4G Wealth Connection

Well, welcome, everyone, to this month's Virtual Cup of Coffee. Thank you very much for joining us. Really do appreciate it. And we hope you're all well. Today, I'm just going to go over a couple of things with you. Just give you a update on where we are with the 4G Wealth Connection. I'm going to go over and highlight the foundation part of the 4G Wealth Connection.

Also going to provide a global market update to you today. I'm also going to provide some year end tax planning strategies that I just want to make sure everyone's aware of. We've got a couple of articles that we can certainly provide you after this call if you are interested in more information on the actual virtual-- the market update as well as the tax planning.

So just reach out to Gail and she will be able to get that information to you. So with that, I'm going to start talking a little bit about the 4G Wealth Connection. If you were on the call last month, you got a really good overview of the plan and the strategy and the framework. And this week, I'm just-- or sorry, this month I'm just going to highlight the foundation part.

And this part of the 4G Wealth Connection is actually one of the most crucial parts of the success of setting up your 4G Wealth Connection. And I've called it Foundation. And as we all know a solid house is built on a strong foundation. And I think your wealth should be as well.

So the first part of the 4G Wealth Connection is really looking back on your journey as a family, as a couple, as a single person, whatever stage of life you're at. Looking at where you're at right now in the present. And also talking a little bit about the future generations that are to come.

So we do typically go through a seven step process when we establish that foundation. It just starts with a really good conversation with you so that we can understand what is most important to you and your family. And as we talk about your family, we even talk about things like establishing a family tree just so we can actually see the different components or the makeup of your family tree. So we have a document that is available to you after that exercise.

The second step is just talking about values-based financial planning. That's all about what you value in your family and us understanding what it is that you value. And then, we establish what we call the mission and vision statement for your family. And this document just helps us be the center point that we always go back to say, the decisions you're making today, is this congruent with the values and the vision that you have for your family?

The next step is engaging all of your professionals. Not just myself, but your lawyers, your accountants, other professionals that you work with to make decisions. We just want to make sure there's a conversation. Everyone is sitting around the table to have those discussions.

And then, again, the last thing is just bringing your family on board and having that family conference. And just letting your family know what the plan is moving forward. So that's a little bit of an introduction to the foundation of the 4G Wealth Connection.

I'm just going to move on to a global update for you. I've got a lot on here. I'm going to try to go through it briefly, but also give you enough information so that you know where we stand on some of these topics. The first thing that we see right now in the global market landscape is we're really seeing growth downshifts as expansion progresses.

And what I mean by that is the last really year we've seen the economy rebound out of this really deep recession, which is really now behind us. But some of us are seeing-- we're seeing extreme dislocations that have actually been resulting from the pandemic. And they are moderating. So these dislocations are starting to moderate, which is a good thing.

While the economy is slowing, growth remains robust and consumers are well positioned to support the expansion. Bond yields remain really low, but we are seeing those yields start to increase. And we do prefer a slight tilt to equities right now as we benefit from corporate profits that are being announced just this week starting this week.

And then, we're seeing the market now hitting all time highs again. So the rapid-- the first thing that I see is the rapid spread of the Delta variant is causing a rise in Coronavirus infections throughout the world and challenging a lot of economies. And the growth is moderating. Though we should recognize that the economy was bound to slow following this extraordinary growth that we have seen.

The other step-- the other thing that we see is, what's the outcome of the virus and some of the other risks that exist? And I think the key risk remains to-- as far as the economy goes is that the variant is twice as contagious and it's how are the governments going to contain it? And they are seeming to take a different approach than lockdowns. We're starting to see vaccine passports, vaccine mandates to try to help keep the virus at bay.

Inflation remains elevated. So that's the third thing that we're seeing. Because of the sell-off, we've actually seen inflation, and that's the price of goods increase quite substantially. We see it in shipping costs. Used cars certainly have jumped up in price. We've seen this housing price boom, computer chips. In all areas, we've seen prices increase.

We do feel that we're on the tail end of it. It's really just going to be about till the end of the year seeing where these dislocations are and where does inflation land. We are already seeing some moderation happen in the cost of goods and services.

