Later in life children – bringing up new needs

If you have opted to start a family later in life or if you are the more mature partner in a blended family with younger children from your new union, you’ll want to make sure your children are properly cared for and financially secure regardless of what happens to you. That’s why there are certain financial and estate planning issues that you should address right away.

You need a new will

You need to revise your will to include the legacy you wish to leave to your newest family member(s). If your will is out-of-date your surviving spouse and/or your child may not get the share of your estate that you wish them to have. As well, if you do not have a valid will and your child is under the age of majority, the money your child inherits may be held or managed by provincial or territorial authorities until the child reaches the age of majority. He or she would receive your inheritance in one lump sum and may not be capable of managing his or her sudden wealth.

Structuring a will and estate planning are especially difficult for blended families – and, when not done correctly, it can inadvertently eliminate one or more children, or even one branch of your blended family, from any share in your estate. You should know, too, that getting remarried voids any previous wills (except sometimes in Québec ).

Name a guardian

One of the most important parts of your estate plan is recommending a guardian in your will who will take care of your child if you and your spouse are unable to do so. Think carefully about who you should recommend.

The court is not bound to appoint the guardian that you recommend in your will, and may appoint someone else if the court feels you have made a poor choice. So choose wisely – and be sure to talk it over with the person you nominate.

Insure your child’s future

You want to leave a sufficient estate for your child and life insurance can help you do that. As your beneficiary, your child will receive the proceeds of your policy, usually without a tax liability. But insurance rates go up with age and your health could also become an issue, perhaps preventing you from obtaining any kind of insurance coverage.

So act now. Without doubt, a later in life child is an enriching experience and by making the right decisions now, you will ensure he or she is financially and personally protected come what may. Your professional advisor can help you make those decisions and the many others that will keep your financial life growing along with your child.

John Scholl CLU (Chartered Life Underwriter),CGA, B. Mathematics,

Financial Consultant - Investors Group Financial Services Inc John is available at (905) 450-2891 X529

David Pylyp; Stan Gelman Lawyer Mississauga would be pleased to prepare new wills and Power of Attorney Assets Give him a call at 905 270 5110.

How Much do you need to retire?

Your retirement income -- how much is enough?

Today’s retirees have a lot to look forward to. They are generally healthier, more active and engaged with everything their new life has to offer, and living longer. But all of that good news can also be the cause of some concern: Is it possible you will outlive your retirement savings?

Whether you’re already retired or soon to be retired, worrying about how far your retirement savings will take you can get in the way of moving forward and enjoying life – so let’s try to put that worry to rest with a six step plan for determining your retirement income longevity.

Step 1 – Profile yourself The level and frequency of income you will need (and/or the withdrawal rate from your investments held within Registered Retirement Savings Plans and other income-producing investments) depends on a number of factors:

• Your investment profile – for example, if you are a conservative investor, you would expect a lower return than a more aggressive investor, and therefore your withdrawals should be lower.
• Your years in retirement – your retirement could span 40 years and, generally, a longer duration requires a more prudent withdrawal strategy.
• Your income requirements – will you need to draw on investment income every month or can your defer or decrease income to offset periodic declines in portfolio value?

Step 2 – Assess your income from other sources Your retirement income will derive from sources other than your personal retirement savings such as the Canada Pension Plan/Québec Pension Plan (CPP/QPP), Old Age Security (OAS) and company pension plans. Add them all up.

Step 3 – Assess your expenses Add up your expected expenses – both essential and discretionary.

Step 4 – Assess the gap Calculate the gap between your income from all sources outside your personal retirement savings and your expenses.

Step 5 – Assess your withdrawal requirements Determine the amount you need to withdraw from your personal retirement savings/investments to bridge the gap between your income from ‘other’ sources and your expenses.

Step 6 -- Make adjustments If your expected withdrawal rate is not sustainable, based on the projected returns from your current savings and investments, you will need to re-evaluate your registered and non-registered portfolio with the aim of improving returns – or you may need to reduce the scope of your retirement plans.

It’s never too late to ease your retirement income worries. Your professional advisor can help provide the strategies and solutions that will allow you to enjoy your retirement to the fullest.

John Scholl B. Mathematics, CGA,

Consultant - Investors Group Financial Services Inc.

Wealth Management & Financial Planning

Phone: (905) 450-2891 X529 Toll Free: 1 (866) 799-2223 x529 Cell (416) 731-3660