Calling all Boomers

boomersIn less than three years, the number of retirees in Canada will grow to 5.7 million people!

By 2036 nearly 1 out of 4 Canadians will be seniors, thereby outnumbering children for the first time in history.

The Risk of running out of money

Forty years ago Canadians retiring at age 65 could expect to spend about 13 years in retirement. Today, Canadians are living longer and can expect to live as many as 20 to 30 years in retirement, according to the Canadian Institute of Actuaries. This begs the question: “Will today’s retirees have enough?”

Retirement income solution

While statistics clearly demonstrate the pressing need for retirement readiness, according to LIMRA (the Life Insurance Market Research Association) only 11 per cent of pre-retirees within one to four years of retirement have a formal written plan for managing their finances. Having a relationship with a licensed Financial Security Advisor plays a strong role in helping you make the connection between a solid plan and achieving the retirement lifestyle you envision.

The investable assets held by Canadians aged 55 to 74 are currently over one trillion dollars. This is in reference to the amount of money held for the purpose of accumulating and preserving wealth and that number, according to the federal government, is expected to increase significantly and almost double by 2022. Think about your own portfolio and what this means to you – especially when it comes to retirement planning.

Have you talked to your financial advisor about:

  1. Your vision for retirement? How you plan to spend your time?

  2. How much guaranteed income you expect (old age security, Canada Plan/ Quebec Pension Plan, traditional employer pensions, etc) and how much you will need to cover essential expenses along with allowing you to live the life you have planned?

  3. The strategies you can include in your income plan to provide some growth potential so you can maintain your buying power in retirement?

These are all questions a good Financial Advisor can help you answer. At the Meekonomics Project part of our mission is to help people get out of debt, build wealth and leave a legacy. We deal with these and many other questions regarding retirement income planning every day. For more information how you can optimize your investments to achieve the retirement you desire write to –

Happy Canada Day – Get out of town 74% of households with a financial plan do each year

Okay socanadaflag I’m copping out a bit today from my regular Wednesday blog. It’s a holiday here in Canada, the celebration of our nation’s independence from England in 1867, so rather than write a big long post I figured I’d pull some stats from the website of one my corporate partners on the value of financial planning advise as it pertains to summer time fun. Check it out and if you want more information on how I can help you have a great summer and still retire happy, shoot me an email at

Enjoy life on your own terms. Have a financial plan.

  • 72 per cent of Canadian households who receive financial planning advice are satisfied with their current financial situation, versus 53 per cent of non-advised households
  • 74 per cent are able to enjoy an annual vacation, versus 44 per cent with no plan
  • 65 per cent have money left over for the occasional splurge, versus 31 per cent with no plan
  • Advised households also feel better prepared for life’s unexpected challenges, like financial emergencies (60 per cent vs. 28 per cent) and tough economic times (65 per cent vs. 36 per cent).

Plan to retire comfortably

 Don’t leave your retirement plans – or the financial security of your loved ones – to chance.

Canadians who engage in financial planning:

  • Are twice as likely to feel on track to retire when they want, compared to Canadians with no plan (50 per cent vs. 22 per cent)
  • Feel confident they will have enough money to retire comfortably (74 per cent of advised households vs. 52 per cent of non-advised households)
  • Feel confident their loved ones will be looked after financially if something should happen to them (73 per cent vs. 41 per cent of those without a plan)

Plan to maximize your financial potential

 Without a plan, you may be missing valuable opportunities to make your money work for you.

Advised households:

  • Are twice as likely to participate in tax-advantaged solutions such as RRSPs, RRIF, RESPs and TFSAs than non-advised households
  • Have portfolios that are more optimally designed for future performance

Plan to partner with an expert

 Your advisor is a partner for life – an expert who will review your financial security plan on a regular basis and help keep you on track. So plan on taking the first step to living the life you want – today and in the future.

Will You or Won’t You?

Whenever I sit down with a new client and start to build out the file there is a question that get’s asked that always draws a few quizzical looks.

I always start with a new client by explaining my mission:

I am here to help you reconcile your relationship with God (your values) and Money (the value store) through Education and Empowerment. To teach you to live Debt Free, Build Wealth and Leave a Legacy.

