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Do I need a financial planner or can I do my own planning?

5/30/2013

The financial world today is highly complex. New products come to market all
the time. Often these products are not easy for the average investor to use or
even understand. It can be difficult to sort out the choices you need to make to
plan for - and protect - your financial future.

But at what point do you decide you need the help of a financial planner?
There's no single right answer. Some people say that unless you have more than
$150,000 in savings and an income of at least six figures, you can do your own
planning - if you have the interest and time. Others say that everyone should
have a financial planner.

Top 3 reasons to hire a financial planner

Financial planners are not the same thing as an investment adviser or broker.
They offer a much broader set of skills. You may choose to work with a financial
planner for one or more of these reasons.

You don't feel ready or able to put together a proper financial
plan. Many people don't have the time, interest or knowledge to create
a solid financial plan. For instance, you may not know ways to improve your tax
situation. Or, how to plan for your retirement. Financial planners can help you
put your finances in order. They know how to deal with the 'big picture'. They
will work with you to help you plan for life's twists and turns and to improve
your overall financial life.Did you know? Investor
Education Fund recently surveyed 1,000 Ontarians on their financial knowledge.
The survey found that their knowledge of financial planning and setting goals
was quite low.Learn more now about our financial
literacy survey

Your life has changed and you don’t know what changes to make to
your financial plan. With a new job, for example, you may have more
money. You will also have more decisions to make. What should you do? Save,
spend, or pay down debt? When you get married or start a family, you will have
different concerns. How will you protect your loved ones if something happens to
you? How will you provide for their future? A qualified financial planner is
trained to help you adjust your plan as your life changes. They know the
questions to ask. They can also help you work to balance your goals if you have
goals that seem to conflict.Did you know? Our survey of
investors found that even when people understand a financial or economic
principle in theory, they find it difficult to apply the principle to a real
situation. This can be even more difficult to do well when facing a big life
change.Learn more now about our financial
literacy survey.

You need help to understand and choose appropriate investments to
achieve your financial goals. Investor literacy is low in Canada. Many
people have trouble answering even basic questions about investments and
financial planning topics. Others may know just enough to know they are not
equipped to make the best financial choices. Or, they are worried they will let
their emotions take over and end up buying when they should wait - or holding
when they should sell. If this is you, you may want to work with a financial
planner. Like other advisers, a financial planner can help you develop an
investment strategy that will fit your goals and your comfort
level.Did you know? Our investor survey found that less
than 3 out of 10 Ontarians could pass a quiz on investment knowledge (where a
pass is 60 per cent of answers right). Half of the Ontarians we surveyed
answered less than half the questions correctly.

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How to get value out of your house without selling

5/29/2013

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Here’s a way to get some value from your house without selling. Just be prepared
to stay put and be ready for some headaches.Renovating can make your home bigger and more valuable but without any of the
enormous transaction costs that can easily top 10%, depending on where you live
in the country.

The federal government might have made it more difficult with its tighter and
tighter regulations over the last three years to extract cash out of your home
to pay for renovations.

Whereas once you could refinance your home for up to 90% of the value, it’s
now only 80%.

If you bought a $500,000 home with 5% down, it has to rise in value past
$600,000 before you would be able to extract some equity for a renovation. With
home price increases shrinking — they are not falling in most parts of the
country despite the general negativity — that hasn’t left much opportunity for a
major project.

But guess what? Canadians have other ideas. A new poll shows they are
actually saving for major projects based on the results that reveal a majority
of Canadians are paying for a renovation with cash.

A Bank of Nova Scotia study found 44% of Canadian homeowners plan to do a
major renovation in the next two years. Among that group, 62% will fund the
transaction with cash.

“The renovation market is quite large in Canada and quite consistent, people
are reinvesting in their homes,” says David Stafford, director of real estate
secured lending with Scotiabank.

People are reinvesting in their homes!

The amount of money spent on renovations in Canada is still dwarfed by the
money people spend on buying homes but it’s not small potatoes either. The
latest annual data from Canada Mortgage and Housing Corp. put the market at
$20.9-billion in 2011 across 10 major markets.

Full disclosure here. My money is with those people. I’m planning my own
renovation — having come to the conclusion that the transaction costs associated
with any move into an upgraded house almost gives me “free” money to play with
in my current home.

