Family Formation & Housing

For young couples starting families, buying their first home and/or other real estate. Covers mortgages, credit cards, interest rates, children’s education savings plans, joint accounts for couples and the like.

Reasons to make Estate Planning part of your Retirement

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It’s never a bad idea to carefully organize your belongings. Discover a few important reasons to make estate planning part of your retirement process.

 

Adobe Image by Daenin

By Dan Coconate

Special to Financial Independence Hub

Retirement may feel like a distant prospect for many, but it’s never too early to start planning for your golden years.

Many people focus solely on their financial savings and investments when it comes to retirement preparations, but estate planning is another crucial element to consider. Estate planning not only protects your hard-earned assets, but it also ensures they go to your specified loved ones. Explore five essential reasons to incorporate estate planning into your retirement strategy.

Protecting your Legacy and Loved Ones

One of the main goals of estate planning is preserving your legacy after you’ve passed. A proper estate plan safeguards your assets for future generations by outlining your wishes for the distribution of your estate. This includes creating a will, designating beneficiaries for your assets, and even making provisions for minor children. By keeping your estate plan up to date, you’re setting your loved ones up for success and protecting them from legal disputes.

Avoiding Probate and Minimizing Taxes

Probate can be a long, costly, and complicated process, draining your estate’s value and leaving your loved ones in limbo. A well-crafted estate plan can help avoid probate by designating beneficiaries and establishing trusts. In addition, estate planning can minimize or eliminate the taxes your heirs will have to pay. By using smart planning strategies during retirement, such as gifting assets to heirs, you can potentially reduce estate taxes and maximize the wealth passed down to your loved ones. Continue Reading…

9 Business Leaders share best Opportunities for Wealth Accumulation

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To shed light on effective wealth-building strategies, we’ve gathered insights from nine experts in the field, including investment specialists, financial advisors, and more.

From the importance of diversifying your portfolio and investing in yourself to the consistent investment in stock indices, these professionals share their top investment opportunities and asset classes that have proven particularly effective in securing financial independence.

 

  • Diversify Your Portfolio and Invest in Yourself
  • Prioritize Exchange Traded Funds (EFTs)
  • Look into Home Ownership and 401(k) Investments
  • Make Systematic Progress Across Asset Classes
  • Generate Passive Income with a Niche Website
  • Build Wealth through Real Estate
  • Focus on Healthcare and Nutraceuticals
  • Seek Rental Property Investments
  • Be Consistent with Investment in Stock Indices

Diversify your Portfolio and Invest in Yourself

One investment opportunity that has proven particularly effective in building and securing financial independence is a diversified portfolio that includes a mix of equity, bonds, and alternative assets. 

This strategy allows for exposure to different asset classes, mitigating risk while aiming for growth. Equities provide the potential for high returns, bonds offer stability and income, and alternative assets such as real estate, commodities, or private equity can add further diversification and potentially enhance returns. 

However, it’s essential to emphasize that investing in oneself has been the best investment of all. Personal and professional development, education, and acquiring new skills have consistently yielded substantial returns over time. These investments enhance earning potential, open up new opportunities, and empower individuals to adapt to changing circumstances. — Ahmed Henane, Investment Specialist and Financial Advisor, Ameriprise Financial

Prioritize Exchange Traded Funds (EFTs)

The equity market is the single greatest wealth creator for investors. If someone has 10 years or more as their time horizon for investing, then an equity growth mutual fund or ETF (Exchange Traded Fund) is highly recommended to build wealth. 

ETFs are very similar to mutual funds. ETFs typically represent a basket of securities known as pooled investment vehicles and trade on a stock exchange like individual stocks. A growth ETF is a diversified portfolio of stocks that has capital appreciation as its primary goal, with little or no dividends. 

One such investment would be the Vanguard Growth ETF (VUG/NYSE Area). This ETF is linked to the MSCI US Prime Market Growth Index, which offers exposure to large-cap companies within the growth sector of the U.S. equity market. Investors with a longer-term horizon ought to consider the importance of growth stocks and the diversification benefits they can add to any well-balanced portfolio. — Scott Krase, Wealth Manager, Connor & Gallagher OneSource

Look into Home Ownership and 401(k) Investments

There isn’t any one asset class or investment opportunity I’d recommend over the other for the general populace. Those types of financial decisions are circumstantial and based on the needs of the client. 

Nonetheless, the two ways to “Build Wealth for Dummies” would be to purchase your home and invest in your 401(k). From a behavioral-finance perspective, the automatic contributions to these two vehicles have, more often than not, created better outcomes for clients. — Rush Imhotep, Financial Advisor, Northwestern Mutual Goodwin, Wright

Make Systematic Progress across Asset Classes

A systematic progression across multiple asset classes has been successful in developing wealth and financial freedom. A cash-generating firm provides a stable financial basis for future projects. 

Real estate investing offers passive income and property appreciation, boosting financial security. Diversifying the portfolio with equities and other assets follows, harnessing the potential for exponential growth and mitigating risk through a well-balanced mix. However, amidst this multifaceted approach, it is crucial not to overlook the most pivotal investment: oneself. 

