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This topic has come up lately. I know men that are challenging what they pay because the circumstances have changed – their spouse has recently got married and/or began to work. In other cases women are being paid by their spouse for a certain number of years as they were the primary care giver. It is important that you find out the laws pertaining to your country. The information below pertains to Canada. Nonetheless it will give you some idea of questions you can ask:

DID YOU KNOW THAT NOT LIKE THE FORMAL GUIDELINES WE HAVE FOR CHILD SUPPORT, THERE ARE NO SPECIFIC RULES FOR SPOUSAL SUPPORT UNDER THE DIVORCE ACT.

Each case is different. Unfortunately, you cannot accurately predict who will be paying how much. Either spouse can apply for support.

Some of the factors that will be considered under family law when determining spousal support are:
a. the incomes of the spouses
b. the length of the marriage
c. the roles of the spouses during the marriage

The courts will try to be fair and provide reason to the receiving spouse to become self-supporting.

In the Income Tax Act, spousal support payments are deductible to the paying spouse and included as income by the receiving spouse. However, for these rules to apply, the spousal support payments must be structured as a determined, regular payment, for example, $1,000 monthly. If a payment is not structured, it will not be deductible by the paying spouse. For example, if a former spouse pays a $500 car repair bill for the other spouse, this is not a deductible expense for the paying spouse.

If you have any further question please contact Jay Llave:

Jay Llave
Insurance and Financial Advisor
www.jayllave.com
(416) 545-5317

Tags: canada family law, FRO, spousal support

A 2010 TD Waterhouse Female Investor Poll, found that three-quarters of Canadian women aged 45 to 64 feel they are savvier investors than their mothers were at the same age.

This is a good thing. Women are now more engaged in financial planning than ever before, which is a pretty dynamic shift from a generation or two ago when many women’s finances were under their husband’s control and they relied on “pin money” to make discretionary purchases.

Becomin more independent is one of the basic steps toward financial success.

The Investor Poll found that when they were growing up, only 5% of daughters surveyed had mothers who told them to be independent – to have their own investments and bank accounts. Contrast that to today, where 69% of women have savings and investments in their own name.

There is still room for improvement … women have acheived their goal of “financial security” however many do not have a cohesive plan to achieve it. Even though it is the foundation of a financially secure future, only three in 10 women have a formal financial plan.

I want to address another issue, the women surveyed for the most part are Canadian women born here in the last 2 or 3 generations. Canada is a land that has many new immigrants. These women and men come to this country with an experience and belief system about financial institutions that may not hold true for Canada but is true from the country that they left. I will give you an example. I met this lovely, hard working, independent woman from Argentina and she told me that at home you did not trust banks. If you put your money in and the bank was robbed or money wasn’t invested well, you can find yourself without your money. There are little to no bank regulations to safeguard your money. In Canada the banks cover up to $100,000.

To me the first step is understanding our system and where you feel your money will be best served. It is likely that you will not have your money with one person or in one place. EDUCATION, AWARENESS, TRANSPARENCY – so that we can make good financial decisions.

In the Poll women defined financial success in many ways. The two most important factors were being able to pay their bills and having saved enough for emeregencies. This is comendable however very conservative and your money may not be placed in situations that will offer you the best returns — FOR YOUR FUTURE. If I stuck my money in a savings account with no interest being earned the value of that money over time will de-value just by nature of yearly inflation. Now, those investors that saw the markets as volatile just prior to the collapse in 2008, to me were very aware and understood that being in cash at that time made sense. Many lost money – some millions – in the 2008 Financial Collapse.

How about being guided so that you can begin to plan your future – be in a position to help your children if they need it, buy your dream retirement home, be able to travel if you want.

A new definition of success has been offered – a more balanced definition of success: One that not only achieves financial security, but also allows you the flexibility to live life the way you’ve always dreamed.

It’s time to raise the bar – for Canadian women and women who have just immigrated to Canada and need to learn a new system and/or way:

Maya Angelou wrote (I love her writing!): “When we know better, we do better.”

Women represent 50% of the population – our economic power is growing – let’s start to match it with our awareness!