Okay, it’s not free. I have to fork over the cash. Refinance. Get a line a
credit. Take it out of my TFSA. Whatever. But the bottom line is moving would
have cost me enormous fees.
Unfortunately for me and the other 2.6 million people in Toronto, we live in
a jurisdiction with two land transfer taxes. You have to pay both the city and
province which amounts to $16,200 on a $600,000 purchase or about 2.7% of the
value. The only other city with an equivalent tariff is Montreal with its
so-called welcome tax.

Consider some of the other costs associated with moving. Realtors can begin
emailing me now but the realty is you are looking at 4% to 5% commission on the
sale of your home. Add in legal fees, moving costs and some of the soft costs
like painting and minor repairs that come with any selling and buying
transaction and it’s not hard to get to 10%.

“I wouldn’t say renovation is just a financial decision,” says Mr. Stafford.
“People are looking to improve the quality of their environment. The financing
and financial requirement are just part of that decision.”

It’s a good point. We’ve come to think of our houses as an investment because
they can easily top 50% of our net worth but they are as much about consumption
as anything.

Let’s say you do that $50,000 kitchen project. Is your house really going to
be worth that much when it comes time to sell? Probably not but in the interim
you get to enjoy all those years of cooking and eating in your fabulous
kitchen.

“The reality is that very few renovations return a dollar for dollar,” said
Mr. Stafford, adding one of the other reasons people choose to improve their
existing home are qualitative. “They like the neighbourhood they are in.”

There’s no question not all renovations go as planned. One of the great
perils of renovation is doing the whole thing in cash, to avoid HST, and without
permits to avoid costly fees.

“It’s cheaper in the short run but maybe not the long run,” says Raymond
Leclair vice-president of public affairs with the Lawyers’ Professional
Indemnity Company.

The tax is ultimately something that your contractor is required to pay and
there’s nothing technically illegal with a verbal contract. But when things go
wrong, what do you do without a paper trail?

“It becomes a ‘he said, she said’ situation and you get into court before a
judge and say ‘he painted it blue and it’s supposed to be green’. The other said
says the opposite,” says Mr. Leclair.
And when it comes to permits, think twice about not doing it by the book.
When you sell, the buyer may ask if that addition you built is up to code. The
city can ultimately order any project done without proper permits to be taken
down, says Mr. Leclair.

Doing a renovation on the books is going to cost you more money. For sure.
But when you start by saving up to 10%, it’s worth it.

gmarr@nationalpost.com

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15 things Successful people do

5/28/2013

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Success is to be measured not so much by the position that one has reached in
life as by the obstacles which he has overcome.”
Whether in business or life, there's a fine line between success and
failure.

Booker T. Washington’s quote highlights the inevitability of obstacles
on the path to success. In fact, I firmly believe success and failure go
hand-in-hand. Those looking to succeed must first fail or learn from those who
failed.

Successful individuals aren’t just born, there’s a lot more that goes into
the equation. I've found those who are highly successful have a lot more in
common than we may think. If you’re seeking success, these habits may come in
handy.

1. Fail. No matter how hard you work,
failure can and will happen. The most successful people understand the reality
of failure, and its importance in finding success. Rather than running and
hiding when you fail, embrace it. Learn from this mistake and you won’t fail in
the same way again.

2. Set goals. Those who are successful
set daily achievable goals. Find success by solidifying S.M.A.R.T. -- smart,
measurable, attainable, realistic, timely -- goals. Stop juggling a mental to-do
list of just long-term goals and establish small daily
goals to achieve your vision.

3. Don’t rely on luck. Many relate success to being in
the right place at the right time. While this is an element of success, there’s
also the crucial involvement of blood, sweat, and tears. Don’t hold yourself
back by waiting for the perfect timing or idea. Some of the most successful
people got there by hitting the ground running, even if timing wasn’t
perfect.

4. Track progress. Success comes from
regularly monitoring behaviors, strategies, and tactics. How can you make
adjustments if you don’t know how you’re doing? Hold yourself accountable by
checking your progress as often as possible.

5. Act. Successful people don’t always know the right
answer, but the keep moving anyway. Don’t let obstacles stall you when you’re
searching for the right solution. Taking action will lead to answers.

6. Connect the dots. Those who are successful have the
ability to see the greater picture. They identify and connect the tiny details
to get there. Look at things in a “past, present, and future” context to receive
favorable results.

