fact, they’re falling behind on payments that have resulted largely from consumer purchases, which I like to call, consumer wants. The financial companies that offer no interest or payments for a year or more are still making money or they wouldn’t offer the program in the first place. Read the fine print. If you miss your payment by a day, they will back charge you for the entire period of time that you haven’t paid anything with interest rates as high as 24% and more.
The long and short, if you’re going to purchase anything using a store issued credit card, make sure to make a note and pay that purchase off at least one week prior to the deadline. If you don’t, you will see your bill jump dramatically and possibly join the Canadians mentioned above in the Equifax report.
Until next time, happy spending and have a Terrific Tuesday!
Chris
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Are Pre-Approvals On Their Way Out?
Posted on June 23, 2009 at 5:20 pm
Filed Under Mortgage Planning, Real Estate | Leave a comment
An intriguing article was recently published online posing the above question.
If you understand how a mortgage pre-approval works, its probably a safe assumption that you understand that the benefit is very much in the favor of the mortgage client rather then the mortgage Lender. After all, in order for a Lender to provide an authentic pre-approval, they have to run through the same administrative process they would for a new mortgage client with a firm commitment. However, with a pre-approval the client always has the option of opting out and walking away from the deal considering there is no penalty or loss to do so.
Recently, one large bank has officially removed themself from the pre-approval market based on the internal costs incurred as a result of providing this service. In reality, less then one third of pre-approvals actually close and in the case of the major lender mentioned above, it is rumored that they had been losing $20 million in business each year before they decided to pull that service from their product shelf.
Your Take-Away: To me it seems clear that a pre-approval is really an attempt by the Lenders of the world to get their feet in the door with potential mortgage clients by offering a service that actually may or may not prove to be of any value to them from a business perspective. If that is in fact true, that implies that you as a potential client hold all the cards.
Many people feel as though they are locked in when they put a pre-approval in place or that it can somehow prove to be detrimental to their search for a mortgage. There are no penalties, nothing locking you in to any one lender, and no drawbacks to getting pre-approved. After all, if there were then the Lenders would be making money, not losing it.
My suggestion, if you are even thinking about moving or refinancing, put a pre-approval in place as soon as possible and lock in the best rate possible for the next 120 days.
Until next time, have a Terrific Tuesday.
Chris
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Susan Boyle on “Britain’s Got Talent”
Posted on April 16, 2009 at 6:29 pm
Filed Under Personal | Leave a comment
Once in a while we see things that remind of us of the little lessons in life we so often forget.
Although this is not at all related to our regular posts on this blog, I felt it necessary to post the link below both out of respect for what Susan accomplished, and also as a reminder that we can’t be too quick to judge. I apologize in advance to anyone who didn’t expect this post on our blog, and I hope you can understand that our blog isn’t about just people’s money, it’s about the people we help with their money. And this video is very much about all of us, as people.
Watch this very short video and be inspired, be awestruck, and be reminded!
Until next time, have a Terrific Thursday!
Chris
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Couple Declined Their Mortgage Insurance Claim - The Toronto Star
Posted on April 9, 2009 at 4:00 pm
Filed Under Financial Planning, Insurance Planning, Mortgage Planning, Personal Insurance | Leave a comment
Third party articles are always of interest to us, and this specific article in the Toronto Star is an eye opener for anyone.
Ellen Roseman of The Toronto Star recently documented one couple’s fight to get paid on a death claim that was made through their TD Canada Trust. We’ve talked about the perils of Mortgage Insurance offered through your lender in posts before, but this story is a real life experience for one Toronto based couple and I’m sure it will make you question where you hold your insurance.
The good news is that despite the original decline of their claim, to TD’s credit they did revisit the situation once the Star became involved and later paid out the claim in full. The reality however is that had they not gone to the Star for help, they may never have received that money. And even if they would have, do you think they really wanted to have to fight for something they knew all along they were entitled too? Never mind the fact that they were also in the midst of dealing with the news of a terminal Cancer diagnosis. Perfet timing it seems?!?
Your Take-Away: The most chilling comment written by Ellen was quite poignant, and one you should seriously considering thinking through. Ellen wrote: “The lesson: Banks can issue insurance and deny coverage years later if they think there was misrepresentation on an application.”
I can’t help but think it may just be time to at least explore your other life insurance options, mainly because the underwriting is done up front, not at claim time. And after all, you’re most likely going to save some money too. Not a bad thing considering the current status of our economy!
Until next time, have a very Happy Easter!
Chris
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Prayer Vigil Tonight at Six Steps for George Koutroubis
Posted on February 20, 2009 at 4:19 pm
Filed Under Uncategorized | Leave a comment
The search continues for our good friend and relative George Koutroubis.
We are hosting a prayer vigil TONIGHT at Six Steps Restaurant at 6:00pm. We are asking anyone to join us at 55 Colborne Street whether you pray or not, whether you know him or not, or whether you simply can be here to support those involved.
I’m calling anyone we know to join us tonight and lift our thoughts and concerns to our God. Please…if you can be here then do just that. It’s time put aside anything other then our friend and relative George Koutroubis and ask that God will provide wisdom, strength and clarity to those involved.
Thank you in advance for your continued prayers and support.
Chris & Elisseos
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