All my best,

Sandra

Jay has written a wonderful article with really good suggestions/advice. When considering our finances – our estate, our health — the needs can change over time. As well, our responsibilities may also change. We are seeing just the beginning of the impact an aging population. While some are experiencing the “sandwich” feeling (taking care of children and older parents), this is becoming more and more a reality for many. Within my own family, my first cousin and father have been faced with making choices and decisions – health and finacial.

Take some time and read this article. If you have any further questions please contact Jay at the number below.

YOUR PARENT’S ILLNESS MAY BE SUCH THAT HE OR SHE REQUIRES SOME DEGREE OF IN¬HOME CARE. THERE ARE VARIOUS SERVICES AVAILABLE.
A part of empowerment is control over your finances and planning for life events. We age with our parents and with the lack of government resources; these are very real life situations.
Your parent may find that due to his or her illness he or she does not have to be hospitalized or in an institution but can remain at home with some assistance. The extent of the assistance will vary. Depending on the circumstances you, your family or friends may be able to provide some of this help and this is an area where you should have an open and frank discussion with the interested parties to determine if this is practical. Your parent’s needs might be quite modest and able to be met without putting unreasonable demands upon anyone else’s time. In other cases you may come to the conclusion that outside help is required. Some of the areas of assistance to be considered are:

Meals
Your parent may be in the situation where he or she can manage to make himself or herself breakfast and lunch, but do not feel up to making an evening meal. You and your family may decide that you can do some periodic shopping to keep him or her supplied with essentials as well as provide an evening meal. However, family schedules and proximity may make providing regular meals impractical so a popular alternative could be ‘Meals on Wheels’ or a similar program in your community. For a relatively modest cost, usually about $5, your parent will receive a nutritious, balanced meal delivered to his or her home.

Transportation
When you parent is ill but still able to get around you will need to consider the extent of their mobility and needs. Devices such as canes and walkers can be of great assistance to people with reduced mobility. Electrically powered scooters are also available but can be rather expensive (~$2,000). If your parent is relatively mobile, he or she may want to get out periodically to shop or attend doctor’s appointments. You and other family members or friends may be able to arrange a schedule to make these trips. If this is not practical, many communities have organizations that provide transportation services for those with limited mobility as well as volunteer drivers who can take the patient to doctor’s appointments or therapy sessions.
If your parent is still able to drive their car, you should look into getting a disabled parking sticker to minimize his or her walking. e appropriate provincial ministry will require a signed statement from a qualified health professional that the applicant qualifies on medical grounds.

Home and Garden Care
If your parent is able and prefers to remain at home, he or she will probably require some assistance in maintaining his or her home and garden. You and your family members may be able to arrange an acceptable schedule and list of responsibilities. Required assistance will probably include laundry and cleaning as well as garden maintenance, snow removal, etc. If family and friends are unable to manage these things, there may be local volunteer services available that provide assistance for infirm/disabled persons. You may have to make arrangements with local companies that will require paying commercial rates which must be factored into the budget.

Visiting and Monitoring
When your parent is at home, you will want to arrange for visitors to call on a regular basis. This will not only help to ensure that he or she is managing but provide some important social contact. Live-in Assistance
Your parent’s condition may be such that he or she will require more constant care with an attendant in his or her home for most or all of the day. This will be a more expensive option. You should check to see if there are government agencies to assist you in finding and paying for in-home care. The relative costs of having your parent live in a residential facility would need to be considered as well as the emotional factors since many elderly people are attached to their homes and are very reluctant to move to a care facility.

Adult Day Care
Many communities offer facilities where seniors can spend their days in a safe, social environment.

Respite Care
If you and/or other family members are providing in-home care for your parent, there are Respite Care programs where a qualified attendant will visit periodically to provide care for your parent while the primary caregiver can ‘take a break’. is can be an important service to prevent the build-up of stress for the caregiver(s).

Where to Start
Please contact me. I have access to a great deal of information on the type of support services available. For example, in Ontario, the Ministry of Health and Long Term Care is an excellent place to start to learn about the options available to assist people in finding and funding in-home care.

Jay F. Llave
“Create and Protect Wealth”
Insurance and Financial Advisor
Creative Planning Financial Group
(416) 487-5210 ext. 5317
http://www.jayllave.com About me
http://www.jayllave.com Our BLOG

I hope you enjoyed this as much as me.

