At this time of year, there are an overwhelming number of moving vans on the streets.   From May to July, many people are de-cluttering, packing and getting to Canada Post to change their addresses.

Unfortunately, when refinancing, people usually get suckered, (yes suckered) into purchasing “mortgage insurance”.

Mortgage insurance from the get go is a really bad idea. However, professionals that provide mortgages are required (brokers are mandated) to offer it. In my humble opinion, most do not understand the financially damaging consequences of mortgage insurance or the disservice that they are presenting to their clients. The ones that do understand should provide you with a business card for an independent insurance agent so that you can get proper insurance coverage, inclusive of covering off your mortgage debt.

Don’t believe me? Let the CBC give you more details: “Mortgage insurance: Not always a sure thing” http://www.cbc.ca/marketplace/2008/02/06/in_denial/

Here are my THREE KEY CONCERNS about buying mortgage insurance:

Concern #1: Mortgage insurance does not provide the beneficiary with a choice about how to use the proceeds of the insurance. Their only option is to pay off the balance of the mortgage, regardless as to how much insurance the client thinks they have (see #3). This could leave a family with a paid off house, but no ability to pay for the funeral or buy groceries if its the breadwinner that passes away.
Concern #2: Rarely (if ever), is mortgage insurance underwritten. If you don’t do the basics of providing a blood/urine sample; have your blood pressure taken or verify your height/weight, there is a high probability that your coverage will disappear when you (or your beneficiaries) need it most. Failure to disclose the smallest of details could negate your coverage entirely.
Concern #3: Mortgage insurance generally comes with a static premium for less coverage. For example, if you had a $200,000 mortgage and paid $80 a month for $200,000 coverage, in a few years, when your mortgage was valued at $150,000, you would still be paying $80 a month. However, now you only have $150,000 of coverage, not the original $200,000. You pay more, to get less.
Take a look at the chart on this link to see how obtaining individual insurance compares to mortgage insurance.

http://www.investorssource.ca/services/insurance-protection (Mortgage Insurance: Yikes!)

Call an experienced insurance agent to put a proper insurance plan in place that will:

• eliminate your debts on death;
• pay for your children to attend a post-secondary institution;
• pay funeral expenses;
• pay for potential probate fees; legal and accounting fees to administer your estate;
• provide cash flow to your surviving spouse/partner so they can grieve, recover and re-organize life without you
• provide your business partners with funds to buy out your share of the business

There are a variety of uses of that a properly structured insurance plan will accomplish.

Contact Investors Source to find out how we can help you!

For our blog today, we’re keeping it simple.

If you could obtain a GIC type vehicle that yields between 6 – 7 % guaranteed for the rest of your life… would you investigate it?

We know that you’ve said yes to that question. So here are a few of the benefits that you will find out more about:

• Reduce Your Taxable Income

• Split T5 income

• Guarantee the preservation of your investment principal for life

• Guarantee your income (6-7% average annual cash flow) for life

• Create an estate transition strategy

• Legally Bypass Probate

• Eliminate or reduce Trustee Fees and/or Legal Fees

Call our office to find out how a 30 minute conversation with the right investment product will do all of this for you or for your parents.

We look forward to hearing from you.

TEL : 705-733-3338

Email info@investorssource.ca

We’ve said it before; we believe that GICs are bankruptcy on a plan.  Why?
Because  interest rates are at rock bottom levels, the interest is taxed at the highest possible marginal rate, and frankly, they simply don’t keep up with Canada’s inflation rate.

We know that Canada’s seniors are concerned about their retirement income and therefore are flocking to what they know and feel comfortable with. The unfortunate part is that this is often a national banking institution’s GIC.  In our humble opinion, buying a GIC in today’s market environment is a very bad idea.

If you have GICs, or if you have an elderly parent that utilizes them, Investors Source Wealth Management / Insurance can provide you with a better guaranteed investment and a better tax situation.

We’re so passionate about this that we will give you a tip considering its tax time in Canada.

The main culprit, as we’ve pointed out to several Barrie Accountants, is Box 13 on the T5 slip that is issued by the bank or credit union that an investor puts their savings into.  Any dollar figure listed in Box 13 is highly taxable and the worst part is that it doesn’t allow the senior to take advantage of the Government of Canada’s Tax Fairness Plan.

Here’s the important detail.  Invest in a guaranteed product, get guaranteed income for the rest of your life and move that dollar figure from Box 13 to Box 19.  That shift will now make that income highly tax efficient and it will now qualify under the Tax Fairness Plan.

Tax efficient investing for seniors should be standard, not the exception!

Call Investors Source Wealth Management / Insurance today at 705-733-3338 or email info@investorssource.ca to find out how we can provide you with guarantees and lower your taxable income.

As one elderly gentleman put it: “GICs don’t pay enough. I need to live off the income and I need my sleep.”

