Quote of the Day – 1/10/2017


By all means let us assist the poorer people as much as we can in their own efforts to build up their lives and to raise their standards of living. An international authority can be very just and contribute enormously to economic prosperity if it merely keeps order and creates conditions in which the people can develop their own life; but it is impossible to be just or to let people live their own life if the central authority doles out raw materials and allocates markets, if every spontaneous effort has to be “approved” and nothing can be done without the sanction of the central authority. – F.A. Hayek; The Road to Serfdom

When You Don’t Know What You Don’t Know


“Thanks for offering to answer my questions but I don’t feel like I even know enough to know what I should ask. I’d rather not waste your time.”

That was how a perspective client started a conversation with me the other day. We have been personal acquaintances for about five years now and a few weeks ago when I had advertised my financial planning seminar she had wanted to come but couldn’t make it work with her schedule. I causally offered to meet for coffee sometime and answer her questions directly. The next time we spoke, a few weeks later, that’s what she said.

The sentiment expressed in this comment is all too common. It comes from a place of self deprecation and humility but also a false belief that professional advice is somehow reserved only for the “elite”. Nothing could be further from the truth.

statsStudies have shown that of households who consult with a Financial Advisor 60% feel prepared for a financial emergency, 65% feel they could manage through tough economic times and 73% are confident their families will be taken care of if they died.

So I said to my acquaintance and perspective client;

“I am actually glad you feel that way, the entire advice industry is based on the assumption that we don’t know what we don’t know so I start by asking you a series of questions to help frame your goals and dreams. The fact is you do know what questions you want to ask, you just don’t have enough confidence to ask them yet. My first task is to help you see that your questions have merit so you feel comfortable asking them.”

We’re meeting next week.

The fact is life can be complicated. When you hesitate to ask questions about things you don’t understand it makes things even more complicated than they need to be. Back in college I had a professor who used to say that the only stupid question is the one you don’t ask. When you don’t know what you don’t know you need to ask questions, even if you don’t quite know what to ask.

I’m in the advice industry and my best advice, regardless of the situation boils down to one thing – Ask Questions.

anglesA good Financial Advisor will provide integrated advice that will ensure your security is viewed from every angle. From tax advantages and protection from market volatility to personal risk management and paying attention to debt, a sound financial plan gives your financial security the attention it deserves. By guiding you through a goal setting process your advisor it will start to answer questions you might not even know enough to ask.

Don’t ever feel like you don’t know enough to talk to an expert. That’s what we are here for.

Lauren C. Sheil is a serial entrepreneur who has been in business for over 25 years. He has operated farming operations, a recording studio and a music manufacturing plant, has written 3 books on Economics and Christian Ethics and presented his ideas to business owners and ministry leaders from all over the world. His latest book “Meekoethics: What Happens When Life Gets Messy and the Rules Aren’t Enough” is available on Amazon.com.

Mr. Sheil is currently a Financial Security Advisor and Business Planning Specialist with one of Canada’s premier financial planning organizations.  He is passionate about helping entrepreneurs to live life to the fullest while Eliminating Debt, Building Wealth and Leaving a Legacy.  

He can be reached at themeekonomicsproject@gmail.com or by calling 613-295-4141.

 

Save

Save

Save

Save

Save

Save

Blessed Are Those Who Wield Soft Power


softpowerPolitical values like democracy and human rights can be powerful sources of attraction, but it is not enough just to proclaim them. Joseph S. Nye Jr; Soft Power, The Means to Success in World Politics

It is not my usual practice to write a review of a book that I have not yet finished. However; the events of the past several weeks and months leading up to the “peaceful” transition of power in the United States have compelled me to break with my self-imposed tradition.

Over the Christmas break I have been reading through Joseph Nye’s “Soft Power” which was originally published in 2004 at the end of the first term of President George W. Bush. I can’t help but notice a stern warning in these pages against the type of world we may be entering into in the next few weeks. We are standing a crossroads in history in which a populist leader threatens to lead his nation, and by extension the entire world, into a dark age of intolerance, unilateralism and regression the likes of which we have never seen before.