All my best,

Sandra

Tags: assitance, finances, long term health care, meal choices, montoring care, respite care, sandwich generation, social services available to older people, the ministry of health (ontario) and long term care, transportation

I met with Warren Blatt, one of my financial planners and we started to talk about the financial crisis and how it woke people up to asking better questions and making better choices. In Canada people were hit however miniscule compared to the US and other European countries. Our debt in Canada is only 3% versus 66.2% in the US, Japan 121.7%, Greece 104.3%, and Italy 116%. This does not mean that we can allow our debt to equity ratio (how much debt we have: mortgage, loans, etc. versus what we own – equity) to climb. While interest rates and mortgage rates remain low in Canada, small changes can impact us – means we have to pay out more money to cover the loans and less money in our pocket to spend on the necessities for our families.

Saying that now is a good time to think about where you are putting your money. Women in Canada represent 50% of the economic power. Now is the time to assess, do I like the person/people I am working with? Do they listen to my questions and answer them to my full understanding? Are they accessible and can I reach them in a timely manner? What are my fees that I am paying them? Are they being up front about my investment and the yearly fees I pay? I have already told you that I refuse to invest in mutual funds for I feel that the 2.5% yearly management fee that is being charged for these funds is not warranted to their return (how much I earn on this investment) compared to other options which yield higher returns and have less fees.

It is about new beginnings and taking back your power and responsibility. Do not be swayed and make sure that you invest in things that YOU FEEL comfortable with.

Canada is in a good financial position compared to the rest of the world.

I just read a disturbing article that talked about how in the US there is a growing income inequality which can destabilize the US. From 1980 t0 2005 more than 80% of wealth went to the top 1% . Productivity increased by 20% yet virtually none of the increase translated into wage growth at middle and lower incomes. According to this article and a source, “according to the CIA income distribution in the US is more unequal than in Guyana, Nicaragua and Venezuela and is roughly on par with Uruguay, Argentina and Ecaudor.”

Even Alan Greenspan has noted this issue which seems to have been pushed down in America. He says, “This is not the type of thing which a democratic society can really accept without addressing”.

For my counterparts in the US you have an election coming up – you need to bring this to light. You want to bring your country to a better financial position.

In the meantime, take a look at your finances and make decisions that allow you to get yourself out of debt, if you are in debt, and see how you can begin to rebuild your future! It’s all about baby steps.

All my best,

Sandra

Tags: Alan Greenspan, CIA, financial inequality in US, Latin Amrerica

WHEN YOUR MARRIAGE BREAKS UP, YOU MAY WANT TO CHANGE WHO RECEIVES YOUR ASSETS IN THE EVENT OF YOUR UNTIMELY DEATH.

There are various issues to consider:
a. Your Will
Usually couples make each other the beneficiary of their Wills. When you get divorced, any provisions in the Will where the former spouse is left assets or made the Executor are revoked. Therefore, you will need to reassess the provisions in your Will. Consequently, if you are drafting a new Will after a marriage breakdown, you should make sure that any dependent children are properly provided for on your death. The Family Law court can step in and overrule your Will if you don’t. Take the opportunity to review 2bempowered Will planning checklist on important issues to consider when creating a Will, and complete this 2bempowered personal record keeper to help you gather and update important information that you can share with loved ones including your executor or executrix.

b. RRSPs and RRIFs and Life Annuities
With these investment structures you can (and should in most circumstances) have named beneficiaries. When your relationship breaks down you will need to look at these to determine if the beneficiaries are still appropriate in your new situation.

Insurance
In many cases, married couples name each other as the beneficiaries of their life insurance policies. If you are becoming separated or divorced, you may want to reconsider who you name as your beneficiary. If you do not contact the insurance company, your former spouse will continue to be the beneficiary of the policy. In the case of relationship breakdown, you may want to change the insurance coverage on your life in order to provide for your children should anything happen to you.
Depending on the nature of the separation agreement, you may be required to buy life insurance with your former spouse and/or children named as the beneficiaries. This is typically the case where spousal and/or child support is being paid by the primary income earner. This ensures that if the supporting spouse dies, there would be enough money to support the children. In the case of this type of policy, the beneficiaries are ‘Irrevocable’. That means the beneficiary cannot be changed to someone else without the written permission of the current beneficiary.