I then say that in order for me to do that you first have to educate me about where things stand for you right now and what brought you to my conference room or the kitchen table in the first place. We then play a game of 20 questions (it’s actually a lot more than that depending on the answers) and question number 5 (or somewhere in the first few questions at least) is; Do you have a Will?


I’ve been doing this for a long time and I am continually shocked by the number of people, especially young people with debt out their ears and young families who say no. But the statistics don’t lie and they don’t discriminate across ages either. Money Magazine, a publication of Time Magazine, recently published the results of a survey which showed that over half of Americans between ages 55 and 64; the last ten years before traditional retirement age STILL haven’t made a will!

Although those are American numbers, statistics in Canada aren’t much different. With recent changes to the Ontario Probate system (and the continuing aging of our population) it has never been more critical for people to have a legal and enforceable will.

Most people don’t want to think about getting a will. I get it, it’s the same reason most people don’t want to think about buying Life Insurance; nobody wants to talk about death. But I am here to pour a little bit of cold water on your life and tell you flat out, you have too. Dyeing without a legal will, that everyone involved knows about and understands, is just rude! You’re not doing anyone any favors and the last memories people will have of you won’t be about love and honor or respect, they will be about how much work it was and how much it cost to clean up the mess you left behind.


For instance, In Ontario if you die intestate (i.e. without a will) the government will appoint a trustee to administer your estate. That trustee will usually be a law firm that specialized in this type of thing and charges the estate a hefty fee, all assets will be collected into an estate account, a large portion will be lost to tax, another large portion will be lost to legal fees and what is left, if anything will then be divided among your heirs as the judges and lawyers see fit. If your estate is quite small, or very large, this may not be a big deal but what about the care of your minor children? Or giving to your favorite charity?  Do you really want to leave those decisions to a lawyer you have never met?

I’m not a lawyer. I am not qualified to give any advice on how to go about setting up a will or even on what to put in it. But it is my mission to educate and empower you to do the right thing when it comes to your estate.

So here it is, my best advice for anyone with any kind of debt, assets or family to protect.  (And that is everyone if you’re paying attention.)

Ready?  Here goes –

Everybody dies – get used to and get a will!

It’s the only way you can ensure that the legacy you are building will even happen, let alone last beyond your time on this earth.


Mission, Vision and Values

For the last few weeks, in my spare time (which isn’t nearly enough) I’ve been working on my business plan for 2015. As part of that process I thought it was high time I wrote out a formal mission, vision and values statement to help guide the rest of my planning. I’ve posted my mission statement in this space before but one or two lines without a lot of explanation and reasoning behind them can fall flat so here is the complete document that explains everything and makes up a part of my overall business plan.

Let me know what you think.


Mission Statement


To help people reconcile their relationships with God and Money through Education and Empowerment. To teach people to live Debt Free, Build Wealth and Leave a Legacy.


Embedded within this statement are 4 main points.


1 – Reconcile Relationships with God and Money.

Few things conjure up as much emotion and generate more personal reflection and debate than questions about theology and finance. Jesus himself said that you cannot serve two masters; “No one can serve two masters. Either you will hate the one and love the other, or you will be devoted to the one and despise the other. You cannot serve both God and money.” [Matthew 6:24]

You can only serve one master and that master should be God but the fact of the matter is that you must learn to live with money if you are to function in society. Through my published writings, public and private seminars and one on one counseling I educate people on the proper place of money in their lives and empower them to treat money with the reverence and respect it deserves without letting it rule them. Even if you do not share my faith, the principles I teach are time honored proven and effective methods that will work for anyone.

2 – Teach People to Live Debt Free

Financial freedom begins and ends with freedom from debts. King Solomon, the 3rd King of ancient Israel, widely regarded as one of the wisest men in history is believed to have said; “The rich rule over the poor, and the borrower is slave to the lender.” [Proverbs 22:7]

Being deeply in debt is a lot like being in bondage to a master. When a large percentage of your income is already earmarked to make payments on money you have already spent it can feel a lot like indentured servitude or slavery. Achieving debt freedom is a lot like being released from prison. Your money is finally yours to do with what you like. But getting to that point is hard work. Our society tells us to buy now and pay later. Living debt free is counter cultural but it is the best, fastest and easiest way to become wealthy.