The policies of the Trump administration could set America’s social progress back 50 years and all but destroy their international reputation as an open, welcoming, tolerant and democratic society. As a result the world’s only military superpower could find itself losing key international policy debates in such economically significant and security related decisions as environmental protectionism, nuclear proliferation and terrorist financing to the interests of Russia, China, the European Union and non-state actors like ISIL and OPEC.

This simply cannot be allowed to happen.

flagworldThe term “Soft Power” was coined by Joseph Nye in 1990 in his book “Bound to Lead: The Changing Nature of American Power”. Mr. Nye is the former dean of the John F. Kennedy School of Government at Harvard, the former Assistant Secretary of Defense for International Affairs under President Bill Clinton and is currently a University Distinguished Service Professor at Harvard. His credentials in international affairs are beyond reproach. He actually developed the concept of Soft Power over a long carrier in academics and government which began in the late 1970s but only started using the term extensively after it first appeared in the aforementioned book.

He wrote:

When one country gets other countries to want what it wants this might be called co-optive or soft power in contrast with the hard or command power of ordering others to do what it wants.

Ever since its founding the United States has enjoyed a large proportion of what is now known as soft power. The ideals of democracy, liberty and justice that undergird the US Constitution have been beacons of hope for hundreds of millions of people world-wide for nearly 200 years. It is this soft power, more so than its military or economic might that has helped transform the world from a collection of feudal empires into a largely democratic and capitalist one. American soft power, the attractiveness of democracy and an open society, far more so than the threat of nuclear annihilation or economic isolation is what eventually ended the Cold War.

eagleBut the tide is changing and I fear that a Trump administration and other populist movements around the world are only going to serve to accelerate this change, diminish American influence and usher in an era of instability and violence similar to that which caused two World Wars during the first half of the last century.

The countries that are likely to be more attractive and gain soft power in the information age are those with multiple channels of communication that help to frame issues; whose dominant culture and ideas are closer to prevailing global norms (which now emphasize liberalism, pluralism, and autonomy); and whose credibility is enhanced by their domestic and international values and policies… To the extent that official policies at home and abroad are consistent with democracy, human rights, openness, and respect for the opinions of others, America will benefit from the trends of this global information age. But there is a danger that the United States may obscure the deeper message of its values through arrogance. – Joseph S. Nye Jr; Soft Power, The Means to Success in World Politics

Professor Nye wrote those words in 2004, at a time when America was going it alone in an unpopular war with Iraq. At that time when the world looked at America they saw a country that, while it may have started to betray some its founding values in the name of security against religious extremists it was at least consistent in its application of those values at home. Any damage caused to America’s soft power was limited to its politicians and foreign policy. Today I am afraid that the hypocrisy of the Iraq war pales in comparison to the hypocrisy apparent in Trump’s domestic policy. These policies have the potential to betray the very founding principles of “life, liberty and justice for all.”

Just as the Cold War was won through diplomacy and the effective wielding of soft power, I fear that the next war, cold or hot, will be lost through the ignorance, arrogance and cultural ineptitude of populist movements that have no regard for the soft power of liberalism and pluralism that has served progress so well for so long.

Lauren C. Sheil is a serial entrepreneur who has been in business for over 25 years. He has operated farming operations, a recording studio and a music manufacturing plant, has written 3 books on Economics and Christian Ethics and presented his ideas to business owners and ministry leaders from all over the world. His latest book “Meekoethics: What Happens When Life Gets Messy and the Rules Aren’t Enough” is available on Amazon.com.

Mr. Sheil is currently a Financial Security Advisor and Business Planning Specialist with one of Canada’s premier financial planning organizations.  He is passionate about helping entrepreneurs to live life to the fullest while Eliminating Debt, Building Wealth and Leaving a Legacy.  

He can be reached at themeekonomicsporject@gmail.com or by calling 613-295-4141.

Save

Save

Save

Save

Save

Save

Five Smart Money Moves for the first 100 days of 2017


happynewyearA New Year will dawn in just over 3 more days. For me and many others who are close to me, the fresh start that a new year brings can’t come soon enough. Every year has its trials and triumphs but it seems that 2016 has had more than its fair share of the former and not enough of the latter. So I thought it was time to write about some strategic moves we can all make with our money in the coming year to make 2017 better than 2016 and set us up for many more good years in come.