Jay F. Llave
“Create and Protect Wealth”
Insurance and Financial Advisor
Creative Planning Financial Group
(416) 487-5210 ext. 5317
http://www.jayllave.com About me
http://www.jayllave.com Our BLOG

2bempowered’s Personal Records Keeping:
Make sure that your spouse/siginificant other/children/executor know where the following Documents and Information Is:
* your will
* the family passports – for each person
* Birth Certificates OR Landed Immigrant Status Papers OR Citizenship (if new)
* Health Card for all family members
* CPP information
* RRSPs – what are you invested in?
* Name and number of Children’s doctor: family, eye, dentist, specialists
* What bank(s) do you and your significant other deal with – all accounts
* Name of your financial advisor(s) – what does he/she financially control? There may be different people that you deal with.
* Investments – mutual funds? Insurance? Reits? Where is the money invested?
* Name of accountant(s) and lawyer(s)
* Who is your mortgage registered with – what is the status: renewal date, how much owing on it, etc. Whose name is on the mortgage? Is there a lien on the house?
* Car leasing information
* Property taxes – are you paid up to date?
* Personal taxes – is your spouse paid up to date?
* Personal Bankruptcy- will this affect the estate?

2bempowered’s Will Planning Checklist:
* in the case of joint custody, if you die before your ex-husband/wife the children will go to the custody of the living parent. In a case where both parties are gone you must think about who you want to leave your child/children to – who will be the most responsible, parent in the way that you want, and loving to your child/children.
* in the case of sole custody then naming a person to care for your child/children is imperative. Again, think about the most responsible, a person/couple who parents in the same way you do, and one who loves your child.
* Make sure that you have enough life insurance for your children so that they can live in a lifestyle that they are used to. Term insurance is inexpensive. Name your child/children the beneficiaries
* In a will you have a financial executor – choose wisely, one that will work in the best interests of the child/children, you can trust with the money that is left, and will honour your wishes. I have spread out the distribution with 25% at age 21, 25% at age 30 and the remainder at age 35. I am concerned that if my children are left with too much money at a young age they will blow it. The executor will have discretion to distribute for what is necessary – education and so on.
* In a will you also have a medical executor – make your wishes known to this person – Do not want to have heroic measures done? Do not want to live in a vegetative state? Make sure that your beliefs are known to this person so that they will carry them out.
* In the case of property – make sure that all your taxes are covered so when the property is transferred to the child/children (young or old) that they do not have to worry about this. In many cases, property – second homes, cottages, condos, apartment buildings, etc. are passed on and there is a capital gains tax that if not financially considered can make the property too expensive for the child and will need to be sold. (This is in Canada – other countries may have different rules).
Make sure that they are the beneficiaries of your property.
* RRSPs – make sure again that you have the taxes covered for your investments. RRSPs work because they are a deferred tax – someone will have to pay for the taxes.
Make sure that the child/children are listed as the beneficiaries.
* Insurance – make sure again there are no tax costs – and make sure

I strongly suggest that you sit down with a lawyer and discuss what your needs are. A will doesn’t have to cost a lot of money – $300-$400. It is a worthwhile investment and will give you peace of mind.

Depending on what country you live in you will have to find out the laws around transferring property (primary and secondary), RRSPs (registered retirement savings plan) and so on.

Don’t wait do it now!

All my best,

Sandra

Tags: divorce, estate planning, executors, financial planning, listing beneficiaries, wills

I wanted to share with you and article that I received from my financial advisor on Mutual Funds. I just talked to him this morning and we both agreed FOR ME, I will not be investing in any more mutual funds. Why? The return on a mutual fund is less than the fees that your advisor charges to maintain it from year to year. There is often a yearly cost to “running” the fund and there is often a hidden upfront or back-end cost that if you want to get out the fund before a certain time frame you will be charged XX dollars.

What can you do, as an educated investor – ASK QUESTIONS – Is there a yearly cost to maintain this fund? If I want to cash out the fund because I need the money will there be a cost? How long do I have to keep it before it is clear and free? Often it is 7 years, before you can get your money without a “penalty cost”.

