In the last article Sue had a capital shortfall of $400,000 in order to support her desired retirement lifestyle. This amount will vary for each individual and will be larger or smaller depending upon your income, age and ability to save money as a percentage of your earned income.
Ray had thought of his life insurance purely as a protection plan. The anti-avoidance rules and general restriction of tax benefits applicable to most shelters prompted him to take a new look at his life insurance for tax deferral as well.
Recently, a client wanted to leave all of their money to two charities through their Will. They wanted to leave a legacy to a couple of charities that were close to them and they didn't have any close family members.
Here is her situation: Age 80, $550,000 in savings (75% non-registered and TFSA), with income of $70,000 annually from pensions and RIFS while living in an upscale retirement residence. She was also spending an additional $20,000 a year from savings to support her lifestyle.
High net worth investors are now sitting back and enjoying the summer weather, breathing a sigh of relief now that they are done with their annual tax filings. The work involved in assembling all of the relevant tax information is made more complicated by the fact they often deal with several investment firms.
U.S. financial research firm, Cerulli Associates, recently found that high net worth investors had, on average, 3.7 investment advisors. Ultra-affluent investors often spread their investments across many more.
John was concerned because his 82-year old mother, Betty, was having trouble generating sufficient income to cover her cost of living with interest rates at rock bottom levels. Along with many other investors globally who have poured some $4 Trillion dollars into government bonds since the 2008 Credit Crises, she wanted to feel safe and have her money guaranteed. But the price of safety in a low interest rate world is higher than you may realize.
As with many retirement savers, it took two stock market crashes (2001, 2008) and a global financial crisis to convince Adam and Sonya that trying to 'time the market' or pick specific sectors was a costly exercise in futility. But, with the value of their RRSPs nearly halved in the 2008 crash, they also recognized that they could not afford to avoid equities if they were going to have any chance of meeting their retirement goals.
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