3 – Build Wealth

Building wealth is not a sin. Wealth is freedom, plain and simple. We should not worship wealth but money is a means to an end and in order to be effective in life and in ministry we need some freedom from the demands of the marketplace.

King Solomon is also said to have stated; “Dishonest money dwindles away, but he who gathers money little by little makes it grow.” [Proverbs 13:11] If you build wealth as part of a meticulously planned process with honesty and integrity it will be blessed and it will grow. That’s a fact.

4 – Leave a Legacy

Why build wealth? So that you can enjoy a comfortable lifestyle of course but there is so much more that can be done with money than simply spending it on yourself. It is my considered opinion that the real purpose of wealth is to bestow a blessing on others.

Jesus said; “Do not store up for yourselves treasures on earth, where moths and vermin destroy, and where thieves break in and steal. But store up for yourselves treasures in heaven, where moths and vermin do not destroy, and where thieves do not break in and steal. For where your treasure is, there your heart will be also.” [Matthew 6:19-21]

You can’t take it with you, so you may as well use what you need and give the rest away. Legacy planning or Philanthropy is all about tax effective life and estate planning that seeks to bless others with our accumulated wealth now and in the future.



I want to be the financial planner of choice for –

  • Individuals with big dreams and bigger hearts but who are saddled with debt and struggle to make their dreams a reality.

  • Locally Owned Small and Medium Sized businesses with a strong commitment to family values and engagement with their employees, suppliers and local communities.

  • Philanthropists, both big and small looking for tax-effective ways to leave a legacy now and long into the future.

  • Non-profit, Charitable organizations and Ministries that want to be better stewards of their financial resources and the trust that has been bestowed on them by the communities they serve.

Each point above brings with it a specific clientele with specific needs in terms of product and services. In order of priority I offer a different suite of products to each sub-group of clients, all in keeping with my primary mission.

1 – Individuals will be looking primarily for financial coaching, credit counseling, risk management and investment products.

2 – Businesses will be looking for HR consulting, group benefits, risk management, investment, marketing/branding assistance and some financial coaching and credit counseling.

3 – Philanthropists will be looking for investment and tax advice with some risk management and financial coaching requirements.

4 – Non-profits will be looking for tax advice, investment advice, marketing/branding assistance, HR consulting, group benefits and risk management products.


Faith above all, Integrity, Compassion, and Stewardship.

Faith – “A city built on a hill cannot be hidden. Neither do people light a lamp and put it under a bowl. Instead they put it on its stand, and it gives light to everyone in the house. In the same way, let your light shine before others, that they may see your good deeds and glorify your Father in heaven.” [Matthew 5:14-16]

It is who I am, there is no point trying to hide it. My faith informs and guides everything I do. I am not perfect; I am a sinner saved by grace. I must acknowledge my failings, praise God for his forgiveness and impart grace to all whom He puts in my path.

Integrity – “Show yourself in all respects to be a model of good works, and in your teaching show integrity, dignity, and sound speech that cannot be condemned, so that an opponent may be put to shame, having nothing evil to say about us.”[Titus 2:7-8]

It should almost go without saying that a financial services professional should have integrity. In dealing with something as precious as people’s money to act without integrity is beyond deplorable. But as a person of faith there is even more at stake, acting without integrity damages not only my reputation but the reputation of the entire faith community. Jesus said; “I tell you, on the day of judgment people will give account for every careless word they speak, for by your words you will be justified, and by your words you will be condemned.” [Matthew 12:36-37].

