People with challenges ... they are like anybody else. You have to plan for your future. When the caregiver is gone, who is going to care?
Canadians with a disability should open a registered disability savings plan (RDSP).
The RDSP is a tax-deferred registered savings plan open to Canadians eligible for the disability tax credit. One of the attractive aspects of the RDSPs is the ability to supplement the plan with matching Canada Disability Savings Grants (CDSGs) and Canada Disability Savings Bonds (CDSBs) for beneficiaries age 49 and under.
CDSGs and CDSBs are based on family income. If the beneficiary is under 19, it is his or her parents’ family income. At age 19, it’s the beneficiary’s own family income. CDSGs are equal to 300% of the first $500 of annual contributions and 200% on the next $1,000 for a maximum annual entitlement of $3,500, subject to a lifetime maximum of $70,000. If family income is over $89,401, the CDSG is 100% on the first $1,000 of annual contributions.
CDSBs of up to $1,000 annually up to a lifetime maximum of $20,000 can also be paid into RDSPs for lower-income families. No contributions are required. Up to $200,000 can be invested in the plan. While contributions are not tax-deductible, all earnings and growth accrue tax-deferred.
Retroactive CDSGs and CDSBs can now be collected based on new contributions, although the government has informed RDSP issuers that payments for retroactive grants and bonds will be forthcoming within a specified timeframe.
As a result of this retroactive change, CDSGs and CDSBs will ultimately be paid on unused entitlements for the preceding 10 years (but no earlier than 2008) up to an annual maximum of $10,500 and $10,000, respectively when an RDSP is opened.
Most people will spend a lot of money protecting their home and car, but when it comes to protecting their biggest asset, THEMSELVES, this is often overlooked.
In Canada one in every three people will be disabled due to an injury for 90 days or more before they turn 65. This will have a significant impact on their lifestyle now and in the future.
Having the ability to earn an income is important to maintain your quality of life. It provides stability for your family, planning for retirement and any other goals you may have.
Disability insurance provides a source of income should you become ill or injured and can’t work. A disability can be a result of an injury, a serious illness or even a mental health issue. It can be for a short or long period.
There are various types of disability insurance, ranging from group insurance, individual insurance and government plans such as worker’s compensation.
Disability insurance is an essential part of any financial plan. If you are not able to work, how would you be able to provide for yourself and your family?
You could dip into your savings and how long would that last?
You could dip into your retirement investment account. The problem with that is you would be paying taxes on the withdrawals and would most certainly affect your retirement plans.
You could borrow from your family and friends assuming they are in a position. What are the possibilities a bank would lend you money if you are not working?
If you have group insurance are you eligible and how much are you covered for? Does it have the comprehensive coverage you need? If you change employers or become self-employed will you be covered?
We all know you can’t buy house insurance when your house is on fire, so look at making sure you are protected!
It is a program to help children continue with their studies after completing high school. A child can attend a college, a university or any other program as long as it is recognized by Canada Revenue Agency (CRA). This can be anywhere in the world.
With the cost of a post-secondary education rising every year it is vital children and parents of children take full advantage of a government program called Registered Education Savings Plan (RESP)
An RESP is a great way to grow money tax free for your child’s post-secondary education. There are many companies offering RESP. Be sure you get the one that is right for you. Some companies will allow you to contribute to a wide variety of investments where others have some restrictions and fees to set up. There is a lifetime maximum contributions of $50,000 per beneficiary. The government will contribute a minimum of 20% on the first $2500 per year in the form of a grant. Ask us how to maximize the grants that are available.
A few things to consider:
How much is needed to save for an education?
How much can you afford given other goals you may have already?
What investment will achieve this goal?
Things to look for:
Be proactive ... Invest in your child’s future!
What is it? It is the preparation for the efficient transfer of a person’s wealth and assets after his or her death.
Investments, life insurance, pensions, real estate, personal belongings and debts are all considered one's estate.
