Getting to Higher Ground Financially

After years of saving and investing in money-market accounts, you may have noticed that your balance is just not growing like you wish it would. Experts advise that you look at investing in stocks and bonds. Recent years have offered enticing performance, up to five times what you earn on savings,
but not guaranteed.

So, how do you take the plunge, when your every dollar is important, and you cannot afford to risk what you have to grow?

One answer might be a stock mutual fund. It’s a form of saving in which your money will be pooled with others, and a professional manager will purchase a diversified portfolio of stocks. Each investor owns a share of the whole fund, so you get diversification you couldn’t buy with your own small investment capital.

Because the fund is managed by a professional, you should benefit from constant attention. Trading of stocks in the account is done so as to minimize the impact of commissions and other trading costs

8 Ways to Stretch the Almighty Dollar

1) Cut your car insurance by increasing your deductible.

2) Check into dropping your mortgage insurance if your balance is low enough.

3) If you’re salaried, take your next raise and direct it to an RRSP or other retirement plan.

4) Save for college by having kids earn on their savings,or open a Trust Fund account in their name at your local bank.

5) Spend twenty minutes per week staying up on your financial options.

6) Invest some of your cash in stocks, bonds, or stock mutual funds.

7) If you don’t need it, don’t buy it. If you can’t pay for it, then don’t buy it, and if you don’t understand it, don’t buy it.

8) Analyze your health care plan. You may be driving a Cadillac when a Chevrolet will do.

Selecting a Mutual Fund

Start by selecting a fund that feels right. Money magazine and other financial publications offer dozens of funds, analyzed by performance. You can call the fund directly using their toll free number, or you may wish to talk with a stock broker to get her input.

Funds are available with ‘load’ or ‘no load’ options. The ‘load’ funds have a commission of say 5% paid out of your initial deposit. The alternative is to choose ‘no load’ funds. These funds have to pay the brokers, and it is reflected in overall performance. However, most studies comparing the two find little difference in overall performance.

Different funds have different objectives. Some seek growth with a higher degree of risk and little current income. Others will seek dividend income now, but with less risk. Which is best for you? It depends on your overall objective. Do be sure to look at a minimum of five years past performance though. You are interested in long term.

How to Start a Babysitting Co-op

First, gather a list of interested parents. Invite them to an organizational meeting and discuss the following: the size of the group, membership requirements, election of officers, how often you will meet, dues needed to pay for supplies, guidelines for handling emergencies, sick children and late pick ups.

Next, you will need to establish an exchange system. Consider a ticket system. Authorize an established number of tickets per child, per hour. Determine the number of tickets the average person will need per month and distribute.

It would also be a good idea to appoint a secretary that can establish a system for personal record-keeping for each child. Include allergies, doctor’s name and number, emergency information, etc. Once, the baby-sitting co-op is in place, kick back and enjoy a night out in comfort. You deserve it.

Goal Setting for Every Type of Family

· Establish an emergency fund of cash that is equal to 3-6 months of pay.

· Start saving for college. Any little bit helps. At 7% interest, money doubles every ten years. So by starting when kids are young, you can make one dollar at their birth worth $2 at age 7, $4 at age 14, and $8 at age 21.

· Buy term life insurance for at least twice your mortgage amount. More is better, especially if you have more than one child. A $200,000 policy for a 35 year old male costs about $200 a year. Your objective is to be sure that the mortgage would be paid, that living expenses would be available for a period of transition, and there would be a downpayment made on the children’s education. Some planners suggest much more insurance, knowing that in a one income family the other parent would need time to train, seek a job, etc.

· As your children get to age 14 and beyond, you may wish to encourage after - school employment. Not just for the character building potential, but because they can earn thousands of dollars without paying federal income tax. (see your accountant)

Single / Single Parent
· Set aside three months take home pay for your emergency fund. If you are a single parent you’ll want to strive for six months on hand.

· As you accumulate savings, look for mutual funds or other alternatives to provide a higher return than money market accounts, with measured risk. If you are a single parent, decide when to start saving for college. As little as fifty dollars per month in a savings account can make a big difference. Ask your banker.