Here is the article printed in the Toronto Star. Note that other countries have decided to BAN Mutual Funds.

This article appeared in today’s Toronto Star. It is another article confirming my despise for the mutual fund industry. Canada continues to drag its feet while countries like the UK, Australia, and the US are steadily banning the use of mutual fund trailer fees …. Enjoy the article.

http://www.thestar.com/article/846861–daw-industry-defends-mutual-fund-trailer-fees

Financial advisers are watching nervously and defending their value to Canadians as three other nations prepare to outlaw or curb what is, for most, their primary source of income.

Earlier this year the United Kingdom moved to outlaw by 2012 the sales commissions that are embedded in fees for investment products. Australian regulators proposed something similar. Then, late in July, the U.S. Securities and Exchange Commission (SEC) voted to cap such fees for mutual funds at a quarter the 1 per cent fee included in some funds in Canada.

No caps or bans are on the horizon in Canada. Yet associations for the investment industry and advisers were caught by surprise by the SEC’s vote. So the potential ramifications are already a hot topic for discussion.

A lot of money is at stake. Carlos Cardone, senior consultant with research house Investor Economics, says about $2 billion was deducted from Canadians’ mutual fund assets in 2009 to pay advisers what are called trailer fees.

That compares with about $9.5 billion in the U.S., with ten times the population. The Canadian figure excludes what banks embed in their funds to pay sales and advisory staff. Bank funds hold roughly 30 per cent of total mutual fund assets in Canada.

Cardone predicts a decline in trailer fee revenue, with or without changes in the law on such fees.

“Trailers are likely to be the next frontier for the decline in (fees for expenses) for mutual funds,” he said Wednesday. He foresees banks’ with lower fees will sell more mutual funds, driving others to lower total fees. At the same time, there is a relatively small but rapidly growing trend toward paying separately for advice and buying low-fee funds online.

The cost of advice and management for mutual funds is at the heart of the debate over whether the federal or provincial governments in Canada should offer cheaper alternatives for saving for retirement.

So the mutual fund industry and adviser associations are fighting back. The are emphasizing the value of advice in promoting savings and responsible money management, and using consumer surveys to prove their point.

Cary List, president the Financial Planners Standards Council that accredits and monitors Certified Financial Planners, says his groups’ research has found that 80 per cent of consumers who pay for financial advice make use of registered savings plans.

That compares with only 37 per cent of Canadians who try to get by without professional advice.

A separate report released Wednesday by the Investment Funds Institute of Canada reports data that individuals who choose financial advice accumulate more assets and are better prepared, financially, for retirement.

“Advised households, where the head of the household was between 45 and 54 years of age had nearly three times the level of investable assets of non-advised householders,” according to the report. “Having advice is strongly associated with the accumulation of financial wealth regardless of income level or age of household.”

It’s possible, however, that higher level of savings came first and the desire for advice second.

But List suggests that including the cost of advice mutual fund fees helps to ensure more Canadians will get advice. ( He would prefer they get it from CFPs, who have a code of ethics that requires them disclose the fees and put the interests of clients ahead of their own.)

“There is more need for professional advice than ever before,” he argues, pointing to the worrisome decline in the rate of savings in Canada to a lower level than in the United States.

“Currently, we don’t see an environment where people are willing to pull out their cheque book to pay for advice,” he said. Only about a tenth or 1,500 earn a living without being licensed to sell financial products and earn embedded sales commissions.

jdaw@thestar.ca

Tags: back end costs, front-load costs, Jeff Kaminker, Mutual Funds, Toronto Star paper

I am thrilled that this is so. I was asked to speak at one of my chapters on the topic of Financial Empowerment.

I sent two topic ideas:

1. The Role Of Women Today – it has been documented that women are no happier today than their predecessors – even going back to the Women’s Movement in the 1970s. Women are reaching greater positions within the corporate world, within countries – even leading countries – yet to do so there has been a mind set that women need to behave like men, be aggressive, manipulative and step on people – we have a glass ceiling. This is not true. Women can still achieve what they want and do it in a way that allows them to draw on their masculine energy (create my value/speak my truth) and feminine energy – nurturing, kind and compassionate.