But in the longer term, we just think there's a lot more deflationary pressures that will push inflation back down such as technological advancements, the aging population. Those are really-- they're things that will really keep the inflation rate down. So we're not overly concerned with inflation, but we know that it's a risk.

The other thing we're starting to see-- just for your information, US dollar is starting to see a downturn. We saw the US dollar have quite a run-- a lot of strength against the Canadian dollar. But we're starting to see that switch over. And we're starting to see that the US dollar is struggling a little bit against other major currencies.

And likely, the interest rate hikes that will set the US Federal Bank as well as the Canadian Banks have been talking about. The Federal Bank will likely be the last to start to raise interest rates is what we expect.

The other thing we're seeing is-- and I think this is one of the bigger concerns is a meaningful valuation risk and fixed income. And what I mean by that is interest rates on bonds are starting to increase. So over the long-term, that's a good thing. But if you own bonds right now and new bonds that are being issued are at higher interest rates, that makes your current bonds worth less.

So that is a real concern right now. And that is why we're feeling that clients should be tilted a little bit more towards equities. We still need bonds to help protect the capital in your portfolio. But we're really just trying to tilt the portfolio a little bit more to equity just so that we continue to see relative performance in the portfolio that meets your goals as well as stays ahead of the cost of living.

The last thing we're seeing in the global market update is soaring corporate profits are really extending this bull market in stocks. We are starting to see global equities-- so those are the stocks are seeing new highs. They're actually coming to record levels again. And confidence and the profits that we're seeing from corporations is very strong.

So the rapid increase in stocks has pushed the composite index, the stock market, up near 1990 tech bubbles, though although it remains considerably low below the all time peak seen back in the late 1990s.

So we are aware that we are in mid-cycle it's called. So we do need to make sure we have protection in portfolios in the event we do see any sort of near term pullback. But we really see any sort of pullback in the stock market as fairly temporary and just an opportunity possibly to invest more into areas that are weaker.

So as far as asset mix goes, in conclusion with the global market update, I really feel that we need to have 60% to 65%, at least, of your portfolio if you're in a balanced portfolio in-- tilted towards stocks. And we've got 30% to 35% in bonds. And we've also got a cash position, depending on your risk tolerance, that's somewhere between 2 and 1/2 to, say, 6%. Again, it just depends on what you're trying to accomplish in your portfolio. So I hope that helps. There is a report that is available to you. Just reach out to the office and we'll be sure that you get that.

Moving on to a strategy. And really, we're coming into November next week. And now's the time to start really thinking about some year end tax planning strategies. I have quite a few here. I'm going to just touch upon a couple of them. Tax loss selling. Many of you, I'm sure, have heard me talk about this.

Now is the time to look at your non-registered accounts and see if it makes sense to use some of your losses to offset some of the gains that we've seen from the 2020 sell off of COVID.

So really, what this strategy does is it temporarily sells your investments that are currently sitting at a loss position. We can offset those losses against future gains. And this loss can be carried forward indefinitely. It actually can also be carried back three years. So 2018, 2019, and 2020, we could carry back those losses to offset any gains that you've experienced in the past. But again, please reach out to myself or if I'm meeting with you in the short period of time we will be talking about this.

Capital gains deferral. So on the other hand, I think now's the time to really talk about do we capture more capital gains before the end of the year, or do we just defer them till the beginning of the year so that way those capital gains don't experience or really don't hit your income tax and taxes owed on those gains until May of 2023. Because they would be going into the 2022 income.

So again, we just look at your current marginal tax rate. We look at is there any realized gains that would make more sense to defer till next year? Or another reason you may want to defer capital gains is you're actually already carrying forward losses.

I'm going to-- the low income, I'm just going to skip over that one. Tax installments, just reminding people that the final payment is due on or before December 15 of 2021. So I just want to make sure that you get that in and that you're considering what your taxable income potentially will be for 2021.

Another area that I'm spending a lot of time with clients on is, what is your charitable planning or what donations do you have planned? And you just want to make sure those donations happen before December 31 of 2021 so that you can receive those significant tax credits on your income tax.