Compassion – “Put on then, as God’s chosen ones, holy and beloved,  compassionate hearts, kindness, humility, meekness, and patience, bearing with one another and,  if one has a complaint against another,  forgiving each other;  as the Lord has forgiven you, so you also must forgive.” [Colossians 3:12-13]

The word, compassion is derived from two Latin words; Com – together and Pati – to suffer. Feeling compassion or being compassionate is to walk with my clients in their darkest days. Suffering under the burden of debt and the bitter sweet feelings associated with risk management and estate planning can be difficult for a lot of people. A heart of compassion is called for in all client dealings, especially for individuals struggling with debt and loss. I was bankrupt in 2005, I know first-hand the pain and embarrassment associated with that particular failure. Among my fellow financial planners I am uniquely experienced to show compassion as a result of my past need for compassion of my own.

Stewardship – “Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much. So if you have not been trustworthy in handling worldly wealth who will trust you with true riches?  And if you have not been trustworthy with someone else’s property, who will give you property of your own?” [Luke 16:10-12]

Overseeing the management of other people’s affairs, particular as they pertain to finances, is the very definition of stewardship. As a Christ-follower the term takes on added meaning in that I acknowledge that I am not only a steward for my client’s but also a steward for the Kingdom of Heaven. Everything I have is His. I am merely a steward of the things God has given me. As such I place a high value on giving back, both to my church and to my community.

So that’s it, what do you think?

If that resonates with you I would love to do business with you.  Contact me any time. If it doesn’t that’s okay we can probably still be friends and do some business but we won’t likely click on all cylinders and as a result we won’t be getting the most out of our relationship with one another.

Do you have a personal mission statement? What is it? How does it inform the way you work and live out your daily life?


“I have Cancer – Call Me…”


That was the gyst of a text message I received from a long time client last Sunday. After I swallowed a few times and put my heart back where it belongs I called my client and had a gut wrenchingly honest conversation about what happens next and where we go from here. He’s 57 years old, divorced and utterly alone.

Statistics Canada Recently Revealed half of Canadians who own small and medium-sized businesses (SMBs) are between the ages of 50 and 64 – an age when employees typically make full use of retirement programs such as workplace savings plans. Yet, owners appear less likely to plan ahead. According to the Exit Planning Institute’s 2013 State of Owner Readiness Survey, 83% of SMB owners have no written transition plan and 49% have done no exit planning. [Canadian Business; Fall 2014 volume 87, issue 11/12]

That is the opening paragraph of an article in a recent issue of Canadian Business Magazine entitled It’s never too early (or late) to plan for succession and it get’s right to the point. Canadian Business owners are unprepared for the next phase of life.

I’ve had similar conversations with business owners many times. It goes something like this, “my business is my retirement plan, revenues were $100,000 last year and I can reasonably expect to sell for 5 times earnings so I will pocket $500,000 that’s more than enough to fund a comfortable retirement.” Most business owners base their assessment of the value of their business on that one number, gross revenues. But to put it bluntly – to base value on just one factor is insanity and it rarely works out.

There is an old adage in sales that applies perfectly when selling a business that goes like this:  The value of anything, commodity or service is precisely what other people are willing to pay for it, no more, no less.  There are dozens of factors that go into valuing a business far beyond just gross revenues.

Here are a few just to jump start your thinking.

1 – The number one revenue generating factor in your business isn’t for sale.

Think about it. You are selling your business so that you can retire but the number one factor in the success of your business so far has been you! A business coach friend of my once told me that he spends most of his time trying to get entrepreneurs to think about their business as a entity that will outlast them, they work on putting in place systems and procedures that can run without the direct involvement of any specific person. As he puts it you need to transition to a point where you are working on the business not in it. Otherwise you don’t own a business at all, you own a job. When you go to sell you are really only selling used equipment, inventory and a client list that has no loyalty to the new owner. There isn’t much value in that.

2 – Employee retirement plans aren’t just for employees.

According to a survey done last year by Manulife Financial 67% of Canadians said they wish they’d contributed more to RRSPs.  Employees that had the option to contribute through a plan sponsored by their work place were far more likely to have made any contributions at all.   But employers who offer plans were no more likely to have made contributions of their own.  Offering a group retirement plan through your company payroll is a great way to set up your own RRSP program as well. Not to mention the less tangible factors benefits provide toward employee retention, less stressed and more focused workers.

3 – Make sure you have a contingency plan in case of an unexpected exit.