2. Financial Empowerment- for too long women have handed off to their spouse, accountant, financial advisor their finances to the point that if something happened to their spouse or significant other they have no idea of their financial situation. Learn that taking back your responsibility and accountability can be fun — it’s a lot like organizing your closet!

While I like the first topic I am determined to bring financial awareness to women – mostly reducing the fear around this area and having them understand that they already perform so many of the actions on a daily basis – budgeting, organizing, tacking stock, and just plain doing!

I will let you know how it goes. I plan to bring this workshop to all women.

Let’s make 2010/2011 the year to take back your power – it puts you in a position to make good decisions and in the least be knowledgeable of your financial position.

All my best,

Sandra

Tags: budgeting, finance, financial awareness, financial literacy

In part of the process of understanding your finances it is imperative that you understand the terminology. Fancy names can be broken down to the most simple so that everyone understands. Being aware allows you to make better financial decisions that serve your needs. This way you are in full control of your future! Thank you Jay & Joan!

Tax Terminology and Acronyms
Terminology (general definitions):

Adjusted Cost Base (ACB)
In simplistic terms, adjusted cost base refers to the capital cost of depreciable property and, for property other than depreciable property, the cost to the taxpayer of the property with specified adjustments.

Allowable Business Investment Loss (ABIL)
Allowable business investment loss is a special rule to allow 50% of capital losses on shares or debt in a small business corporation to be offset against income when calculating taxable income.

Alternative Minimum Tax
A structure that provides for the recalculation of an alternative amount of tax based on the removal of certain tax preferences when compared with the regular tax calculation.

Canadian-Controlled Private Corporation (CCPC)
Canadian-controlled private corporation is a private corporation that is not controlled directly or indirectly by a public corporation, by non-residents of Canada, or by some combination of both.

Capital Dividend Account
A notional account available to private corporations to integrate corporate and personal income tax on the receipt of items such as the tax-free portion of capital gains and the proceeds of life insurance policies.

Cumulative Net Investment Loss (CNIL)
Cumulative net investment loss is the excess of investment expenses over investment income cumulatively since 1987 that reduces the amount of the lifetime $500,000 capital gain exemption.

Depreciable Property
Property owned by the taxpayer that is entitled to apply capital cost allowance.

Exempt
The item is not subject to income tax. An example of income that is exempt from income tax is a life insurance benefit payment or money that is inherited. In these examples, the initial funds are tax-exempt, but investment earnings on the funds are not.

Fully Taxable
The item is subject to regular full income tax. An example of this is employment earnings or interest income.
General Anti-Avoidance Rules (GAAR)
General anti-avoidance rules give the CRA broad powers to challenge technically correct transactions that violate the spirit and intention of a section of the Act or are abusive of the Act read as a whole.

Income Tax Instalment Payments
Under specific circumstances, a taxpayer may be obliged to make successive payments directly to the government for an income tax liability that is created during an ongoing taxation year.

Inter Vivos Trust
A trust that is settled by a living person.

Kiddie Tax
An income-splitting tax imposed to discourage income splitting with children.

Listed Personal Property
A sub-set of personal-use property.

Mutual Funds
A mutual fund is a pool of investment capital that has been used to purchase a basket of investment vehicles, most often equities or debt instruments. Investors may purchase an unlimited number of units (in mutual funds structured as trusts) or share (in mutual funds structured as corporations) in these investment pools, hence, the term mutual fund. The more units/shares of a mutual fund that are purchased, the lower the value of each unit/share. In general, mutual funds allow investors to purchase ownership in a diversified portfolio of investments for relatively small amounts of cash.

Personal-Use Property
Property that is used primarily for personal-use or enjoyment by the taxpayer or by a person related to the taxpayer.

Prescribed
Set or established by regulation as in prescribed interest rate.
Prescribed Interest Rate
The Act prescribes several interest rates to be applied in different situations. Items such as late taxes, tax refunds or taxable benefits attract interest and the prescribed rates dictate the amount.

Qualified Small Business Corporation (QSBC)
Qualified small business corporation are shares eligible for the $500,000 lifetime capital gains exemption.