It’s amazing how much ineffective money is trapped in Canada’s banks and credit unions and how little GIC investors are getting.

If you do a Google search, these institutions will often state their “competitive posted GIC rate”. In preparation to write this, we checked out one large public well known Canadian bank. We kid you not, one of their products said “Minimum Return is 0.1%”.

Depending on the needs of the individual, there is a considerable amount of detail to consider when providing an individual with investment guarantees. We have to consider their age, the amount of money they wish to secure and the investment return they desire. If the person wants the guarantee tied into an estate transition strategy for the future or if they want the income from the money now and of course we discuss the taxable impact of any decision made.

In fact, properly planning for taxes by using an appropriate investment strategy is the golden ticket. Between the investment markets bouncing around, concerns about the global economy and the Canada Revenue Agency (CRA) finding new ways to collect more tax, investors are seeking stability, guarantees and tax efficient capital growth.

Call 705-733-3338 or email info@investorssource.ca to find out how we can provide you with guarantees and lower your taxable income.

The study found that couples reaching retirement and those in retirement were “struggling with overall communication, planning and management of their retirement finances”. In fact, only 41% of those surveyed confirmed that they handled their investment decisions for retirement savings as a couple. Surprisingly, 58% of the respondents worked with an investment professional, but only 35% worked jointly with that professional

For those of us that work in the investment industry, having couples engaged is a priority. Over the years, we and our colleagues, have heard the horror stories that our clients tell us about family members. The situation is fairly typical.

Upon the death of the decision making, finance controlling spouse, the other appears lost. They don’t know what they have, what their commitments are financially, or what the impact would be by outright canceling investment strategies. It’s often the supposed well-meaning friends and family members who believe that they are coming in to rescue the individual, and are encouraging decisions to be made without the least bit of understanding on the financial impact of those decisions.

In one instance, an insurance representative was training our team. The story he relayed was of a woman who recently lost her spouse. The man had set up an insurance annuity a few years before that was designed to pay out significant amounts of income annually to his wife. The strategy came part and parcel with an insurance policy on the wife. The husband had arranged this secure set up, and ensured that the insurance premiums were paid annually.

After his death, the widow received the annual insurance premium payment notice. It was for a significant sum. Not knowing what it was for, she canceled it after heeding the advice of her children and without consulting with the financial advisor who structured the program for the couple. At her death, there was no inheritance for the children because the balance of the annuity returns to the insurance company. Since the widow canceled the insurance policy without knowing its purpose, she prevented her children from receiving any inheritance.

Clear communication between spouses is important especially leading up to retirement. Surprisingly, the Fidelity survey found that one third of their interviewed American couples didn’t agree on or didn’t know what the dream retirement date was of their spouse. The other two-thirds didn’t agree on their respective retirement ages. In fact, the tables were turned again on the couples when they couldn’t agree if they even had a detailed retirement income plan in place.

Communication must span the generations and keeping adult children in the loop is also very important. In the coming months in our office, our receptionist will be ensuring that our clients complete a basic family tree for our records. We want to ensure that we have the details on file of who the family members are of our clients. In this manner, we can encourage proper inter-generational communication and planning.

Our strategy to bring families together about money and planning is intended to ensure that all parties are up to date on Wills, POA, Probate taxes and the purpose behind why programs are put into place. In this way, clients will have a secure retirement and if it is intended to leave an inheritance, our team will strategize for one.

Take the Fidelity Quiz: https://communications.fidelity.com/couplesquiz/

Properly designed insurance coverage often takes the position of least importance for many Canadian families.  I can never understand this.

For any insurance agent, I would suggest that their ongoing battle has been with people telling us that they don’t believe in insurance, because they have group insurance coverage at work they don’t need it personally, or it’s too costly.

These excuses just get under my skin. Having adequate life insurance coverage is about keeping your beneficiaries provided for after your death. Having health benefit coverage (disability, critical illness and long term care) is about keeping the family unit together while they experience the ultimate in emotional and financial stress of caring for an extremely ill family member. To me, failure to obtain life insurance coverage is nothing more than an act of selfishness.

In today’s economy, employment is not guaranteed. Large or small, companies go bankrupt, are taken over, restructure and have to be nimble to survive. Convincing yourself that you are a “lifer” in the company is a mistake. In our experience, it’s the late 50 year old that gets laid off, and they are the one with the health issues and insurance coverage at that point can be cost prohibitive.

Insurance, in the bigger picture of things isn’t that expensive. Every situation is unique and every individual requires an insurance program set up for them.

Today, $100 will slip through our fingers without us noticing. For example:

On your way to work you stop to get a large coffee and a toasted bagel with cheese 5 days a week. The cost is roughly $3.84 a day. Monthly that is $76.80.