Few things destroy the value of a business more than the need to sell in a hurry. What if you have an unexpected health related event and need to retire next week? This goes back to that text message I got on Sunday. What kind of price would he be able to get for a business know?   Luckily this particular client has in place adequate Disability Insurance and a personal pension plan that he can draw on first but he is still being forced into retirement about 6 years sooner than anticipated. If this were you, how would you cope with the short fall?

These are just three factors that should be considered when planning the exit from your business. I’ve barely scratched the surface here. The bottom line is this; don’t fool yourself into thinking that your business will fund your retirement without doing some real deep analysis of the facts. You may be right but in my experience most business owners have an inflated idea of what their enterprise is really worth. As a result they are either forced to live on less than they should or work longer than expected. And some, like my recent client need to make a speedy exit that erodes their value even further.

For more information on Succession Planning contact me at:

Live Long and Prosper


The financial concerns of retirees were recently captured in a poll by LIMRA, a worldwide research, consulting, and professional development organization.

The top concerns included:

  • Healthcare: 85 per cent expressed concern about covering healthcare costs

  • Emergencies: 81 per cent expressed concern whether or not they would have enough money to pay for the unexpected

  • Increased housing costs: 45 per cent expressed concern about their ability to pay for housing

Ultimately these concerns point to the same issue they always have; nobody wants to run out of money in retirement.

I recently had the opportunity to experience this shift first hand as I helped a couple transition from the accumulation of wealth to planning for its distribution and depletion. There’s an increasing need to ensure people continue to receive income throughout their retirement years. The focus is no longer on growth but on security and this is having a profound impact on the way the markets are beginning to function.

This generation has worked very hard to save for retirement throughout their career, but due to a changing pension landscape and market fluctuations, some are unsure how to move forward. They’re looking for solid retirement income planning and advice to guide them through the shift.

Since the market downturn in 2008, many people who are nearing retirement lack confidence in the markets and their investments. Despite this skepticism, they are looking for something they can believe in and solutions that put them back in the driver’s seat.

A recent study found that 97 per cent of retirees want to remain financially independent.

So what’s my number one piece of advice for a retiring client?

Forget about growth and lock in your income.

As a financial advisor who works with an insurance firm I have access to a unique blend of guaranteed income products that banks and other strictly investment based firms can’t offer. Guarantees are a good thing when you are trying to secure your income and build your budget for the long term, even if it means you sacrifice some growth up front. What is more important short term growth or long term income? Most retirees will agree that the longer and more accurately they can project their income, the better.

Ask your bank advisor what kind of guarantees there are on your RRIF income if the market takes a turn and he’ll likely try to crawl under the desk. On the other hand ask an insurance advisor about those same guarantees and he will beam with pride as he explains the structure of a life annuity or the principle guarantees on a segregated fund.

Commander Spock would agree. In the Star-Trek universe Vulcans live exceptionally longer lives than Humans. I’m pretty sure that if Spock were to retire to Canada he’d take out a Life Annuity with an insurance firm before he’d be willing to risk any of his gold-pressed latinum in a standard RRIF.

Be like Spock, Live Long and Prosper and invest in Annuities….

For more information on retirement income planning write to

What About Having An Emergency Fund?

Recently I publishing a booklet called “6 Steps To Financial Freedom”.

6 steps book

Buy it here, or send me an email for a FREE pdf version.

The six steps are:

  • Dominate Debt

  • Regulate Risk

  • Rule Retirement

  • Engineer Education

  • Take Control of Taxation

  • Leave a Legacy

(I like alliteration can you tell?)

It wasn’t long after I started talking about this before somebody asked me, “what about having an emergency fund?”

It’s a popular belief among financial planners and coaches that after you get your debts under control your next goal should be to save up three to six months of expenses. Most people say to put this money in a readily liquid emergency fund like a savings account. That way life’s little hiccups don’t put you back into debt or cause you to have to take money out of your retirement plan to survive.

This is good common sense advice and if you want to do that go ahead, but I think there are better ways to invest your money than keeping large amounts of liquid cash earning little to no interest for a “rainy day”.