7. Display realistic optimism. Those who
succeed truly believe in their abilities. This respectfully drives them forward.
Assess your abilities to gain a clear understanding of what you are able to
accomplish. This will allow you balance yourself through the aid of find someone
or something else.

8. Continued improvement. Successful people habitually
thrive on self-improvement, whether it’s in terms of learning from mistakes or
simply using their weaknesses as opportunities. Channel this habit by
continually searching for ways to be better. Maybe your networking skills are
rusty or you need some extra training -- set goals for improving your weak
spots.

9. Commit. Success doesn’t come without
effort. The most successful individuals are often the most committed to what
they’re working toward. Throw yourself into your tasks and go the extra mile
every single day. Make no exceptions.

10. Be alert. A keen sense of awareness
breeds success. If you’re not keyed into your environment, you’re sure to miss
opportunities. Do you know what’s being said within your company, feedback from
clients, or even in your entire industry?

11. Persevere. Truly successful people
never give up. Do they ever fail? Yes. But as times get hard, their stamina to
move forward doesn’t wane. Develop a willingness to work through the challenges
you encounter along the way.

12. Communicate with confidence. Those who are
successful have an ease for convincing others. They don’t manipulate or
pressure, but logically explain the benefits. Communicating with confidence will
allow you to more easily negotiate your visions.

13. Display humility. The most successful individuals
lack an ego. It’s their fault when they fail. Hold yourself accountable for
every aspect of your life by focusing on remaining focused and
humble.

14. Be flexible. Plans may change. Successful people
roll with the punches. Rather than getting frustrated, swiftly maneuver in
another direction.

15. Make connections. Successful people often
attribute their achievements to the help of others. You can’t and won’t be able
to do this alone. Invest in generating mutually beneficial business connections
and partners. Even if you have all the skills necessary to run your company, a
business partner could complement your weaknesses.

Initiating these habits of successful people will fuel you on your
search for achievement.

Written by , Ilya Pozin: Founder of Ciplex.
Columnist for Inc, Forbes & LinkedIn. Gadget lover, investor, mentor,
husband, father, and '30 Under 30' entrepreneur.

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6 practical and simple tips for your business networking needs

5/27/2013

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There’s an old adage, “it’s not what you know, it’s who you know.” That adage couldn’t be more appropriate in today’s competitive job market. And networking (especially when you’re employed) can be the key to staying employed and staying on a clear career track.

But there’s more to networking than shaking hands and exchanging business cards. Done right, networking helps you forge relationships with like-minded professionals to the benefit all.

While networking is often used to generate referrals and leads for new business, it’s also extremely useful for finding a new job, discovering possible new hires, improving basic business practices, or changing career paths altogether.
The key is to get out there and connect. It’s up to you to find and make the most of the opportunities presented.Here are a few ideas to get you started:

1. Have a plan.
For every event you attend, make a commitment to yourself to connect with a specific number of people. Three to five people is realistic. Make sure the contacts are “new” and not people you’ve met before. This will help get you out of your “comfort zone” and you won’t spend your entire evening chatting up old friends.

2. Dress the part.
Fifty-five percent of a good impression is based on how you look. If you want to be perceived as a professional you need to dress like one. Make sure your clothes are neat, fit well and appropriate to the time of day and event.

3. Be professional.
Remember to say hello and pronounce your name clearly and distinctly. Make sure your business cards are clean and not tattered. Shake hands firmly and make good eye contact with everyone you meet. Say the person’s name when you say goodbye and tell the person how much you enjoyed meeting them and hope to see them again.

4. Make the ask.
Don’t rely on other people to remember and reach out to you. It’s your job to ask people for their business card and to maintain contact.

5. Stay in touch.
The biggest mistake people make in networking is not keeping in touch with the contacts they make. Find reasons to reach out and connect.

Perhaps send a link to an interesting news story related to the individual’s industry. Or, if you’ve identified a common interest such as a love of modern art or music, let them know about an opening or event.

It’s not necessary to make plans to meet at the event. Just reaching out is enough to help strengthen your connection and forge their sense of who you are.

6. Be visible.
Take a leadership role in your community and industry organization to build visibility. Join the Chamber of Commerce or, if possible, a more industry-specific organization such as the local chapter of the Public Relations Society of America.Offer to speak at events and offer advice as an “industry expert.” This will position you as a trusted resource and someone to turn to for answers.