If you have to fill up twice a month, $100 isn’t likely enough to pay for two full tanks.

The average cell phone bill per user tends to come in around the $80 to $90 mark.

Bring a $100 bill to pay for dinner at a chain restaurant, movie tickets for two and a shared combo snack package.

For $100.74 a month, a 40 year old male, non-smoker can have flat insurance costs for 25 years. He will have $750 a month to cover any disabilities, $37,500 for a critical illness and if he didn’t claim on the first two, will have $150,000 coverage on his life.

By the way, for my healthy male……here are the scary stats…..

• 7% chance of dying before age 65
• 34.7% chance of disability before age 65
• 7.8% change of a critical illness before age 65 (being cancer, heart attack or stroke)
• 59.3% of one of the three happening to him before age 65

These statistics are courtesy of Stats Canada critical illness incidence for cancer, heart attack and stroke between 2002 and 2007. The insurance details are courtesy of Manulife Financial.

Still skeptical? The next time your adorable child hops into bed in the morning to give you a “wake up kiss”, think about how their future would be affected if you were no longer there or got sick and couldn’t provide as you had in the past.

Would you be willing to give up or reduce your coffee and bagel habit to ensure your child’s future?

Follow us on Twitter: @investorssource or @isinsure.   Like us on Facebook!

About 5 years ago, my colleague advised me one day about how a relative of hers “John” had had a heart attack

At this point in time, that little creature that was sitting on John’s shoulder promptly exploded.  The little creature could no longer hold up the “It’s Never Going to Happen to Me” flag.

We all have one. A little creature that is, and every single one of them carry that same flag.  We live life invincible, and as my four year old would say “I’m playing superhero”.

John was admitted to the Royal Victoria Hospital in Barrie.  Although a smoker, he was in average health / weight at 46.  Employed full time, his life was massively changed for the next few months and for the future.

Under Doctor’s orders:

• he was off work for 6 months
• was prohibited from driving for 4 months
• had to start a prescription pill regime for life

Let’s discuss the financial impact, no employment income, and medications for this family run between $200 – $300 a month.

It gets worse.

John is now an insurance nightmare.  If he wants to travel, coverage is astronomically priced.  Although John has existing term insurance coverage, upon its expiry, obtaining new coverage may include excessive rating or exclusions for issues related to the heart.

In hindsight, John now wishes that he had obtained Critical Illness insurance coverage, as well as permanent insurance for life. His financial situation and future would have a much brighter outlook.

For me, my husband and I were advised at Christmas time that my 75ish grandfather-in-law, had a stroke and was in the hospital.  When talking with him after, he told me that he had felt the signs, and ignored them.  He survived the stroke, and now on his limited budget, has the great pleasure of taking a cocktail mix of drugs daily.

In the late 1960’s, my mother, at 12 years old was taken to the hospital for back pain.   The doctor came out shortly after and advised my grandmother that they were admitting her daughter, and that she was being prepped for heart surgery.  The surgery, which had only been done for 5 years, was to re-open a valve that was closing in one of her arteries.  My mother still bears the scar today.

I have various family members on blood thinners, blood pressure pills and other pain medications.

Heart and Stoke issues affect us all.  To find out if you’re at risk, go to www.heartandstroke.ca and take the “Risk Assessment Quiz”.  I love the fact that the quiz is sponsored by Desjardins, an insurance company that I’ve worked with to put insurance coverage on my clients.

If you have determined that you are at risk, it’s time to take action.  Visit one of our Insurance Structures to find out how our team of insurance advisors can mitigate the negative financial impact of a future heart attack or stroke so that you can focus on healing.

Follow us on Twitter: @investorssource or @isinsure.   Like us on Facebook!

For every new like on Facebook during the month of February we will donate 1$ to Heart and Stroke!

• Food
• Mortgage
• Utility Costs
• Transportation Expenses
• Fun Spending
• Debt Reduction
• Family Savings
• Insurance Coverage

I find this to be a slightly ironic list because, for someone like me, the top 3 are blatantly incorrect (apologies Mr. Maslow).  My top 3 financial priorities would be in this order:

• Insurance Coverage
• Food
• Mortgage

I want you, my friendly blog reader, to understand why I’ve restructured the list with Insurance Coverage as my first priority.  Why?  Because as a Canadian, I take many things for granted, including my health care.

If I were to get the flu, off I go to a walk in clinic.  If a family member breaks an arm, it’s a quick drive to our local Urgent Care Clinic.  Finally, if someone I know has a heart attack, it’s off to the emergency ward at the local hospital (www.rvh.on.ca).

The question that bears answering is what happens when you don’t get better quickly?

Last time I checked, my municipal, provincial and national government didn’t cut me a cheque to ensure that I could buy food for my family.   If we’re off work for a week sick, no big deal.