The one thing I do want to mention is if you do have securities that are at-- in a capital gain position, sometimes it makes more sense to just gift those securities in kind rather than in cash to help reduce capital gains tax. If that's something you're interested in, please call me and we'll discuss further.

Tax-free savings and contributions. Again, just make sure that gets done before the end of the year. If you're thinking about doing any sort of tax-free withdrawals, again, you just want to get that in for 2021. So that way it can get added to your 2022 contribution room.

Couple other things, RSP contributions. We just want to make sure that the deadline for 2021 is always the first 60 days of the new year. So the deadline will be March the 1st, 2022 if you're wanting to use those contributions on your 2021 tax return.

I'm going to skip over the RSP contributions if you're turning 71. If you have grandchildren or children you're saving for education RSP contributions, again, you want to make sure that is done before the end of the year.

Another big tax saving strategy is if you have mutual funds in your portfolio in a non-registered account, at this time of the year, sometimes those purchases should be deferred until the new year. Because what happens in a mutual fund is if you buy the mutual fund mid-year and the distributions are going to be paid at the end of the year, you're actually paying tax on those distributions when you've only owned the mutual fund for a short period of time.

Sometimes we just want to think about big mutual fund purchases that might be happening in non-registered accounts. Interest on family loans. Some of you might have what are called prescribed loans or spousal loans. Just as a reminder, that interest owing on those loans needs to be paid to them before January the 30th, 2022.

And the last thing I'll leave you with is if you have a business or you have accounting fees or tuition fees or even investment management fees, we just want to make sure that those get included in your 2021 year so that it can help offset any sort of taxes owing.

So there's a number of strategies that I hope help. If we haven't talked about one of them or you're interested in one of them, please let me know and we'll make sure that we go over that with you.

Last thing I want to leave you with is just an upcoming event. Next week-- or sorry, next month January 17, we've got a special guest Jacqueline Arnold. She's an executive coach and she's a founder of I heart my work. And we're going to talk a little bit of what I really am actually really intrigued with is cognitive fitness. Learning how to create and sustain mental fitness.

And I just think this will be a great conversation for you to tune into just to learn some strategies and tips that we can help maintain and sustain our mental health and fitness.

So with that, I thank you again for your time. Appreciate you joining me. And again, have a wonderful week. I'll leave you with a quote. Help others achieve their dreams and you will achieve yours, Les Brown. Thank you and have a great week.

Well, Hello and welcome. Thank you so much for taking some time out of your busy schedule to join me today. Just to learn a little bit about this unique framework. That I've designed called How To Connect Your Family, With Your Wealth.

And I'm really excited to share it with you, this fall we are launching it. And I just am so thankful that you've spent some time today, just to learn a little bit about it. And I really believe that it's going to have a positive impact on your family.

And your wealth as we elevate our services. And so the program is called, I've coined it 4G Wealth Connection. And it just provides the framework and the foundation. To build, sustain, and preserve your wealth more effectively, from generation to generation.

And I don't know about you, but we live in a very complex world. With complex family issues and dynamics. And the 4G Wealth Connection is really just intended to provide you. With a road map to navigate these complexities of managing wealth, and your financial well-being.

So with that, I'm going to get started with just a little bit of a framework of what we're going to go through. So the first part is why 4G Wealth Connection? The next thing we talk about is what is the process and the strategy.

We're going to talk about the family. And we're going to also look at the practical things that we can implement. And help your family flourish, and then what are the next steps. So with that, why 4G wealth connection?

What motivated me to lean in and develop the 4G wealth connection? And the reason I developed it was I was managing families. And wanting to solve some complex issues. And address a number of family issues, wealth issues that they were facing.

And I mean the first thing I was observing, was disjointed wealth and the state plans. So what I mean by that is new families would come on board. And their investment plans didn't really match up with their core values. Or their goals or their objectives.

And there's just a little bit of misalignment existed. And I wanted to create an efficient process. To help families link their values, with the money that they do have. I also noticed a lot of the state plans lacked purpose.