With a new president in the United States we will likely be hearing a lot about the first 100 days of the new administration. Like a game of chess, the first few opening moves of a new administration are said to set the tone for the entire four year term. I like the idea of the first 100 days. It is long enough to measure and short enough not to drag on and on. The following are all moves you can make in the first 100 days of 2017 and set the tone for the rest of the year.

1 – Pay off consumer debt

Consumer debt (credit cards, personal loans, lines of credit etc) usually comes with a higher interest rate than your mortgage so that’s the best place to start. As of the last full accounting in 2015 Canadians were carrying an average of $21,164 in non-mortgage debt.

I’ve written at length in the past about various debt repayment strategies like the Debt Snowball and Debt Avalanche. Whether you need a series of small early victories or just want to get rid of your highest interest debt first doesn’t really matter. The key to both strategies is that once you have paid something off you roll the amount you’ve been paying over to the next one on the list and pick up momentum as you go, like rolling a ball down a hill.

Think of your debt repayment as an investment. Every dollar you pay toward a debt with a 19% interest rate is like earning that same 19% on your investments. At the end of the day it’s all about your net worth anyway and by reducing that debt you are increasing your net worth faster than you would be if you put that money toward an investment, even if you achieve an almost unheard of 12-15% on your money.

2 – Pay down your mortgagemortgage

Your biggest debt is likely your mortgage. The average mortgage in Canada is about $175,000. If your mortgage allows for it, consider putting a lump sum directly toward the principle. This could save you thousands in interest over the course of the term.

Alternatively, if you have at least 20% equity in your home you might also consider renegotiating or transferring your mortgage to a different financial institution and rolling some of your higher interest debt into the principle. Many financial institutions offer these kinds of mortgage consolidations that, even when you consider penalties to get out of your existing mortgages could save you thousands per year.

3 – Save for retirement

Money inside a Registered Retirement Savings Plan (RRSP) can grow more quickly than non-registered money because you don’t have to pay taxes on any growth until you make withdrawals. The theory is that when you do finally make those withdrawals you will be in a lower tax bracket than you were when you made the deposits so you will always pay less tax than if you hadn’t registered the money in the first place. Not to mention the fact that you will get a tax deduction based in the amount of your RRSP contribution.

This is an important move for not just the first 100 days of the year but if you make the contribution within the first 60 days of the year (prior to March 1) you can report it on your 2016 tax return.

4 – Save for a short-term goal

shortermgoalThere are lots of things we can consider as a short-term goal; saving for a down payment on a house, a new car, vacation or building up an emergency fund. Open a Tax-Free Savings Account (TFSA) for these types of things. All investment growth in a TFSA is tax-free and can be withdrawn at any time without incurring any taxes. And the best feature of these accounts is that you can withdraw money one year and put it back the next year without losing any contribution room.

As of January 1 every Canadian over 18 will receive an additional $5,500 of contribution room, bringing the total available room depending on your age to $52,000.

5 – Save for education

If you have children that are planning on going on to post-secondary education there is no better investment vehicle than the Registered Education Savings Plan (RESP). It is essentially guaranteed free money. Depending on your income level the government will add up to 20% to your investment. Consider an average investment earning 5% on its own plus the 20% in government grants and there is no other investment on the planet where you could reasonably expect a 25% annual return. Best of all the money is taxed at the student’s income rate when it is withdrawn, which should be next to nothing.

With these early moves you can set the tone for a successful 2017. For more information on how to implement these and other strategies feel free to contact me any time.

Mr. Lauren C. Sheil is a serial entrepreneur who has been in business for over 20 years.  He is currently a Financial Security Advisor with one of Canada’s premier financial planning organizations.  He holds dual licenses from the Financial Services Commission of Ontario (FSCO) for Life, Disability and Critical Illnesses Insurance and the Mutual Fund Dealers Association of Canada (MFDA) for personal investments.  He is passionate about helping people to live life to the fullest while Eliminating Debt, Building Wealth and Leaving a Legacy.  

He can be reached at themeekonomicsporject@gmail.com or by calling 613-295-4141.

Save

Save

Are You A Survivor?


survivorLast night my wife and I watched the season finale of Survivor. I know we are a bit late to the party on this one but we tend to load up our PVR and binge watch things over a few days rather than invest an hour or two a week for several months. We miss the boat on some of the water cooler talk that way but in the long run it saves us lots of time so it works for us.

Usually when I watch Survivor I can’t help but wonder what the real survivalists think of this show. Forget the school yard games and the psychological game play, that’s clearly just for TV. What I want to know is how realistic are their attempts to build shelter and hunt for food? I’m guessing not very.

I am clearly not a survivalist. I don’t even have the recommended 72 hour emergency kit in my house. I know where my flash light is (I think) and the last time I used it the batteries seemed okay. I usually have at least a few bottles of water in the house but if there were to be a serious interruption of services, like a long term power outage brought about by a massive winter storm or the Zombie Apocalypse I’m pretty sure I would be one of the first to die.

All kidding aside though, all this talk of survival though got me wondering about how many of my readers would survive another type of emergency, a financial one.

emergencyLast fall Manulife Bank completed a homeowner debt survey. They found that half of the households polled have less than $1,000 in emergency savings. But considering the impact of a job loss or the cost of making a major repair like replacing a roof or a furnace, $1,000 clearly won’t go very far.

In addition to the more common unexpected expenses, consider a couple of others as well, like pet care and aging parents. Unexpected health care expenses for Fluffy the Cat can run into the thousands, $1200 for dental care alone. Provincial health plans rarely provide the level of care aging parents might need following surgery or any other kind of health crisis. Not to mention the cost of travel if you live a distance away and if you need to make a last minute trip to attend to their needs.

The survey found that while 73% of homeowners believe they are at least somewhat prepared to deal with the unexpected, 38% admitted that they were caught short when something did happen, 24% didn’t even know if they had any emergency funds at all and 13% admitted to having no money set aside for emergencies.

Click this link to my financial readiness quiz and see what areas could use some improvement in your life then call me to talk about your results and figure out what next steps you should take to boost your score.

Results

0-38 points – Some serious improvement needed

39-60 points – Moderately ready

61-75 points – Financial readiness all-star

Mr. Lauren C. Sheil is a serial entrepreneur who has been in business for over 20 years.  He is currently a Financial Security Advisor with one of Canada’s premier financial planning organizations.  He holds dual licenses from the Financial Services Commission of Ontario (FSCO) for Life, Disability and Critical Illnesses Insurance and the Mutual Fund Dealers Association of Canada (MFDA) for personal investments.  He is passionate about helping people to live life to the fullest while Eliminating Debt, Building Wealth and Leaving a Legacy.  

He can be reached at themeekonomicsporject@gmail.com or by calling 613-295-4141.

Save

Save

Save

The Right Fit


Finding the right financial advisor can do wonders to help you reach your goals.

tailorHave you ever noticed how many of the biggest goals in life tend to have a financial component? Yes okay, you can learn a foreign language or train for a triathlon (like I am), without making a big financial commitment. But for the really big life events like buying a home, starting a family or helping your kids go to university, not to mention retiring or creating a legacy, without disciplined planning, your goals will just become pipe dreams and slip away.

If you’re like most of my clients, juggling a career and family, you don’t have time to figure it all out for yourself, either. And like most Canadians, you probably feel like you don’t have the knowledge to take on the complexities of financial planning by yourself. That’s when seeking the advice of a professional can give you a huge boost. In fact, getting the right person working on your team can make all the difference in helping meet, or even exceed your goals. According to research by the Investment Funds Institute of Canada (IFIC), the retirement accounts of Canadians who retain the services of a financial advisor significantly outperform those who don’t.

88-1953n

The stakes are high when it comes to talking about something as important and personal as your retirement accounts. Your expectations of your advisor need to be just as high. Like all good advisors my commitment to my clients is to do at least these three things:

  1. Learn about you. This means endeavoring to understand your family’s goals both short- and long-term, not just your finances but also your general hopes and dreams.   Just as importantly, your advisor should help you understand your attitude toward risk. Do you avoid risks at all costs? Do the ups and downs of the markets excite you? Or more commonly, are you want I like to call a Goldilocks investor, not too hot and not too cold.
  2. Build your plan. This is the part where the term Financial “Advisor” gets its name. We’re all about giving advice after-all. As your advisor I will create an actionable plan that contains a number of things that you can do immediately. The plan will also show some milestones to be achieved later. A complete plan will include:
  • Debt management – this should be the first part of every financial plan, if you don’t pay attention to your debt there is no point in going any further.

  • Systematic savings – predetermined and agreed upon amounts to put aside regularly (usually monthly).

  • Investment portfolio – keeping in mind your attitude and tolerance toward risk, a well planned portfolio should both protect and grow your assets.

  • Tax strategy – Ben Franklin was right, there are only two certainties in life, death and taxes, but smart people know how to a least minimize and differ the amount of tax they pay.

  • Risk management – There is nothing any of us can do about death, life, disability and critical illness insurance are integral parts of all financial plans that help to protect your family from the inevitable and the unthinkable.

  • Retirement plan – Everyone at some point will stop working, either by choice or out of necessity. The plan will include projections of when you can expect to retire, and with how much money.

  1. Adjust your plan. Life is never systematic and fixed, change is a given and often unexpected. Your plan must be flexible and reviewed regularly. I contact my clients at least twice a year just to check in and make sure all is well, generally with a phone call on your birthday and a summary report around the anniversary of our setting up your plan. We will also try to have a sit down meeting once a year to check your progress, revisit your goals and, if necessary, reset your course.

 Not just about retirement

notjustretirementA lot of Canadians start thinking about engaging an advisor somewhere in their 40s or 50s, when retirement starts to look like a real possibility. Major life events like buying a home or becoming a parent also tend to trigger a need for a financial reckoning and a bit of outside advice. But you don’t have to wait for big goals to appear either. Maybe you just want to save up for a new car or take a vacation without going deep into debt these are all good reasons to make an appointment with an advisor.

The point is, you call the shots with your advisor we work for you after-all. Anything from helping you to create a comprehensive estate plan to just being an impartial third party sounding board for your own ideas.

Finding the right fit

Every client and every advisor are unique individuals, and each party brings a different set of personal experiences and professional skills to the relationship. And don’t discount that “gut feeling” everyone gets when they first meet someone new either. Personally I know that I work best with people who share some of my core values. They are:

Integrity, Stewardship, Humility, an openness to learning and accepting that you might not even know what you don’t know, and an unwavering commitment to avoid and eliminate debt.

My mission statement says it all:

I am here to teach you to Eliminate Debt, Build Wealth and Leave a Legacy.

If you think you can align with those core values and goals I think we can find a way to work together. Contact me any time at themeekonomicsproject@gmail.com and let’s get started.

Mr. Lauren C. Sheil is a serial entrepreneur who has been in business for over 20 years.  He is currently a Financial Security Advisor with one of Canada’s premier financial planning organizations.  He holds dual licenses from the Financial Services Commission of Ontario (FSCO) for Life, Disability and Critical Illnesses Insurance and the Mutual Fund Dealers Association of Canada (MFDA) for personal investments.  He is passionate about helping people to live life to the fullest while Eliminating Debt, Building Wealth and Leaving a Legacy.   (And he really is a triathlete.)

He can be reached at themeekonomicsporject@gmail.com or by calling 613-295-4141.

Save

Save

Quote of the Day – 11/28/2016


A market without rules and borders increases the freedom of the biggest and most economically powerful players to become even bigger and more powerful at the expense of the freedom and right to self-determination of people and communities. Corporations and financial markets make the decisions and reap the profits. Communities are left to deal with mounting human and environmental costs. – @dkorten David C. Korten; The Great Turning, From Empire to Earth Community

Quick Tip # 9 – The Value of Planning Ahead


Having a financial security plan in place can improve your ability to save and help you create the lifestyle you’ve worked hard to achieve. Individuals with sound financial security plans in place are significantly more likely to report an improved ability to save in the last five years. They may:

  • Be better equipped to deal with unexpected financial emergencies or tough economic times
  • Feel confident their loved ones will be financially looked after if something should happen to them