As Warren Buffett wisely advised, “Be fearful when others are greedy and be greedy only when others are fearful.” Investing in self-improvement, education, and personal development enhances decision-making acumen and emotional resilience, providing the intellectual foundation to navigate the ever-evolving landscape of wealth accumulation.  — Galib A. Galib, Principal Investment Analyst

Generate Passive Income with a Niche Website

A few years back, an affiliate website was launched in the personal finance niche. The payoff? Consistent ad revenue and affiliate commissions with minimal oversight, essentially becoming a self-sustaining income stream.

Running a website is not as time-consuming as commonly believed. After the initial setup and content, it just needs occasional updates. Soon enough, it turned into a low-maintenance income source. Continue Reading…

5 financial tips for Back-to-School season

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By Aaron Hector, Private Wealth Advisor, CWB Wealth

Special to Financial Independence Hub

Back-to-school season can raise tough conversations about financial responsibility. For many, it causes students and families to re-evaluate both short and long-term goals in the pursuit of a post-secondary education.

The good news is that creating a plan to manage school expenses doesn’t have to be difficult:  it just requires students and families to look ahead and be realistic with budget, goals and expectations. In other words, this isn’t a process to “wing it.” Using a scenario in which you have a student enrolled or planning to enrol in a post-secondary program, here are five tips that will can help keep your finances on track this year.

Work smarter, not harder: Develop your school savings plan

It’s never too early to start saving for your child’s education. If you are a first-time education saver and starting to put money away, be sure to learn about opportunities that fit your needs and goals: whether that is saving smaller amounts over longer periods of time or leveraging options like a Tax-Free Savings Account (TFSA) or a Registered education savings plan (RESP).

For example, all new parents should start a RESP, which is a tax-sheltered investment vehicle that provides access to government grants which provide a 20% match on your contributions (up to certain limits). The first step is to speak to your advisor to learn about your options. The options are vast and more flexible than most people assume!

Leverage your resources: find out how your bank and school can help you save

To ease the burden of pricey tuition, it pays to do a bit of research on the programs, grants, or scholarships you or your child might be eligible for through your financial and post-secondary institution. The resources are out there, but it can be tough to know all that exists or how to apply for them. A good advisor can help with this part – in fact, you should be able to count on their help and resourcefulness for your entire financial journey.

Do your homework: Build a budget

Between school supplies, courses, commuting and school fees, a back-to-school shopping list can feel daunting, endless and expensive. Find savings by teaming up with your kids to identify which costs are needs versus luxuries, and then prioritize or cut as need be. Use what you’ve spent in previous years as a baseline to create a budget for the current year, adjusting for any new or increased costs you expect to come up. Because budgets can be quickly impacted for unexpected costs, consider a back-up fund. Tracking your spending, spreading out purchases, buying in bulk, reusing items and investing in supplies that are quality (not just trendy) will help you properly manage that budget for years to come.

It’s your (financial) responsibility: Manage your money with the proper mindset 

For many, there are at least two life pivotal transitions that take place after graduating high school: entering the world of post-secondary education, and (more importantly) taking on a more mature financial mindset. This is a great time to encourage kids to open their own TFSA, or even a First Home Savings Account (FHSA). While the TFSA can be used for shorter term financial goals, the FHSA should really only be used for money that is being set aside for a housing purchase within the next 15 years. Encouraging your children to form good financial habits today will prove to be very powerful over the long term.

Knock. Knock: Don’t forget to check in

You’re already likely to keep tabs on your children throughout the year to make sure they are staying on top of their laundry and homework, but some parents might forget to check-in with their own financial advisor. Meeting regularly with your advisor helps to:

  • Manage budget changes in real-time as your family’s expenses and priorities shift
  • Keep your finances on track by reviewing whether you are staying on target you’re your financial goals

The cost to attend a post-secondary institution can be massive, and the price tag can become even harder to cover without the right plan. So start early. Save for the long-term. And lean on the advice and tools that only a good financial advisor can provide. You – and your future student – will be thankful for being proactive.

To learn more about setting you and your kids up for financial success visit www.cwbwealth.com

Aaron Hector is a Private Wealth Advisor with CWB Wealth where he has been for the past 16 years. In his position he works with clients in a financial planning capacity. The majority of his clients are of an ongoing long-term nature, but he also prepares financial plans on a fee for service basis for those who are more interested in a one-time financial planning engagement. He is the Symposium Chair and board member for the Institute of Advanced Financial Planners (IAFP) and a member of the Financial Planning Association of Canada (FPAC).

 

What to consider when Selecting a Mortgage Broker

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By Matt Guenther

For Financial Independence Hub

Your long-term financial security and quality of life may significantly affect your mortgage choice, which is a crucial financial decision. The mortgage broker is a significant factor in this process. You may negotiate the complicated world of home loans with mortgage brokers, who act as an intermediary between borrowers and lenders. They can be beneficial, but not all mortgage brokers are alike. To make the best decision possible for your needs, you must consider a number of crucial aspects. This extensive guide covers everything you should consider when choosing a mortgage broker, from identifying your mortgage needs to assessing the broker’s qualifications and working methods.