Here are three reasons I do not include having an emergency fund as part of the 6 Steps.

1 – Most so called emergencies are actually events that, if you’re being honest you saw coming and should have been planning for.

The roof on your house didn’t start leaking overnight, a little preventative maintenance along the way and a savings plan to deal with the inevitable will save you the need to dip into an emergency fund at all. If you are out of debt and you see a big expense coming, it’s okay to push pause on the rest of your plan and build up cash for a large one-time expense.But don’t call it an emergency – it isn’t.

Although not technically part of the 6 Steps I call this a sinking fund.  You build up money in it over a period of time and then “sink” it when the time comes. Right now I have a sinking fund set up for Christmas Gifts. In December I’ll sink that fund, take the money a buy few gifts. Other common uses for a sinking fund include the purchase a new car, a major home renovation or repair, elective surgery, or even a nice vacation.  None of these are emergencies, they are planned events.

2 – A lot of truly unforeseen emergencies can be funded or mitigated through a well thought out insurance program. Some of the biggest unexpected expenses we encounter are the result of disability, illness or damage caused by weather, all insurable risks at relatively low cost. The entire insurance industry is actually one big pool of money designed to help you with emergencies. One way of looking at is as a giant, communal emergency fund. That’s why step two is to regulate risk.  If you want to be “self-insured” then you can include some form of emergency fund as part of step 2, but you don’t need a lot and it is not a substitute for adequate insurance.

3 – Finally there are some true emergencies that you can’t see coming and that you can’t insure against. As part of step 3, Rule Retirement I talk about several different investment vehicles that are available for long term planning. Some are very liquid and have no tax consequences for early with drawl. If you are faced with a true emergency, something that can’t be planned for in advance or that you didn’t get insurance for, it’s okay to make a one time with drawl from your retirement funds. Just be aware of the tax implications and be sure to put the money back as quickly as possible.

Here’s the big idea about not having an emergency fund.  I firmly believe that by not having a dedicated emergency fund it forces people to change their definition of emergencies. If your emergency fund is too liquid and there are no consequences for taking money out, like incurred taxes or delayed retirement, you may tend to consider everything an emergency. That’s not so say you shouldn’t have some liquid cash on hand, but most people can get by with as little as $1000 or so. If you are out of debt, have adequate insurance and are saving for retirement, there are very few emergencies that you can’t handle in this way.

What’s your opinion of having an emergency fund? How much do you have set aside and where is it held? Have you ever tapped into your emergency fund? If so what for? I’d love to hear your opinion…

How to Keep Your Partnership From Sinking? (Pt1 of 2)

The only kind of ship that won’t float is a partnership… Dave Ramsay

sinking ship

Roughly half of my corporate clients are structured in some form of partnership. Running a business can be lonely and stressful and depending on your personality it can be helpful to have people around you that you can lean on and keep you moving in the right direction. It’s also helpful to have an equity partner when raising capital or creating a division of labor especially in organizations that require many and varied skill sets to operate. Granted that does not need to be in the form of a formal partnership but being a lone wolf is not any better or worse, structurally speaking, that having a formal partnership structure of some sort.

I’ve seen it a number of times though, two friends meet in college or on the job and decide that it would be fun to be in business together. They develop a concept, raise some capital and set out into the brave world of entrepreneurship. But not too far down the road they run into some form of conflict, they have difficulty getting a product to market, lose their funding or one party just loses interest and before long the company in mired in conflict and infighting worthy of a daily soap opera. That is what radio personality and author Dave Ramsay is referring to in the quote above. When conflict inevitably strikes, partnerships sink.

That’s why I work with all of my corporate clients that are structured as partnerships to make sure they have a well planned and iron clad partnership agreement. I am not a lawyer but I consult regularly with businesses on structural and managerial issues. In my experience the partnership agreement needs to clearly spell out what to do when the partners experience one of the four Ds.

  •           Death
  •           Disability
  •           Disinterest
  •           Distraction

The first two are the most dramatic, the least common and the easiest to deal with using some simple insurance type products. The last two are far more common and take a lot more planning and forethought to deal with upfront but believe me, if you make the effort now it will save you a ton of heartache later. Dissolving a business partnership is not unlike a divorce and your partnership agreement is kind of like your pre-nup so take the time to get it right, you’ll thank me later.

