I’ve got this; things are on autopilot. But how do I make sure I stay on track? (50’s)
So you’ve been on track with your commitments for life and you feel more in control now. Once you’ve passed certain milestones in your life and career, your dreams start to take shape. Checking in on your plan regularly to make sure it fits your plans for life and allows you to be able to fit in those extras as well as keep on track to the future of your dreams is key. At this stage, it’s also a great idea to keep a more careful eye on your efforts to save for retirement and make sure you are firmly on track.
Let us help you assess and change your plan with the solutions that make sense, no matter how trouble-free or full of twists and turns your life might be. Whether your concerns are retirement or that lifelong dream of a renovated family home, we can help.
A winning financial game plan is not glamorous, it’s just common sense. For more information or to set up an appointment to discuss your dreams, please feel free to contact our office.
Case Studies
Keanu – the Value of Coaching
Keanu was doing well in his career. He had moved up in the corporate world but knew from personal experience how fragile that world can become. He couldn’t rely on the corporation always being there for him.
He was saving regularly through his employer-sponsored group plan, but just not enough.
It’s our standard MO to encourage those contributing on a regular basis to increase their savings by an amount equal to or greater than inflation each year. We cheat a bit by encouraging them to round up. But that wasn’t going to cut it for Keanu. He was saving 10% but want to be at 15%.
After hearing about our “professional nag” service, he agreed to let us nag him to increase the amount they took off his paycheck by 1% of his salary each year for 5 years. That amounted to 50% increase in his annual savings over 5 years. An increase based on 2% inflation would have amounted to only 10.4%.
Today he continues to save more than he ever would have on his own.
Fred and Ginger – Tax Planning
Fred and Ginger had never worked with an advisor and were hesitant to, but after years of seeing their friend’s confidence in their finances strengthen, they finally came in to see us. In conducting our Discovery Meeting, we saw some opportunities right away. By making two very simple changes just to the types of accounts they were investing in, we estimated we could save them close to $18,000 in taxes over the next 6 years.
Still nervous about investing, we made their portfolio quite conservative, so while they did see their investments go down a little bit during the March 2020 COVID-19 pandemic decline, it was mild enough that they were easily able to sleep at night and stick with their plan.
Elvis – Charitable Gift Planning
Our very favourite charitable giving story is from quite a few years ago, back when flow-through share donations were more favourable.
We had a client invest $50,000 with the intent of ultimately donating it all. The plan was for him to invest the $50,000 knowing that he would receive $30,000 as a tax credit (bringing his cost down to $20,000). A year later he would donate whatever it was worth, hoping that it would at least be $20,000.
As it turned out it grew quite nicely (to about $80,000). So. instead of donating the planned $50,000, Elvis decided to donate it all, so in the end…
- he initially gave up $50,000 in cash, but in exchange
- - a charity received $80,000 and
- - he received a reduction in taxes of $65,000 ($30,000 inflow through credits plus another $35,000 in charitable tax credits),
- meaning he actually came out ahead by around $15,000 in spite of giving $80,000 away.
Disclaimer: All figures are approximate. While this was an actual event, it is an extreme example of a positive outcome and the credits are just not as good as they used to be. It is a real-life example of what we try to achieve, but in the current environment, a repeat of this outcome is highly unlikely.
NOTE: The case studies above are based on true events. Names have been changed to protect privacy.