While networking generally begins with a quick introduction, the actual benefits can take longer to cultivate. It’s all about give-and-take and it may take a year or two but if you are diligent, eventually the phone will ring and there’s no telling what kind of opportunity will be on the line.

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Top 5 : financial resolutions of 2013

5/24/2013

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Similar to setting health goals, financial planning goals can be best achieved if they are specific and realistic.
Goals should have a time frame to implement and be written on paper. The following are the top five recommended financial resolutions to consider for 2013.

1.Eliminate Debt.     Create an action plan and timeline to pay off your credit card debt as soon as possible (for example, over the next 18 months) and defer any major purchases until you can pay for them with cash. Develop a monthly budget and track your expenses on a spreadsheet or a mobile phone application. Dedicate any available discretionary cash flow to aggressively eliminate your credit card debt. Pay off debts with the highest interest rates first. Be careful to not quickly
consolidate and close out any existing lines of credit, as that could adversely affect your credit score. Also, if you are a baby boomer nearing retirement with a mortgage, create an action plan to pay off that obligation within four years, before or after, your retirement goal.

2.Protect your credit score.
Regardless of your age, your credit score may come into play for many critical activities from renting an apartment to applying for a new job. Protect and improve your credit score by keeping your balances low and paying off the majority of your expenditures every month. The FICO (Fair Isaac
Corporation), the best-known and most widely used credit score model in the United States, is calculated statistically, with information from a consumer's credit files. A FICO score can be valued between 300 and 850.

Carefully review your credit reports at least annually to make sure you are not subject to identity theft. Identity theft occurs when thieves obtain your personal information, which can    then be used to open new credit card accounts, obtain loans, or even clone your ATM card. Take action to protect
yourself by shredding sensitive documents and being extra careful when sharing confidential information online (even Facebook). Obtain your free credit report from the big three bureaus (Equifax, Experian and TransUnion) at annualcreditreport.com.

3. Create a 'rainy day' fund.     Develop a cash reserves bucket. Most people (before or after retirement) do not have enough cash reserves handy to get by for even two months in case of emergency or unemployment. They then start relying on retirement accounts, credit cards, family and personal loans to pay their bills and put food on the table. With many people unemployed for more than a year, you will need to save at least 12 -18 months of cash reserves to safely plan for your family and home necessities.

4. Increase your retirement savings.     Many Americans are significantly underprepared to retire by age 65 due to insufficient savings and end up dependent on Social Security as their primary income resource. Lack of planning and work-place financial education seems to be an ongoing
epidemic in today's society. Make a conscious effort to put off short term (instant gratification) purchases and instead make retirement savings a monthly expense item on your balance sheet with every paycheck. Dedicate at least 15% of your annual gross earnings for this goal. If you have the
ability to receive a company match (such as in your employer's 401(k) plan) contribute at least enough to receive this 'free' money.

A good rule of thumb to consider is that you may need 13 to 15 times your final salary in a lump sum to retire successfully (considering a 4.5% portfolio distribution rate in retirement). Work with a financial planner (such as a CERTIFIED FINANICAL PLANNER™ practitioner from the Financial
Planning Association)    to assess your specific retirement budget and lifestyle goals on paper and then put together an action plan to achieve them. Once you retire, continue working with your trusted advisor to implement an ongoing investment and income distribution plan to    keep you on track for the long run. Remember that in the end, you can't put your retirement on a credit card.

5. Protect your legacy.     Many people do not even have their basic will and legal documents in order (or may never have even completed in the first place). At a minimum, make a resolution to meet with an estate planning attorney in 2013 to complete your will, durable power of attorney, medical power of attorney, living will and HIPAA (Health Insurance Portability and Accountability Act) release forms. For those who care for minor children or incapacitated adults, consider to assign a
guardian and create    trusts to protect and care those you love. For those who have large or complicated estates, work with an attorney on advanced estate planning techniques.

Finally, carefully review all of your investment and insurance account beneficiary designations to make sure they mesh with your current goals and wishes for your family and estate, as specific account level beneficiary designations will override your will and a court of law.

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more: http://www.nasdaq.com/article/top-five-financial-planning-resolutions-for-2013-cm208212#ixzz2UExm8VN9

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