Recapture of Depreciation
The recapture of capital cost allowance previously claimed as a deduction from income and brought back into income because of disposition.

Segregated Funds
An individual variable insurance contract, better known as a segregated fund, is an investment contract, considered insurance by law, where a specified group of assets outside the company’s general reserves supports the contract’s policy reserves. Segregated fund policies have values that vary according to the market value of their specific group of assets. Assets of segregated funds are not part of the general reserves of the insurer, so no laws prevent them from investing all their assets in equities. Depending on its contract, a segregated fund may allocate the assets to a fund of treasury bills, common shares, bonds and debentures, real estate or mortgages, like a mutual fund.
Sheltered
The item is subject to tax, but at a point in the future. An example of this is the earnings that grow within an RRSP or RRIF.

Small Business Corporation (SBC)
A CCPC of which all or substantially all of the assets, on fair market value basis, are used principally in an active business, carried on primarily in Canada.

Testamentary Debts
Refers to amounts payable as a consequence of death and includes income or profits, taxes of the deceased for the year of death or previous years, and any death taxes payable as a consequence of death.

Acronyms
ABIL Allowable Business Investment Loss
ACB Adjusted Cost Base
Act Canadian Income Tax Act
AMT Alternative Minimum Tax
CCA Capital Cost Allowance
CCPC Canadian-Controlled Private Corporation
CRA Canada Revenue Agency
CDA Capital Dividend Account
CEC Cumulative Eligible Capital
CNIL Cumulative Net Investment Loss
fair market value Fair Market Value
GAAR General Anti-Avoidance Rules
ITA Income Tax Act
ITR Income Tax Regulation
LSVCC Labour-Sponsored Venture Capital Corporation
MTR Marginal Tax Rate
QSBC Qualified Small Business Corporation
RDTOH Refundable Dividend Tax on Hand
V-Day Valuation Day
SBC Small Business Corporation
TONI Tax on Income
UCC Undepreciated Capital Cost

Jay F. Llave & Joan Morrow

Creative Planning Financial Group

(416) 487-5210

Tags: financial acronyms, financial terminology, understanding financial terms

This is a good topic for me today for I want to write about our relationship or LACK OF relationship in Canada, actually North America, with our elderly.

There is much wisdom that can be imparted to us from our grand parents and great grand parents that when applied, maybe tweaked slightly, can really make a difference in our life.

The topic today focuses on teaching our young about money. Right now, as it stands, I invest my children’s money and they cannot touch it. I leave some in their account so if they really want something they can buy it. I know, that in some ways I am still enabling them. It is funny because my son wrote home from camp that his first day was challenging because he had to unpack his clothes and put them away HIMSELF. He is 10 1/2 years old. When I received the letter I thought to myself — this is good — he needs to learn to be responsible and accountable.

Consumer debt is a problem that is plaguing ALL countries around the world. Canada is one that is doing financially better than most. Do not kid yourself, we can easily become the US, Europe or Japan if we do not watch how we spend. People have been spending beyond their means for too long. Interestingly, my parents, or I should say my father, only spends what he can afford. He may create some debt however it will be manageable and likely for business. I learned this from him. I also learned in my failed marriage how to spend beyond my means. It is not a good felling and one that I WILL NOT repeat.

How do we teach something that we, ourselves, are not good with. I have some tips that Joan and Jay have provided. I do feel that we must learn to lead by example. Take this as a starting point. I have made it one of my missions to teach women financial literacy. I stay commited to this.

In the meantime… Here are 3 tips:

Three Ways To Teach Kids About Money

We hear a lot about financial literacy these days as Ottawa promotes its efforts to educate Canadians about money management, saving and investing. Clearly, the first steps begin with our kids, and not just in the classroom.

Parents, grandparents, and other caregivers can provide some of the building blocks to economic maturity by sharing their own experiences with money. Here are 3 ways you can help them understand basic financial concepts.

1. Let them manage their own income. It’s important for your kids to have their own money to manage – and mismanage. They will learn a lesson (albeit painful sometimes) when they spend their entire allowance on an impulse purchase.
2. Help them set goals and allocate their money. Set goals for donating, savings and spending and give them separate piggybanks to allocate the chosen portion of the money they earn.
3. Show them the power of compound growth. Opena savings account, GIC or other investment for your child. If you have online access to the account, even better – yur child can track its accumulation and online calculators to project future growth. It can be fun too!