But what if you had a heart attack and the Doctor told you that effective immediately, you were off work for a few months in order to recuperate?  You aren’t thinking about the deadline for work, you’re thinking about how you will pay the grocery bill and the mortgage in the coming weeks.

As an insurance company, we have the financial solution to your insurance needs and the Heart & Stroke Foundation has answers to improve your heart health.  February is Heart & Stroke month so visit: www.heartandstroke.com for more information and watch the video: “Death Loves Women”.  As a woman, I’m disturbed watching this.  I relate to the 30ish woman toilet training her toddler, while holding her baby.    Who do you relate to?   Is your mom, sister, child, colleague or friend represented?

These videos are powerful and should motivate all of us to re-evaluate both our health, and our insurance coverage.

Stay tuned for our next blog release coming later this week. We’re getting personal with the Heart & Stroke theme as various team members (primarily me) have family that have been negatively impacted by heart and stroke issues. You won’t cry, but it’ll open your eyes a bit to the realities of how your life will change.

As we were releasing today’s blog, we heard through the social media grapevine that after 1 year of fundraising, the RVH Auxiliary  has raised $750,000 (50% of its $1.5 million pledge) for the coronary care unit!

For you social media gurus out there, Heart & Stroke Foundation can be followed on Twitter: @TheHSF.  I can be found at @isinsure

It’s that time of year again when the general retail investor remembers that they haven’t yet made their annual RSP contribution. Whether your memory is jogged by the mass media, advertisements ran by well known brand name bank, investment or insurance companies, or by the annual phone call from your advisor, many people make last minute decisions on how to invest their retirement assets.

The wisest of decisions often take thought and contemplation. I’ve often compared buying an investment to getting married. For us married people, we didn’t get married without considering the attributes of our spouse-to-be first. We took our time, we courted, we tested, we teased, we fought and made up. We watched their interaction with their family and with children (if having kids was on the criteria list). We listened to how they spoke to others and we considered how considerate that person would be. Then if the “offering” was acceptable, we took the plunge, said I do, and hoped that our lives would turn out “happily ever after”.

When you are making an investment buying decision, you should have a criteria list that you put your advisor or the investment of choice through prior to leaping in. If you invest in mutual funds, segregated funds or GIC’s, you often have to consider the time commitment you are making to that particular investment or to the provider of the investment. People, strangely enough, overlook this.

Not by any means am I or my team “buy, hold and forget about it” investment strategists. We watch what’s happening globally, politically and in the various sectors. We think about what client’s need and desire from their investments, and we consider options to present for discussion. We suggest changes when changes are warranted.

We also take the time to schedule our clients for quarterly performance reviews. We don’t forget that its our responsibility to care for our clients’ financial assets. This is an immense responsibility and one that we do not take lightly.

Recently, an existing client advised us that they were disgruntled with the return they received from their nationally recognized banking institution. A few years prior to working with us, this person invested some savings in their RSP, and now the GIC is free to be moved. After a few years, the client earned about $300 in interest (do you hear the sarcastic “whoopee”). This person is lucky to have the original principal because that $300 has “poof” disappeared once we factor in the tax consequences of interest income and inflation. GICs are not as perfect as advertisers would have you believe. In fact, we jokingly call them “Bankruptcy on a Plan”.

When making an investment decision this RSP season, do your homework. Ask yourself what your priorities are. Here are some questions to ask:

If you are contemplating using a GIC, ask yourself this:

1. What is the time commitment to leave the assets invested?
2. What benefit do I get at the end of that period and how will it be taxed? (in other words will there be anything left over?)
3. Is there any chance that I may need to access that RSP investment ( first time home buyer, going back to school, or fankly I just need the money due to an unfortunate change in mine or my family’s circumstances financially)?

If you are contemplating using a Segregated Fund, ask yourself:

1. Who is the insurance company that my advisor is talking to me about and what are they known for?
2. What are the benefits to the insurance investment, are there bells and whistles and bonuses that I get to stay invested?
3. What is my time commitment? Are there penalties to leave the investment if I need the funds unexpectedly?
4. How does my advisor get paid and does that affect my decision?
5. Is there a broad spectrum of investment funds that I can choose from?
6. What principal, market growth and death benefit guarantees do I get access to?

When you invest this RSP season, spread the love a little. Make sure that you don’t run back to your local bank just because that’s where you’ve always gone. Shocking for many investors, is the day that they don’t get what they expected and they wake up to the realization that banks are a business. They are there to make a profit, end of story.

Take your time, consider your options and speak to the independent financial service people in your local community (like us!). They will give you the advice you need and they will appreciate your business much more than you could ever realize…

If you had a money machine in your basement and it printed off $5000/month until you turned age 65, would you insure it?

We can help you insure your money making machine (note: the money making machine is you!)