Many people think that 'estate planning' is for the affluent only. As long as one has a simple will, everything will be looked after. Although wills legally describe your wishes after your death, such as burial instructions, and distribution of assets, a judge has to 'sign off' on the procedure. This is known as 'probate' and allows relatives or any third party to contest the will. This can tie up an estate in court for years at an enormous cost in money, time and health of the beneficiaries.
So... an 'estate plan' should be considered by everybody (not just the wealthy!)
Many have said "Oh, that's what you do when you're wealthy".
People don't do the right thing because they are wealthy; they are wealthy because they do the right thing!
Why consider a plan? Without a proper plan (written signed and notarized) friends and relatives can spend endless time, money and energy fighting over your assets.
Discover how this can affect you and your family and friends!
Retirement has taken on a different meaning from 30 years ago. In the past people would go to work until they turned 65 and then live out their golden years. In some cases they were forced to retire. Now people are changing when and how they retire. Some will retire sooner, others are working beyond 65.
Thanks to medical advancements many Canadians are living longer which means our money needs to go further. Even if retirement is far off in the distance or right around the corner, there are things you can do now to achieve financial independence.
How much you need depends on what kind of lifestyle you would like at retirement. A plan will help you figure out how much you need to save and how to manage your money after you stop working.
The first step is to decide at what age you would like to say ‘Enough is enough I don’t want to work anymore’
In order to maintain your lifestyle you should plan on 80% of your current salary.
Take inventory of all your assets and the different sources of income at retirement. Sources could be comprised of a company pension and various government pensions
Identify what you are currently spending your money on and consider what your lifestyle will be in your retirement years.
Determine a realistic annualized rate of return on your investments. This should be net of inflation. An average inflation rate would be 3%.
Retirement planning is a long term commitment and should be reviewed annually to account for changes such as retiring earlier, change of jobs, or pay increase.
People don’t plan to fail, they fail to plan.
Your passage through life will be filled with twists and turns, and you can’t always see what lies ahead. But you can ease your journey by preparing yourself for the unexpected.
If you encounter a "downsizing" or other occurrence that results in the loss of a job, or even the end of a career, before you expected it, would you be able to avoid major disruptions to your lifestyle?
Even a short-term disability can seriously harm your finances — and a long-term disability could prove devastating.
Changes in your life — marriage, divorce, remarriage, children, stepchildren — can drastically affect your estate plans and the type of legacy you want to leave. Review beneficiary designations on your investment accounts, update your estate-planning documents — will, living trust and so on — as needed.
Once you reach retirement, your greatest concern may be that you’ll outlive your money. To help prevent this from happening, create a sustainable withdrawal strategy — that is, determine how much you can take out each year from your investment and retirement accounts, and stick to this amount.
You can't predict whether you will ever need to enter a nursing home or require the assistance of a home health care worker, but one thing is for sure — these services can be extremely expensive.
Your absence could jeopardize your family's financial security, particularly if you passed away while your children were still at home. To help ensure that your family could remain in the home and that your children could go to college, if they choose, make sure you have adequate life insurance.
Good Tax Saving Strategies go hand in hand with good Investment Planning.
Don’t just think about your taxes at tax time - plan from the beginning of the year and look ahead. Life events, such as having children, buying a house, paying for education or caring for elderly parents can trigger significant tax opportunities.
When it comes to tax planning, it’s important to be aware of what’s in your portfolio and the tax implications. By continually looking at your short, medium, and long term goals you’ll be able to make tax-wise decisions.
Elements of financial planning are best considered together — whether it’s your investments, taxes, or insurance, ask us to help you build a cohesive strategy so decisions are not made in isolation.
3 important functions in order to do effective tax planning.
Sometimes tax planning will bring immediate benefits but often the benefits of tax planning take time to feel the rewards. Many people are scrambling to get their taxes done for the current year but it is probably too late to do any planning for the previous year.