Understanding your Mortgage Needs

Understanding your mortgage needs is the foundational step in the home loan journey. It entails clarifying your specific requirements and financial situation, which are instrumental in choosing the right mortgage product. First and foremost, consider the type of property you intend to purchase, as this will dictate the kind of loan you should seek. Each has unique financing options, whether it’s a single-family home, condo, or multifamily property.

Next, assess your budget and affordability. By comprehensively examining your income, expenses, and outstanding debts, you can determine the maximum monthly payment you can comfortably afford. This budgetary framework will guide your choice between fixed-rate and adjustable-rate mortgages, with fixed-rate mortgages offering stability and predictable costs. In contrast, adjustable-rate mortgages might provide lower initial rates but have the potential for future fluctuations. Moreover, the duration of your loan, the down payment amount, and your anticipated length of stay in the home should be carefully considered, as these factors play a significant role in shaping your mortgage needs and goals.

Things to Consider when Selecting a Mortgage Broker

When you’re in the market for a mortgage broker, there are several key considerations to remember. You can use these elements to determine which broker best suits your financial needs and home-buying objectives.

a) Do they have Past Reviews?

One of the best ways to assess a mortgage broker’s competence and reliability is by checking their past reviews and testimonials. Online platforms, like Yelp and Google, often feature customer reviews. Reading these reviews can provide insight into the broker’s track record. Look for brokers with consistently positive feedback and satisfied clients.

b) How many Lenders do they have Relationships with?

Mortgage brokers work as intermediaries, connecting borrowers with lenders. The more lenders a broker has relationships with, the greater your chances of finding the most favorable terms and rates. Brokers with extensive lender networks can help you access more loan options.

The number of lenders a mortgage broker has relationships with can significantly impact your loan options and terms. Here’s why it matters:

Diverse Loan Options: Brokers with a vast network of lenders can present you with a broader range of loan options. This increases the likelihood of finding a mortgage that aligns with your specific needs and financial situation.

Competitive Rates: A broker with access to multiple lenders can help you secure more competitive interest rates and terms. They can negotiate on your behalf, potentially saving you money over the life of your loan.

Specialized Lenders: If you have unique financial circumstances or require a technical loan product, a broker with connections to niche or specialized lenders is invaluable.

When discussing a broker’s lender network, please inquire about the types of lenders they work with and whether they have access to both traditional and alternative financing sources. A diverse network can provide more flexibility in finding the right loan for you.

c) Comparing Mortgage Broker Offers

Shopping around and comparing offers from various mortgage brokers is crucial. Ask for estimates from many brokers and thoroughly read the details, such as interest rates, closing expenses, and any other fees. Using this procedure, you can find a broker to give you the best overall bargain.

Request Quotes: Contact multiple mortgage brokers and request detailed quotes. Ensure the quotes include essential information such as interest rates, loan terms, closing costs, and any additional fees.

Apples-to-Apples Comparison: When comparing offers, ensure you’re comparing similar loan products. For example, compare fixed-rate offers to fixed-rate offers and adjustable-rate offers to adjustable-rate offers. Continue Reading…

The Art of Frugal Family Living: Balancing Quality and Budget

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Image Pexels/Alex Green

By Beau Peters

Special to Financial Independence Hub

Living frugally has become a necessity for many families as of late. Uncertain economic conditions and inflation may well have led you to take a long, hard look at your finances. While the situation may not necessarily be bleak, being a little more mindful about your family budget can be a wise precaution.

The good news is that living on a budget doesn’t have to mean sacrificing quality. There are steps you can take to live frugally while ensuring your family still has the support and personal enrichment they need.

Enhancing Meals

Cutting down on food spending is considered a key way to live frugally. Yet, frugal eating has something of a reputation for resulting in bland meals or lower-quality ingredients. This doesn’t have to be the case, though. It can take a little extra creativity and planning, but you can provide nutritious and delicious food options for your family without breaking the bank.

It’s important to recognize that lower-cost high-quality meals tend not to come from improvisation. You’ll find you get the best results by arranging meals in advance. Take a little time each week or even every month to make a meal plan. Start by considering the ingredients you already have at home and what additional ingredients could be added to these to make good meals. If possible, collect coupons or online codes from local stores and find ways to utilize these in your meal plan.

When you’re at the grocery store or shopping online, try to make strategic decisions. Purchase in bulk wherever possible and focus on a good selection of less-perishable items, such as canned goods, rice, and pasta, among others. This doesn’t mean you have to solely rely on these for all your meals. However, these elements do provide you with a frugal and adaptable foundation on which to build your meals.

Another important component is batch cooking and freezing. Meals such as soups and stews can be produced cost-effectively in large amounts. You can then divide these into individual meal-sized portions and freeze them. This ensures that your family has quick, nutritious, and cheap meals on days that you don’t have time to cook, rather than resorting to more expensive takeouts.

Enjoying Vacations

Living frugally shouldn’t mean that you have to sacrifice vacations. Everybody needs and deserves a break from the stresses of everyday life occasionally. Travel can also have a range of benefits for all members of the family. While you may not necessarily be able to afford luxury getaways, you can provide your family with enriching opportunities for fun and bonding. Continue Reading…