I’ll tackle the first two Ds today and come back to the last two in my next post.


Contrary to what many people believe, under family law when a partner in a business dies his shares in that business do not automatically transfer to the surviving partners. They instead transfer to his surviving spouse, children or other next of kin. What the means is that if you are in a partnership with someone and they die, you are automatically in business with the heirs of their estate. Those people may have absolutely no interest or ability in being in business with you or they may be simply incompetent or just plain crazy.  If losing your partner wasn’t enough to sink the business, being in business with his distraught widow could be exponentially worse.

In most cases the easiest way to combat that eventuality is with a criss-cross Life Insurance ownership. Each partner buys life insurance equivalent to the value of their shares naming the other partner as the beneficiary. When one partner dies, they use the proceeds of the life insurance to buy the shares from the deceased partner’s estate. If the company is structured as a corporation we can have the company purchase the policies and pay the premiums with corporate pre-tax dollars but then actually getting the money into the hands of the deceased partner’s estate is a bit more complicated. That’s a specific discussion that I would have with an individual client but the concept here is pretty straight forward and there is no reason why any partnership would exist without some form of life insurance on the partners.


Similar to the situation with death, if one partner is unable to work the value of the company is likely going to go down. But partnership owned disability insurance is a lot more complicated than life insurance because we are trying to accomplish multiple results. Not only are we trying to preserve the value of the disabled partner’s shares, we are also trying to replace his income and perhaps hire a replacement to do his job. This is often accomplished through the purchase of three different disability insurance products.

First we look at business overhead insurance. This is a disability policy designed to help pay the day to day expenses of running the business in the absence of a key person. Second we look at an income replacement plan, coverage to pay the salary of a disabled person while they are unable to do the regular activities of their job. And thirdly we would look at Key Person insurance, designed to provide start up capital to hire a replacement for a key employee or business owner in order to keep the business afloat. All three policies can be owned either individually or corporately. The ownership structure of the policies is dependent on the structure and type of business you are running and would again be a specific discussion I would have directly with the partners.

For more information on the process of structuring theses policies inside a well crafted partnership agreement write to: and stay tuned Wednesday for part 2 of this discussion when I tackle the remaining Ds, Disinterest and Distraction…




Beware; Group Insurance Broker Scam

Full Disclosure – I am a licensed Life and Disability Insurance broker and about 40% of my business consists of group insurance programs for small business. One of my clients was a victim of this scam recently so I feel compelled to out what is sadly, common practice in the industry.

slimy salesmanjpg

The Group Health Insurance industry is very competitive. At the present time there about twenty insurance companies in Canada offering this type of product and almost none of them work directly with clients, instead running their new sales and client management through a broker network. As with anything, there are two types of brokers out there. Those who work with honesty and integrity in the best interests of their clients, and those who seek to cheat the system for their own gain.

Here’s how to tell the difference.

When you are approached by a new broker the conversation will likely go as follows. The new salesperson will offer to provide you with some competitive quotes. That’s not a bad thing but in order to do that he/she will say that they need to see your current experience ratings and past history. If you still have a copy of your most recent renewal offer it will be enough give him/her that and the conversation should end there. They will have everything they need to do their job and provide you with competitive quotes. If you don’t have that information handy, all you need to do is call your current provider and ask for it. There is nothing wrong with a new broker asking to see your current experience rating or with you asking your current provider to forward the details to someone new.   Like I said, this is a competitive business and there is nothing wrong with you trying to keep your current provider honest. Good brokers do it all the time and good companies welcome the opportunity to prove their worth to their clients, that just good business.

Now, here’s how the scam artist operates.

If you tell him/her you don’t have the experience rates, or you don’t know what they are he/she will say “that’s okay” and slide a piece of paper across the desk toward you saying, “All you need to do is sign this document and your current provider will release all of the information I need directly to me.” They will start talking very quickly in the hope that you don’t actually read the document. If that happens stop and read it very carefully.