And did not address those kind of non-financial considerations. When passing on their wealth to the beneficiaries. And I just wanted to create a framework that created clarity, simplicity. And it was concise family wealth plans.

It really just brings the heart back, and the heart, and the life back into family plans. Another thing that startled me was 70% of the estate plans do not survive one generation, just think about that. 70% of estate plans that have been built don't survive one generation.

I was shocked, and I asked myself how can I help? So that my clients aren't part of this stat. The other thing I was seeing was all this conflict. And the hurt feelings among beneficiaries. I often listened to stories of how mom and dad's money toward their family apart.

Because there was just a lack of communication, and some unintentional misguided promises. And this became very unsettling to me, and I just wanted to help alleviate. Some of this pain and anguish that families were going through.

And so my goal, I often tell people, is just to try to keep the family around the Christmas dinner table. I also saw a lack of continuity of wealth management. From generation to generation, and this is a complex issue.

Because generations have much different perspectives of how they manage money. How they spend money, how they manage money. And a lot of times the family vision has just been lost.

And so my role, I believe, is to help guide. And educate all family members involved in the wealth management process. In whatever fashion I can, and whatever is appropriate for that family. The last thing that of why I built this program.

Was just the lack of skill and training, there is so much information out there. And I just feel that the next generation is starving for wisdom. And so the next generation is just not ready. And they don't have the resources in place to manage the wealth that's being passed onto them.

And I love working with young people, and I desire to help educate them. And give them the skills that's required to manage family wealth. And we can't forget they are the future. So with some of those why 4G wealth connections, to some of the things I was observing.

Let's start to talk about making the connection, or creating the connection. And I'm going to try to help you understand the whole concept. What I see a lot of times, on the first side of the equation is we have your family.

And all the dynamics and the complexities that exist with those relationships. So families today are very complex. And then the second part of the equation I see is your wealth. And so you've got your wealth and you've got to make financial decisions. That include your assets, your liabilities.

And it's all the financial decisions that get to make. But I often see these two items, like you see on the screen here, are independent of one another. And what the 4G wealth framework does, is it creates that overlap, and it connects the two.

So on your screen, you can see a Venn diagram. And I hope it helps you understand the whole concept. And so we've built a framework, and we've given people tools, we're going to give people tools. On how to make this link.

And I think it's a really important process. So let's start, where I start is it's all about your family. So I use family as an acronym, to help people remember or understand our process.

So I'm just going to take a few minutes to explain our process. And I believe the first step is building the foundation. This is a discovery process that we establish. And we look at your current situation.

Is there a family vision, mission? Or if not, let's explore with those core values are. Within the foundation step, it's the first step. And I think it's critical, we have actually seven areas. And resources to help develop that very important foundation within your family.

So, for example, we talked about the dynamics of your family. We have a family tree that we're developing. We do values based financial planning. And you've often heard this but a solid house is built on a strong foundation. And I think your wealth should be as well.

So that's the first step in the 4G wealth connection that we will take people through. The next step is your assets and your liability, or what we call the balance sheet exercise. And this stuff is just gather your present net worth.

Identifying those areas of opportunity to build, sustain, and preserve your wealth. That you've worked so hard to establish. Investment management, tax management, risk management. We have an analysis called the gap analysis.

And so what we're really doing, is we're looking at all those assets and liabilities. And we're putting these lenses, our filters, on those assets or liabilities that you do have. So that is the third step, or sorry the second step, is assets and liabilities.

The third step is members. So this is identifying the members of your family. And their generational role within the wealth plan. So we just establish what is your family's story? We have a lifeline timeline, I call it, that we've built.

To help you see what the milestones have been in the past. What they are currently, and what they are in the future. We're also going to talk a little bit about the concept of an abundant estate. That is part of this step.

The next step and the fourth step is integration. And this is where I say, this is where we're going to connect the dots. So we start with foundation, assets and liabilities, and members. Integration is about connecting your dots.

And this is really where the work happens. This is where we get our hands dirty in the action happens, within the 4G wealth connection. And we rely on our team of professionals to implement and execute the strategy.