· Protect your credit rating. Perfect credit will be helpful in moving, refinancing, or even obtaining a credit line or home improvement loan, when needed. If you have recently divorced you will want to open accounts in your own name with credit cards, department stores, and credit unions.

· Check your homeowner’s insurance to be sure you have sufficient coverage to replace your belongings. “Replacement cost” coverage is preferred.

· Collect child support if you’re entitled to it. For information on your right to child support contact BC Child Support Info Line at 1-888-216-2211 or go to wwwhsd.gov.bc.ca.



Two Income Families
Buy a home or a second home, if appropriate. The wealth created though long term ownership of real estate is unmatched. The tax deductible nature of your real estate payments make for another bonus.

Use and maximize your RRSP’s, or other retirement options. As much as retirement seems far off in the future, it is coming. Anything you can do now can make a big difference in 20 to 30 years.

Empty Nesters
Maximize your savings for retirement

Consider reducing your life insurance if your mortgage is paid off.

Triple check your long-term health care insurance options while you’re still healthy.

Check your Canadian Pension Plan and/or Old Age Security benefits by filling out the proper forms. Call 1-800-277-9914 to get the form.

The 3 Most Important Factors on Your Vacation

It’s not just a real estate truth. The three most important factors are location, location, location. It’s true on your vacation.

When in Orlando, see Disney World, but what about the rest of the state? Naples and Sanibel are as close to the tropics as you can get, all within a few hours drive. The question is, will it cost $300 a night or more for the family to stay in a safe, comfortable, and ‘spacious lodging?’ Not if you go exploring.

One family found that by planning ahead and reviewing a few travel magazines they could come upon a private hideaway for less than $700 per week. When the owner asked them how long they were staying, they said that depended on the price.

He asked them how much they had to spend, and when they answered about $500, the owner agreed to let them stay for a week for just $500.

Granted it took a few phone calls and some detective work, but they were prepared to go without, do without, or do different. As a result they discovered a special place that most of us would miss.
They did their research in the local papers in the destination they wanted to visit, and they started early. If you’re a family that only has a few days and very little flexibility, then

starting early is the best bet, up to one year in advance.

If your time is short, and the trip all of a sudden appears as a possibility, try the ‘accidental tourist’ approach. The movie by the same name made the point that you should pack a big bag with everything you need, and then a small bag for essential items, then leave the big bag behind. Why? Because they have toothbrushes where you’re going, and underwear, and most everything else you’d bring in the big bag.

By keeping your options open, you give yourself the chance to take advantage of little known hideaways and special opportunities like my lucky friends.

Another idea to make your next vacation fun is to identify two or three locations, some loose parameters, and to do the most investigating you can. Then ‘roll the dice.’ Wherever you are, you ultimately are responsible for making your own fun, right?

One experienced traveler said that by planning trips up to a year in advance, the whole family could plan, anticipate, and become enthusiastic about the trip. Afterward, by sharing pictures, diaries, and favorite experiences; they were able to re-live the trip without leaving home.

Consider these ideas to help you plan a great trip, and don’t forget the video camera. Someday these memories will be priceless.

Protect Your Cash

Here are some more great ways to control your finances and keep your cash:

Join a buying club that offers deep discounts. Buy what you need, and have it on hand, saving late night trips to the expensive quick stop shops. How did they ever get by on those wagon trains to California, without a convenience store?

Remember that the Revenue Canada allows you to take a deduction for donations of clothing, furniture, and miscellaneous items. Whatever they would be worth at a thrift shop is a guide. Simply obtain a receipt, and report it on your taxes. You’ll empty the house of cast off items, get more room in your closet, and help someone less fortunate, while lowering your taxes!

Being fit may require joining a health club, but if you joined and don’t go, it’s time to decide, go or quit. As a half step, some clubs offer off peak or alternate day plans that can help cut the fat out of your budget.