Joan can be reached at 416-545-5352 or email her at joanm@cpfg.com

Jay can be reached at 416-545-5317

It is time as individuals we take responsibility and accoutability for our actions, choices and outcomes. If we want to change something, a behaviour, than we must change the way we think. It is ok to have “stuff” however at what expense. It is time to begin to live within our means.

All my best,

Sandra

Tags: accumulation, compound growth, donations, financial literacy, ottawa, spending, wealth, young

This is the title of an article I recently came across. The article is an interview with Maddy Dychtwald, who co-wrote the book, Influence: How Women’s Soaring Economic Power Will Transform Our World For the Better with co-author, Christine Larson.

Maddy says, “the status of women is changing”. With women representing in some countries over 50% of the population, holding more prestigious positions and earning higher salaries than ever before, their earning power is increasing — allowing them to influence change. For the past two decades, the increase in female employment in the “rich” world has been the main driving force of growth, the Economist magazine said in 2006. “Those women have contributed more to global growth than have either new technology or the new giants, China or India”. That is incredible!

Maddy Dychtwald and her husband, Ken Dychtwald, co-founded the demographics research firm AGE WAVE. They conducted a survey along with Allianz, a financial services company, and Harris Interactive, a public opinion research firm, with 3,000 men and women with one question in mind – how do women handle their money as opposed to men?

3 trends emerged:

1. Money means security to women, freedom to men. Overall, women were far less optimistic and confident than men were about money. One in five women had a secret stash of money her partner didn’t know about – twice the number of men with a secret stash- to use as a hedge against financial disaster.
2. Men see themselves as warriors and women see themselves as worriers. Men are almost twice as likely to say they would take significant financial risks, while women are more likely to buy and hold investments, rather than churn them. As a result, women’s investments often do better than men’s in the long run (interesting – we let them grow!).
3. WOMEN ARE MORE LIKELY TO PUT OTHERS’ FINANCIAL NEEDS AHEAD OF THEIR OWN. The often feel torn between the desire to do what’s best for their family and what’s best for their own future.

While women may be hurting themselves, there is a social benefit when women chose to use their earnings to pay for university, support their children or help care for their aging parents.

Maddy says that despite women’s growing economic power, MANY WOMEN ARE UNSURE OF THEIR MONEY MANAGEMENT SKILLS. THIS LACK OF CONFIDENCE IS A ROADBLOCK TO ATTAINING THEIR DREAMS.

My feeling, and of course it is just that, is that women need to become accountable and responsible for their financial choices and outcome. It means simply reducing fear around an area that most women have handed off to their spouse, significant other or advisor. It is time that women take back their power. It means educating ourselves in this area. What I love about this area of my site is that it allows women to ask the most minute, simple question without fear of being ridiculed or laughed at.

I am well aware of my finances for I am divorced and have no choice. As I educated myself and asked MANY DUMB questions I now feel strong and confident when I sit with my bank person and am renegotiating my mortgage. I will no longer hand away my power. If I do not like something I will question it. It is my money and my choices. Saying that I often use my gut and intuition when making choices – like choosing my financial advisor. I needed to know that we were on the same page, that I can call him with a question and he will get back to me, and he does. I have referred him on to many other people. I also like that I have made money with him!

WOMENS’ ECONOMIC POWER AND INFLUENCE will change the way that marketers talk to us. Maddy says that women are the primary buyers of just about everything. We are responsible for 80% of consumer purchases! We can drive a new industry to grow or fail. Look at the organic and natural foods industry. It has grown 28% in two years, largely driven by women.

On my vision board I have the following words: I choose to embrace my power: confident, bold, beautiful after 40!

Women of the world, let’s embrace this power and use it in a way that is loving, kind and compassionate while still impressing what we want. That is what I call EMPOWERMENT and balancing our male and female energies- being empowered in a way that we are strong and embrace and live by our truth however in a loving, kind and compassionate way.

Tags: Age Wave, Aliianz, fiancial awareness, Harris Interactive, Maddy and Ken Dytchwald, women enconomic power

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