It includes a proprietary wealth transition plan that we've developed. I'm also going to discuss with you my investment philosophy, which I call strain. And it includes meetings with your other professionals.

So that everyone on your team is rowing in the same direction. We all understand what your goals, and what your family would like to achieve. We talk about minimizing tax. And maximizing cash flow during the step of integration.

The fifth step I call legacy. This step provides you with a road map for your future family legacy. So it includes things like how we as your professionals. Are going to come alongside those you love. And help train them, and give them some tools, give them resources.

Have them be able to come to events like this, and learn about wealth management. And help them understand how to use those tools most efficiently. And the final step, is the finalizing the 4G wealth connection, which is your life plan.

And this is really the glue that brings it all together. And it finalizes the roadmap for generations to come. But it also doesn't forget about you. You probably heard the term YOLO, You Only Live Once, on this Earth.

So it's also making sure you are living the life you intended. And getting the most life out of the money that you do have. So we just provide families with that personalized forged wealth connection. And it's a living document, this document is dynamic.

It's not going to stay static, life's going to change, family members are going to change. And it just supports your past, your present, and then as well as your future. So that is the six steps that we will walk you through. That is the framework of the 4G wealth connection tool.

The other part that we think is really critical in this whole framework, is the family mission and vision. And there's a great individual, Stephen Covey, and he was the author of Seven Habits Of Highly Effective People. But he also has one called Families.

And he says a family mission statement is combined, unified expression from all family members. Of what your family is all about. What it is you really want to do, and be the principals you choose to govern your family life.

I'll give you an example of a family that we've been working with. As I've been testing and piloting this program. And this was their family vision, I am a responsible spouse and parent. I give priority to these roles, I value differences and view them as strengths.

I seek to build complementary win-win relationships with friends, and families, and business associates. To keep these relationships healthy, and to maintain a high level of trust. I make daily deposits in the emotional bank accounts of others.

It doesn't that sound great, like that is their family mission that they are living by. Another example, a little bit shorter, I will seek first to understand. For understanding is the key to finding value. And value is the basis for respect, decisions, and actions.

This should be my first act with my wife, my family, and my business. So just to give you some ideas. We really want to walk you through this, it is part of the 4G wealth connection. Because it is all about your family.

And we want to make sure that the tool is built around that mission and vision. The next step I'm going to show you. Is just illustrate and give you an idea of some of the tools that are included. The practical tools that are included in the 4G wealth connection.

The first part is the financial roadmap. Many of you we've seen this, I've been working with you on a financial roadmap. This is going to be the pipeline or the rail line. That we use to make sure we're taking action.

And we're moving through the steps of the 4G wealth connection. On the right hand side of the screen, you can see three pages. So the 4G wealth connection is a document that is customized to your family.

But I just wanted to show you the F, A and the M. And the parts of the document that we're going to build out. So this will be your own document, it'll be personalized to yourself. So I just want to give you an idea of what the document looks like. And what we're going to work through.

One of my encouragement to you today, is this whole concept of be the linchpin. And again, Stephen Covey says, "A tendency that runs through your family for generations can stop with you. You're a transition person, a link between the past and the future. And your own change can affect many, many lives downstream."

And so the linchpin, I guess my encouragement to you, is that this resonates with you. Let's be the linchpin, allow us as your professionals, to come alongside you. To [INAUDIBLE] this journey of building your 4G wealth connection.

And we would be happy, at any point to sit down with you. You will be hearing more about this over [INAUDIBLE] flesh out the components of the 4G wealth connection. But I just wanted to give you an introductory time for you just to think through the process.

And lastly, I just want to encourage you to head to my website. It's also easy to get to the 4G wealth connection. The website address is 4gwealth.com. So hopefully, fairly easy to remember again, 4gwealth.com. And we're going to develop this page, it's up and running right now.

But I'm going to be adding things to it. But other thing I'd like you to do is please call us. And if you want to start walking through this. We'd be happy to provide you with our 4G wealth connection family guide. Just to get you started.

So thank you again today for joining me. I hope that this has been encouraging. And I hope you're excited about the next steps. And I just hope you become the family linchpin. So have a wonderful day, and bye for now.

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