When the economy (and financial markets) are at it’s extremes, either doing extremely well or extremely poorly, dangerous financial products and ideas become more prevalent. And right now we are seeing an increase in Offering Memorandum products.

Portus, Eron Mortgage Corp, Shire International Real Estate Investments, and Arbour Energy and just a few Canadian examples. The one common denominator they share, is they all are catagorized as Exempt Market Securities.

What are Exempt Market Securities?

…when companies (issuers) sell securities such as stocks, options, or bonds, they are generally required to file a prospectus. This document contains material facts about both the issuer and the security. However, in certain cases securities can be sold without a prospectus and these investments are called exempt securities; the sale is called an exempt distribution or a private placement.

What should I know about Exempt Market Securities?

These investments are not for everyone. A prospectus is meant to ensure an investor has key facts to be able to make an informed decision. Without it, you may be taking a greater risk with your money. Be aware that:

-If you buy an exempt security, you may not have the same legal rights as you do under a prospectus.

-Most exempt securities are subject to resale restrictions. This means you may not be able to sell them for a certain period of time.

-Even if no resale restrictions apply, there might not be a market for the securities you purchased, either because you would not be able to find any purchasers or they may not qualify to purchase the securities.

-Some exempt securities are not liquid. Liquidity means that you can sell an investment in a short period of time and turn it into cash. Some exempt securities, such as hedge funds, may require longer periods to redeem.

-Because these investments are bought without a prospectus, there may be very limited information available on which to base your investment decision.

-When an issuer sells its exempt securities, it may not use a registered dealer as an agent. This means, when you buy from an issuer, you may not get the same protection you would get when you buy from a registered dealer.

–from a release by the Nova Scotia Securities Commission and cirrulated by the other regulators. (footnote 1)

A disclosure document put out by the BCSC includes this simple explanation (footnote 2):

They are called exempt market securities because two parts of securities law do not apply to them. If an issuer wants to sell exempt market securities to you:

-The issuer does not have to give you a prospectus (a document that describes the investment in detail and gives you some legal protections), and
-The securities do not have to be sold by an investment dealer registered with a securities regulatory authority.
There are restrictions on your ability to resell exempt market securities.Exempt market securities are more risky than other securities.

Disclosure documents (be it a Prospectus, when regulated by the Securities Act, or a Policy Contract/Information Folder, when regulated by the Insurance Act), exist for a reason, To protect the investing public. There is no evidence proving the absentence of disclosure documents increases potential return, but it is well known to increase risk.

Policy Contracts and Prospectuses are the financial world’s equivalent to seat belts. Hopefully you won’t have to depend on them in a life or death situation. The best option for most regular folks is to just avoid these dangerous investments. Just like it always advisable to wear your seat belt.

First off… What is a Super Visa?

This a special visa granted to foreign parents or grandparents of Canadian citizens (or permanent residents) which allows them to visit with their family here in Canada for up to two years without needing to renew.  A Super Visa is valid up to tens years.

So why would I be blogging about this?

Well, one of the requirements is proof of private Canadian medical insurance. At Manion & Associates we can help you acquire private medical insurance.

Who is eligible for a parent and grandparent super visa?

To be eligible for the super visa, applicants must be the parents and grandparents of Canadian citizens or permanent residents. Dependents of parents and grandparents are not eligible for the super visa. However, they can apply for a regular visitor visa. The super visa applicants must also be found admissible to Canada and meet some other conditions.

Visa officers consider several factors before deciding whether an applicant is admissible. Officers must believe the applicant is a genuine visitor to Canada who will leave by choice at the end of the visit. Among the things the officer might consider are the following:

  1. The person’s ties to his or her home country;
  2. The purpose of the visit;
  3. The person’s family and financial situation;
  4. The overall economic and political stability of the home country; and
  5. Invitations from Canadian hosts.

The parent or grandparent must also do the following:

  1. Provide a letter promising financial support from their child or grandchild in Canada who has a minimum income;
  2. Prove he or she has Canadian medical insurance for at least one year to cover the time he or she will be in Canada; and
  3. Complete an immigration medical examination.

In regards to the medical insurance, we can help!

 

Don’t be worried – yet – about tardy T3s

via Don’t be worried – yet – about tardy T3s – The Globe and Mail.

I want to file my taxes and get my refund, but I’m still waiting for tax slips for a few REITs and ETFs that I own. Shouldn’t I have this information by now?

Not necessarily. Different types of tax slips have different mailing deadlines.

T5 slips – which report dividend and interest income – were supposed to be mailed out by the end of February, so you should have these by now.

But T3 slips – which report distributions from incDifferent types of tax slips have different mailing deadlines. (Mackon/Thinkstock)ome trusts (including real estate investment trusts), exchange-traded funds and mutual funds – have a deadline of March 31. So it could be a week or more before they land in your mailbox. T3s for REITs and ETFs are sent by your broker, whereas T3s for mutual funds are mailed directly by the fund company.

Occasionally, tax slips are delayed, however.

My discount broker, BMO InvestorLine, says on its website that it will “make every effort to ensure that tax slips are mailed by the date indicated; however, in the event that an issuer does not supply us with the necessary information in time, tax slips will be processed on an individual security basis and mailed as soon as the information is made available.”

I had a quick look on the websites of three ETF providers – iShares, BMO and Horizons – and the 2014 tax information has already been posted. I also checked the websites of three REITs – RioCan, Canadian REIT and Calloway – and they have also published the 2014 tax breakdowns for their distributions. So if you want to crunch the numbers yourself, you can. But to avoid mistakes on your return, you might want to wait until the official T3 slips arrive.

In the meantime, if you’re using tax software, you can always complete the rest of your return and then spend a couple of minutes entering the information from your T3 slips when they arrive. That way you’ll still get your return in long before the April 30 deadline.

Originally posted on Global News:

Depending on your income and circumstances, recent changes to Canada’s tax system could provide you a bit of a break at tax time.

“Always do your research, there are always changes,” said Caroline Battista, senior tax analyst at H&R Block Canada. “Some years the changes are bigger than others, but there’s always changes. Make sure you’re getting back as much as you can.”

Here’s what’s new for the 2014 tax year:

1. Family Tax Cut

A new Family Tax Cut (FTC) was introduced in October 2014. It’s a non-refundable tax credit for eligible couples with children under 18.

Often referred to as income-splitting, the FTC allows a spouse or common-law partner to receive a credit (up to $2,000) based on the tax they would have saved if income had travelled from the higher income earner to the lower (up to $50,000 of taxable income).

“The income doesn’t actually travel to the other’s…

View original 946 more words

Why are employees leaving free pension money on the table? – The Globe and Mail.

Fred Vettese is the chief actuary at Morneau Shepell, a human resources and actuarial consulting services firm.

Canadians are forgoing as much as $3-billion annually by not taking full advantage of employer matching contributions within their company defined contribution (DC) pension plans, according to a recent Sun Life Financial report. One has to wonder why employees would pass up free money when there are no strings attached.

Employees in most DC plans have the option of contributing extra, and if they do, the employer makes a matching contribution on their behalf. Sometimes it is a partial match, such as 50 cents for every dollar contributed by the employee, and sometimes it is a full match. Employers offer contribution matching to encourage employees to save more for retirement.

To gain some insight into why a significant percentage of DC participants balk at contributing more, I analyzed data from a number of DC pension plans for which Morneau Shepell does record-keeping. My investigation, which encompassed tens of thousands of employee records, turned up the following:

  • About one third of participants in a given plan do not make an optional contribution, even if it is 100 per cent matched by the employer.
  • Up to two thirds will not make an optional contribution if the basic required contribution they are already making is high, such as 4 per cent of pay or more.
  • One would expect older employees to contribute more since they will get their hands on the employer’s money sooner. But it turns out the impact of age is quite minimal, especially if we correct for salary differences. In some groups, a fifth of the employees in their 50s do not make optional contributions.
  • Salary level has a big impact on optional contribution rates but only up to the average national wage level – the low $50,000s. In one case, nearly half of employees in their mid-40s who were earning under $50,000 opted not to contribute versus only 18 per cent of employees in the same age group who were earning over $50,000.
  • In plans where the range of optional contribution rates is limited, the employee’s decision is practically binary. The vast majority either contribute enough to earn the maximum employer matching or they contribute nothing. This suggests that deciding how much to contribute is not based on ability to pay or on perceived retirement income needs, but rather on whether or not one understands the idea behind the optional matching.

What is noteworthy is that many of the employees who elect not to make optional contributions to their DC plans still contribute to their own Registered Retirement Savings Plans (RRSPs). According to Statistics Canada data, over half of the participants in pension plans, including DC plans, also contribute to RRSPs. A rough estimate is that several hundred thousand DC plan participants are forgoing employer matching contributions in their DC plans and instead make personal RRSP contributions that are not matched.

Read the rest of the article here…

Why are employees leaving free pension money on the table? – The Globe and Mail.

Originally posted on Allen LaRose, EPC, FMA, CIM, FCSI:

If there is one thing that I have a real “bee in my bonnet” about, it’s this!

Canadian banks (and other mortgage lenders) tacking on the sale of Mortgage insurance when you get a mortgage from them.  Of course this isnt just for mortgages, they do this will all types of loans.  They will sell you insurance on any and all loans.

They make it so simple, and they are great at selling you on the reasons why you need the insurance.  One little check box and a signature on the credit/mortgage application and BANG! you’ve just bought one of the worst forms of insurance!  As far as I’m concerned, a complete waste of money.  Even worst then the wasting of money… The false sense of security you get thinking your family will be taken care of if something happens to you, when in fact odds are they will get…

View original 785 more words

Originally posted on Allen LaRose, EPC, FMA, CIM, FCSI:

When the economy (and financial markets) are at it’s extremes, either doing extremely well or extremely poorly, dangerous financial products and ideas become more prevalent.

Portus, Eron Mortgage Corp, Shire International Real Estate Investments, and Arbour Energy and just a few Canadian examples. The one common denominator they share, is they all are catagorized as Exempt Market Securities.

What are Exempt Market Securities?

…when companies (issuers) sell securities such as stocks, options, or bonds, they are generally required to file a prospectus. This document contains material facts about both the issuer and the security. However, in certain cases securities can be sold without a prospectus and these investments are called exempt securities; the sale is called an exempt distribution or a private placement.

What should I know about Exempt Market Securities?

These investments are not for everyone. A prospectus is meant to ensure an investor has key facts to be…

View original 430 more words

27 Ways to Get More Sh!t Done | Greatist.

How to Get More Done

Whether we’re overwhelmed by that never-ending to-do list or simply distracted (thanks, Facebook), sometimes it feels like we just can’t get enough out of the day. Until 30-hour days are invented, follow these easy, effective tips for getting more done in the 24 we have.

 

Productivity Hero—Your Action Plan

 

1. Get enough sleep. Whoever coined the phrase “I’ll sleep when I’m dead” didn’t have all the facts straight. Not getting enough Zzz’s could hinder productivity at work, so try to get those recommended seven to nine hours of snooze time [1]!

 

2. Create routines. Make a habit of, well, sticking to habits. Schedule actions like writing emails at a certain time or hitting the gym after work, and try to do them daily. Soon that routine will happen on autopilot.

 

3. Wake up earlier. As long as you’re still able to squeeze in enough sleep, try extending the day by getting up an hour earlier—when it’s still quiet and there are fewer distractions.

 

4. Step away from the inbox. Incoming emails can be a nuisance. Make a habit to only check the inbox at certain times of the day to avoid getting sidetracked with requests and responses.

 

5. Make a daily to-do list. Stay away from huge to-do lists. Instead, create a daily list of realistic jobs to tackle, like folding laundry, scheduling a doctor’s appointment, or paying the cable bill. Break up big goals into micro-tasks, like going to a yoga class over getting six-pack abs, or writing a page over completing a thesis. Soon, the small things will add up to big accomplishments.

Read the rest…. 27 Ways to Get More Sh!t Done | Greatist.

Owning Excess is Not the Same as Experiencing Success.

Excess is Not the Same as Success

excess-is-not-success

When success is equated with excess, the ambition for excess wrecks us.” —Switchfoot, American Dream

We live in a complicated world—one that has confused excess with success.

We desire lasting significance and influence and impact, but spend most of our time chasing temporal possessions.

Consider how many of our resources are directed towards this accumulation of material goods. We spend our hours earning money. We spend our money buying products. We waste our energy caring for them. And then we punch the time clock on Monday to start the process again.

For an economy based on consumerism to thrive, goods must move. Money must be earned, money must be spent, and the demand for material possessions must continue to increase. Our economy must constantly create goods and manufacture needs.

The result is a world of excess. Even when basic physical needs are met (shelter, clothing, food), the cycle must continue. More goods must be created and more need must be manufactured.

Excess becomes the unintended goal of a consumeristic economy. (tweet that)

Somewhere, understandably, excess also became the goal of the individual. Whoever dies with the most toys wins became the reigning mantra of our culture.

This was an unfortunate turn.

Our souls long for greater accomplishments than the accumulation of material possessions. Nobody sits across the table from another human being and unequivocally declares their greatest goal is to own as much stuff as possible. We think and dream in much broader terms.

We long for something greater than material excess. Our hearts define success differently.

We desire significance. To be known as good fathers and mothers and husbands and wives and friends and citizens.

We desire influence. To use our gifts and make the world better. We want to know our lives mattered for something.

We desire freedom and opportunity. Not just for ourselves, but for others.

We desire love. To be fully known and fully accepted.

Unfortunately, too often, our unchecked pursuit of more stands in the way of this success. Excess material possessions steal our money, time, energy, and freedom. Our definition of true success gets lost in the noise.

Rediscover your greatest goals. Redefine your greatest pursuits. And refuse to equate material excess with lasting success.

Owning Excess is Not the Same as Experiencing Success.