The fact the broker has asked you to sign this is not really the scam, some honest brokers my still have this as an option.   Earlier in my career I did it too, even though I now consider it to be lazy. What the document should say is that you are requesting your current provider to release the information for marketing purposes only. And they may even tell you that’s what is says. But nine times out of ten what the document actually says is that you are transferring the entire file to the new broker, including commissions payable and making it impossible for anyone, including the person who originally set up your account, to view your file or sell you a new policy with any carrier. What they have done is cut your current broker off at the knees and made themselves your exclusive agent. If there is any mention of commissions whatsoever tear it up and throw the “broker” out of your office immediately.

While technically not illegal, this practice amounts to theft. You see, most brokers are not paid upfront by the carriers they represent they are instead paid a trailing commission on a monthly basis. By signing this document you are designating the new broker as your agent of record and all commissions currently owed for the previous renewal period are transferred to them, even though they have done absolutely nothing to earn them. Call your current broker immediately and tell them there is a scam artist out there trying to steal their money.

The only time you should sign anything with a competing broker is when they bring you a new offer or in rare circumstances if you are truly dissatisfied with your current broker and wish to fire them.

The insurance industry gets a bad enough rep as it is. We don’t need scam artist running around lying to clients and trying to cut off their competitors. Competition is good for you and a good broker should welcome the opportunity to prove to you why they are the best in the business, not lie to you and try to shut out the competition and steal other people’s money.

Leave a Legacy

Six Steps to Financial Freedom, Step Six

Congratulations, you’ve arrived at the end of the road. Welcome!  Thanks for sticking with me for the past six weeks.


For every big and exciting goal people set in their lives there are two essential questions that we must ask, how and why? So far throughout these six steps I’ve shown you a lot of “how” and a few small “whys”.

Get out of debt so that you can relax and build wealth; regulate risk so that you don’t have to worry about the unexpected, etc. But when you get to the end of the process, step six is the biggest “why” of all. Steps one through five ultimately lead us here; leave a legacy.


Because you can’t take it with you.  If you’re not careful, everything you worked for will be lost the moment you take your final breath.  Proper legacy planning allows you to reach out from the grave and direct how your hard earned assets will be spent long after you’re gone.

There are only three things you can do with your wealth. You can; save it, spend it, or leave it. The problem is you can only save it for so long and if you don’t spend it or leave it effectively there is a fourth option that comes into play, the government will take it.

In the world of legacy planning it’s that forth option that we want to avoid at all costs so we work backwards from there. If you follow the first five steps effectively you will die with money left over, that’s a fact. There is an interesting little wrinkle in the tax law called a “deemed disposition”, is means that when you die all of your assets are deemed to have been sold 5 minutes before you pass, all of your assets are then counted in your income on your final tax return. If you have even a modest amount of savings all of your assets calculated as income in one year automatically place you in the highest tax bracket in the country. Depending on the province you live in that will be about 45%, so the government will take almost half! We can usually avoid that with a well structured Life Insurance contract, see step five,  but what about making a lasting contribution to society as a whole?

Here are 3 other ideas for leaving a lasting legacy.

1 – Name a charity as the beneficiary of your Life Insurance, RRSP/RRIF or Annuity. This will provide a lump sum donation and create a nice tax deduction on your final return.

2 – Set up a charitable family trust to administer your investment accounts after you are gone and dole out money to your favourite causes in smaller, more sustainable and longer term amounts over time. If managed well, with a decent endowment to begin with a family trust could last for generations.

3 – Start now by collaterally assigning Life Insurance and other income sources and allowing the named charitable organizations to take control of the asset while you are still living. In this case you can exert influence over how the money is spent directly and see the results of your philanthropy with your own eyes.

Of course none of this should prevent you from continuing to support a worthy cause with cash while you are living. Philanthropy is all about stewardship and there is no greater joy than knowing that the work you have done to build wealth will benefit those who are less fortunate.

From everyone who has been given much, much will be demanded; and from the one who has been entrusted with much, much more will be asked. [Luke 12:48]

For more information on Legacy Planning and effective philanthropy write to: