Archive for the ‘articles’ Category

First and foremost is the BC Provincial Government’s Guide of Seniors

bcsenior

More specific to the Maple Ridge-Pitt Meadows area is the Seniors’ Network Guide

katzie

investrightCSA

Two great documents available online every senior should read.  One about the dangers of private placement investments from investright.org.  The other from Canadian Securities Administrators about frauds and scams

As always, I am welling to address any questions

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WHY CI IS ESSENTIAL TO RRSP PLANNING

Posted: September 13, 2013 in articles

A missing piece of a financial plan is all it could take to lose years and years of Registered Retirement Savings Plan(RRSP) growth, not to mention the comfortable retirement you’ve dreamt about.

It happened to Richard and Julia. Richard, 43 and Julia, 39 have two young children, a house, a mortgage and dreams for retirement. They have been saving since they were married and jointly managed to accumulate $150,000 in RRSPs. They have life insurance in place that would ensure their family is taken care of should anything happen to either one of them.

Then Julia is diagnosed with breast cancer. She takes immediate leave from work to focus on treatment and recovery. Her treatment is aggressive and will require that she be off work for at least 6 – 8 months. Richard now becomes the primary caregiver and his own income suffers as well. Julia’s doctors have recommended a non-insured treatment to help her recovery, but the money is just not there. Their RRSPs are their only answer.

The Next question is, will they have enough?

No, they will not have enough.

Richard and Julia have calculated and they think they will need $95,000. With their marginal tax rate of 46%, even if they withdraw their full $150,000 in RRSPs, they will only net $81,000 after tax, leaving them with no savings and a shortfall of nearly $14,000.

A critical illness can have a devastating effect on your finances. The most thorough retirement income projections typically do not make allowances for the additional costs of living involved when someone suffers from a critical illness such as cancer or heart attack. By depleting their RRSPs, the effect on Richard and Julia’s financial and retirement plans is devastating. In addition, the long-term loss of compounded returns could be enormous.

The right insurance coverage can protect your savings and the retirement lifestyle of your dreams. Critical Illness Insurance provides a tax-free lump sum cash benefit upon diagnosis of one of up to critical illnesses and life-altering conditions including heart attack and cancer. You can also protect your premiums. With a properly structured policy if you do not become ill, you could receive all of your premiums back. That’s right, you can have this valuable coverage plus receive all premiums paid into the policy if you do not incur a critical Illness.

Critical Illness insurance is an important part of your overall financial plan. You can either take the chance and hope that a life-altering illness will not deplete your savings or income, or protect yourself.

via Serendipity and Spice: 8 Plants to Repel Bugs, Insects, and Pests.

I don’t know about you but I HATE bugs!  They just freak me out!  It really doesn’t matter what kind of bug- roaches, silverfish, spiders, mosquitoes  fleas, beetles…. You name it and I HATE it!  Especially bed bugs!  I’ve never experienced bed bugs before but I was watching 20/20 awhile back and they were doing some kind of expose on bed bugs in hotels and I’ve been freaked out ever since!  The mere thought of them makes my skin crawl!!!!

Since we had such a mild winter (here in Georgia anyway) everyone is saying how horrible the bugs are going to be this summer because nothing died off during the winter.  So now I’m super freaked out and have been looking into natural remedies or repellents for those nasty creepy crawlers and stingy sneaky fliers.  Last year I just had a bottle of Raid handy… but this year I have the little man and I really don’t want to be spraying chemicals around him.

SO, HERE ARE THE TOP PLANTS THAT EVERY HOUSE SHOULD HAVE TO WARD OFF PESTS:

1. Mint
 It not only smells nice but it keeps away ants and mice!  Crush some to release the fragrance and it’ll run off any strays that come your way.
2. Bay Leaves
Add some to the mixture and you’ll get rid of gruesome roaches too!
3. Lemongrass
To keep away those flying pesky mosquitoes and bees!
4. Basil
Yummy and keeps those annoying flies at bay!!
5. Geraniums
They not only add a boost of colour but they keep out Japanese beetles!
6. Catnip!
Yes, that stuff that makes your cat act all crazy…. Supposedly wards off a long list of bugs including mosquitoes and flies.
7. Pyrethrum Chrysanthemums- AKA: Mums specifically the ones that look like Daisies!
These are the be all end all of pests!  According to wiki.answers these cute little flowers repel: Roaches, fleas, ticks, bedbugs, lice, silverfish, ants, and so much more!

 
 
 
via Serendipity and Spice: 8 Plants to Repel Bugs, Insects, and Pests.

What is critical illness insurance?

Answer: Critical illness insurance is a form of health insurance that provides a lump-sum payment should you become seriously ill.

What are the types of illnesses covered by critical illness insurance?

Answer: Although they differ from company to company, typical illnesses and diseases covered by critical illness insurance may include:

  1. cancer
  2. heart attack
  3. stroke
  4. blindness
  5. Alzheimer’s
  6. multiple sclerosis
  7. organ transplants
  8. kidney failure
  9. paralysis

Coverage can also vary according to the degree of severity of, or conditions associated with, an illness or disease. For example, if you are diagnosed with a type of cancer that is treatable and that results in minimal “down time”, you may not be eligible to make a claim. Coverage cannot be purchased for a pre-existing condition or illness. It is important to ask your insurance representative to provide you with a complete explanation of your coverage.

Do I need critical illness insurance?

Answer: Almost certainly, Yes! The risk of suffering a critical illness or disability is unbelievably high.  Calculate your risk here.  You should also consider your personal circumstances and the added financial strain that could be brought about by dealing with a serious illness or disease. Public and private health insurance plans typically do not provide coverage for day-to-day living expenses such as travel to and from treatments, home care and child care.

How much does it cost?

Answer: Generally, the younger and healthier you are, the lower the premium (cost). However, the cost varies depending on your age, medical condition, the amount of coverage, the number of illnesses covered by the policy, and the insurance company. When shopping for a critical illness plan, you should consider your income, financial obligations, dependants  and health care needs.

How can I make a claim?

Answer:You can make a claim if a physician, licensed to practice medicine in Canada and specializing in your particular illness, diagnoses you with a critical illness or disease covered by your policy. Generally, a lump-sum benefit payment will be made to you 30 days after the claim has been approved. There are no restrictions on how you use the money. Once your claim is paid, your critical illness insurance policy ceases.

What if I never make a claim?

Answer: If you die for a reason not covered by the critical illness policy, the premiums you paid may be refunded to your named beneficiary. Some plans will return the premium or a portion of the premiums paid during the life of the policy if the policy matures and no claim has been paid.

Is long-term care insurance the same as critical illness insurance?

Answer: No. Long-term care insurance provides for personal care on a long-term basis if you need supervision or assistance with daily living activities due to a chronic illness, disabling condition or cognitive impairment. Long-term care policies generally reimburse, up to a specified limit, the expenses incurred for various types of care, such as nursing home or home health care; or they pay a pre-determined benefit amount on a daily or monthly basis.

Is disability insurance the same as critical illness insurance?

Answer: No. Disability insurance, also known as “income replacement” insurance, provides a monthly income replacement benefit if you become disabled and can no longer perform the normal duties of your work. Generally, the benefit is limited to a percentage of your regular income and ceases once you earn an income or you no longer meet the definition of disability in the contract.  Unlike critical illness insurance which provides the full policy benefit in a lump sum payment on diagnosis of a critical illness, long-term disability policies may have a waiting period from the onset of disability. Unlike critical illness benefits, long-term disability benefits may be affected by other income you receive or by your full recovery from the illness.

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7 COMMON HOME SECURITY MISTAKES

If you and the guy who wants to steal your television sat down to shoot the breeze, what would you ask him?

The chance to pick a burglar’s brain could certainly give you some ideas for home security upgrades, but it’s not a very common opportunity. So, we created some fictional burglar monologues (based on real research). Listen up, because over two million burglaries occur each year in the United States (one every 15 seconds)! Here are a few things your neighborhood thief doesn’t want you to know.

If you’re already convinced that your home could use some extra security, here are seven effective ways to protect your house:

1. Ladders are awesome.

Every time I see a ladder hiding behind a shed or leaning against a house, my heart does a little jig. Do you know how easy it is to crawl through a second-story window with a ladder? Plus, you probably aren’t stressed about locking your second-story window when your front door is dead-bolted.

Takeaway: Keep all of your windows and doors locked tight when you’re out of the house, and hide the ladder in your garage or in a shed when it’s not in use!

2. Your trash reads like a catalog.

Where did your brand-new flat screen’s box go? That’s right – it went in the trash. So I can dig through your trash and find out exactly what’s in your house. It’s easy as pie to know which homes to hit up – especially around the holidays!

Takeaway: Never leave boxes of expensive items on the curb. If possible, take them directly to a trash center.

3. Newspaper piles are a dead giveaway.

Who lets newspapers pile up and their mailbox overflow? People on vacay, that’s who. A house that’s obviously empty is a house I’m going to think pretty seriously about robbing.

Takeaway: Before you leave for vacation, call the post office and ask to them to hold your mail during the dates that you’re away. You’ll be able to pick it up when you’re back in town. If you enjoy cracking open a newspaper in the morning and have The Times delivered every day, call the paper and have it halted while you’re gone.

4. Untrimmed bushes and dark areas are perfect hiding spots.

The more overgrown your bushes are, the more likely I’ll want to hide in them – especially if they’re near windows! No motion detectors to set off exterior lights? Even better! That way, I can case your home and you won’t notice me.

Takeaway: Make sure your bushes and trees are neatly trimmed so they don’t double as hiding spots! It may also be worth installing outdoor motion activated lightnear exterior doors and windows for some added security.

5. Nothing beats an alarm system with a view.

Whether it’s through a window or from a reflection, I really love being able to see your alarm system. That way, I can tell if it’s armed and know exactly what I’m getting myself into. You’d be surprised how many mirrors have helped me out!

Takeaway: If your alarm system is visible through a window, make sure you use blinds or shades to cover it up when you leave or go to sleep. If it’s noticeable in a mirror’s reflection, move that mirror!

6. Burglars use Facebook, too.

When you brag about your awesome trip to Cancun on Facebook, I may not like your status, but I definitely like the fact that I know your house is empty!

Takeaway: It’s tempting to post images of your amazing trip in real time, or update your status about how much fun you’re having in a foreign country, but it’s safer to wait until after you’ve returned home.

7. Dark houses attract bad people.

If a house’s lights are off for several days in a row, it’s a dead giveaway that people aren’t home. I like to give it a few days just in case, but if no lights come on, I get ready to roll!

Takeaway: To make your house seem lived in, install a timer in some rooms that will turn lights on and off during different times of the day. Burglars know that it’s common to leave lights on, so they will be more cautious if they see changing lights. If you need to buy a timer, we like this 7-day random vacation timer by GE (it’s less than $20).

10 Tips for Shopping at a Thrift

One of the best ways to live a frugal lifestyle is to make shopping at a thrift store part of your regular shopping regimen. Thrift stores feature items that have been used before. This can include anything from dishes to clothing to books to furniture to toys. These used items are often in reasonably good condition, and can be found at very low prices. Shopping at a thrift store can be a great way to save money, while acquiring items that you need.

Here are 10 tips that can help you better shop at a thrift store:

  1. Show up on stocking days: Many thrift stores have a particular day of the week that they put out new merchandise. Find out what that day is, and show up then to get first pick of the latest deals.
  2. Search for quality: This is especially true with clothing. You might be surprised at the name brand, high quality items some people are happy to part with. Keep your eyes open for items you know are of good quality.
  3. Make a list: You want to be prepared with a list. Even though impulse buying at the thrift store is probably not as bad as when you are paying full price on an impulse purchase, those little surprises can add up. Be sure that you know what you want, and make a plan for what to buy.
  4. Return until you find what you want: Don’t assume that the thrift store is a bust if you don’t find what you are looking for on your first excursion. Check back over time, looking for what you want. Chances are that, eventually, you will find what you are looking for.
  5. Watch for sales: Even thrift stores have sales. Some offer “fill a bag” promotions, “clearance” sales at the end of the season and other sales. This is a great way find even deeper discounts on thrift store merchandise. And, while thrift store shopping works well without coupons, you can also look for thrift store coupons for bigger savings.
  6. Shop during the week: Weekend shoppers are out in force from Friday evening until Sunday evening. Avoid the crowds and avoid competition for the best finds by visiting the thrift store during the week.
  7. Ask about store credit: Some thrift stores only accept donations, but others also accept consignment items and will give you store credit for what you bring in. Find out about the policies at your local second hand store of choice. If you can get store credit for what you bring in, that can be a great way to save a little more.
  8. Be careful about overdoing it: It can be very tempting to go a little crazy at the thrift store, buying several things at once. Stick to your plan, though. If you only need three dress shirts, don’t go nuts and buy 10 or 11. Remember that a frugal lifestyle is about moderation.
  9. Plan to take awhile: A trip to the thrift store is likely to take awhile, since you will probably have to dig around a little. Be prepared to take around an hour — or more. This means that perhaps you leave the kids at home for a serious trip to the thrift store.
  10. Don’t forget to donate!: Finally, you want the thrift store to keep going. If if you don’t get store credit, you should still donate some of your unneeded items as well. Keep the cycle going, and provide great deals for others, just as they are providing them for you.

via 10 Tips for Shopping at a Thrift Store.

Alter ego trust can help protect your assets.

 

A will is the traditional way to distribute your assets upon your death.

 

But it may not be the best estate planning tool for you. Depending on your circumstances, an alter ego trust or joint spousal or partner trust could be a better choice.

 

When assets pass under a will, probate fees must be paid. In B.C., where probate taxes are the second highest in Canada (1.4 per cent of estate values over $50,000 — about $14,000 per $1 million of estate value), these can be hefty.

 

Also, a child or spouse (including a common-law spouse) unhappy with their share of the estate can attack your will under the Wills Variation Act. They can ask the court to change the terms of the will. If the court concludes that your will doesn’t adequately provide for the proper maintenance and support of the disgruntled claimant, the court can vary your will and order whatever distribution it thinks is “adequate, just and equitable.”

 

This is where trusts can be useful. Assets in a trust don’t form part of your estate (the trust owns the assets) and therefore do not pass under your will. This means no probate fees are payable in relation to these assets, and the assets are not subject to claims under the Wills Variation Act.

 

But one of the problems in the past with setting up a trust that takes effect while you’re still alive is that it generally triggered a tax liability for any accrued capital gains on property transferred to the trust (other than your principal residence, which is exempt from capital gains tax).

 

Enter alter ego trusts and joint spousal or partner trusts. Since 2000, you have had the option of creating an alter ego or joint spousal trust without attracting any immediate tax consequences. You can transfer property to an alter ego trust or joint spousal or partner trust without triggering any capital gains tax.

 

You must be 65 or older to set up one of these trusts. With a joint spousal or partner trust, your property and assets are transferred into the trust, but you still have the use of your assets and continue to receive income on the trust assets. On your death, the assets pass to your spouse or partner according to the terms of the trust. An alter ego trust is similar but is for people who don’t have a spouse. After your death, the assets pass to the named trust beneficiaries.

 

Read the rest of the article at canada.com Alter ego trust can help protect your assets.

H&R Block has offered their top 10 tax myths:

Maternity leave income is not taxable. “You are required to report your EI benefits as income. In most cases, Service Canada withholds less than the lowest tax rate so you may have tax obligations at the end of the year.

RRSP contributions do not have to be reported if I do not use the deduction. “Even if you are not claiming a deduction for the contributions you made in the year, you are still required to record the fact that you made them. So all your contributions from March 2, 2012 until March 1, 2013 should be recorded on your 2012 tax return.”

Tips are not considered income. “Servers and others working in the hospitality industry are required to record and report their tips on their tax return. For servers, tips may be as much as 200-400 per cent of their income.”

Students get refunds on their tuition. “In order to receive a tax refund, you need to have overpaid your income tax during the year. If a student does not have taxable income, they cannot use their tuition and education credits on their return. They have the option to transfer up to $5,000 to a parent, grandparent or spouse or they can carry forward credits to use in future year.”

Mothers are required to claim the children first. “The lower income spouse is required to claim childcare expenses whether it is the mother or father. Either parent can claim the child tax credit.”

I earned less than $10,000 so I do not have to file a tax return. “Even if you did not earn more than the $10,822 personal amount, filing a tax return may trigger benefits like the quarterly GST/HST payment. And if you had tax withheld, you should receive a refund.”

I can claim a flat rate amount for my business mileage. “Self-employed Canadians are required to keep a logbook to calculate the auto expenses for their business.”

Child support is a tax deduction. “Unless your agreement is dated before May 1, 1997, child support payments are reported on your tax return but they are not a deduction or included in income.”

If I work outside of the country, I do not need to file a tax return. “The Canadian tax system is based on residency. If you are emigrating, you should indicate your date of exit on your last tax return. If you are working outside of the country but have substantial residential ties to Canada still, you will be required to file a Canadian tax return.”

Mortgage interest is a tax deduction. “Only self-employed Canadians who work from home are allowed to claim a percentage of their mortgage insurance as a business expense. The tax benefit of owning a home comes when you sell. Every Canadian receives a capital gains exemption on the sales of their principal residence.”

http://www.hrblock.ca/documents/TS13%20Media%20Advisory%20Tax%20Myths.pdf

 

John Kay On The Market

Prof. Kay doesn’t pull any punches when discussing the worst flaws of the market, the financial sector or the euro zone.

On the often-expressed industry view that people just need to better understand how the financial sector works:

“I do not know what is under the bonnet of my car and I do not want to know. … Nor do I want to read large volumes of disclosures about what’s under the bonnet of my car every time I sit behind the wheel. What I want is the confidence … that the combination of a modest amount of regulation together with a manufacturer’s concern for his reputation means that … I can expect that most of the time it will do more or less what I want it to do. That’s very far from being the kind of comfort which people can today bring to their purchase of financial services.”

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