Financial Checkup

Look at Money Magazine or other financial publications to get their list of low cost credit cards. Some lower fee and lower interest rate alternatives are available. They’ll help you cut your costs of credit until you can pay off those cards. Some cards carry interest rates in excess of 21%, and require a minimum payment so low that it could take more than 10 years to repay the balance in full. Begin to double your monthly payments on the credit cards with the highest balances.

Open an RRSP or other retirement account to allow you to build your retirement nest egg. If you already have an account, analyze your investments to be sure you’re in the right place for your risk preference, and your goals. An annual checkup is in order.

If only someone had given us a thousand dollars at birth, and we had kept it invested at 12% (high) for 65 years (long time), we could retire a millionaire. It’s true, and it’s not too late. Pick some of these ideas and take action now!

Sell Your Home or Become a Landlord

Renting your home out may seem like a great alternative to selling at a lower price than expected, but make sure you consider the financial implications.

If the main idea in renting the house is to move now and sell later, be sure to factor in the costs which may occur when reconditioning the rental home for sale as a residence. Chances are the aggravation of converting your home to a rental will exceed any contribution to costs or profits.

Most importantly, keep in mind that being a landlord can be difficult. Tenants will demand that repairs and home maintenance be kept up with in a timely manner. Expenses can be quite substantial, so be prepared with funds to cover them. Feel free to ask me for more information on sales or rental, anytime!

Controling Your Finances with a Plan

For most of us the first step to a bright future is to get control of our finances, and to use a plan to achieve our key objectives. As we get busier, and more transactions are electronic, by mail, by phone, or by ATM, we can lose track of where we are on the financial road map.

This list of suggested activities can help you get back in the seat on the way to your financial destination.

Like a diet requires you keep track of what you eat, in order to cut the fat, you must also track your spending for a month to see where it all goes. This will highlight areas to be targeted for savings.

Create a plan to save 10% off the top of your earnings. “Pay yourself first,” and “part of all I earn is mine to keep,” are key phrases to remind you that you’re entitled to save now for your future.

Put together all your insurance statements and policies and offer them to one or two reputable agents in order to either update coverage, or reduce your costs. Many of us carry too much insurance, in some areas, while we’re dangerously underinsured in others.

Driving a car that is getting older and less valuable, without adjusting your coverage could be an expensive mistake.

Record Keeping Responsibilities

Here are a few ideas for accounting for the items inside your home, as well as the home itself:

Make a video or photo record and retain receipts for any specific items that are valuable or unique. Remember to add those items, especially jewelry, computer equipment, stereos, etc. to your insurance policy as specifically scheduled items. The additional cost of the insurance is low, and the peace of mind is worth every penny.

You may wish to organize the information about personal property onto a form. This form and the video or photo record will be a perfect partner, if needed, to answer questions in the event of a loss. Organize this information before you experience a loss.

It is important to keep lease or mortgage documents, as well as receipts for all home improvements in a secure place. Improvements are defined as those things which add value, extend the useful life, or adapt to a new use. Replacing a roof, building a fence or deck, or adding a garage are all examples of improvements. By retaining this information you will be able to show future buyers a history of your home.

If you are thinking of adding on to your home, moving up, or moving down, please call us A.S.A.P. Our experience can help you save time and money.

Keeping your important papers, documents and insurance policies in a convenient location, which is known to you, your spouse, and your loved ones, will save time and frustration. You could save thousands of dollars in the event of an emergency, death, or illness.





Here’s a list of the items the organized homeowner should keep together, in a fireproof file cabinet, safe, or strongbox.

· Bank information: Your account numbers, loan documents, statements, and deposits, as well as your most recent canceled checks.
· Car Documents: License, registration, insurance policy, extended warranty, repairs, and other key information.
· Education Records: Official transcripts, report cards, test scores for each student.
· Insurance Policies: Life, homeowners, health, disability, and any others.
· Tax Returns: Revenue Canada suggests you keep your tax returns for three to five years, just in case.
· Official Documents: Birth Certificates, passports, legal papers, deeds, and wills should probably be kept in a safe deposit box.

However, you may wish to keep copies on file at home, with instructions as to their location attached to the file.