ZLC Foundation Charity Golf Tournament

On July 11, 2011 ZLC will host the annual ZLC Foundation Charity Golf Tournament. Sponsorship opportunities are available. For full details contact us.

May 5th, 2011 | Posted in Updates | Comments Off

How to protect your business from creditors: Part I

By Bill Finlay, BA, CA, and Gregory Gehlen, LLB

Business owners, whether entrepreneurs, proprietors or professionals, face a variety of financial exposure as they build and manage their businesses. In addition to the usual financial risks common to all business enterprises, this group may have personal creditor exposure through personal loan guarantees or exposure to professional negligence claims.

While the risk of a personal creditor claim can not be avoided completely in many circumstances, the consequences of those claims to the business owner and their family can be reduced through careful planning. A number of techniques exist to shelter assets from the claims of creditors. We will explore two of these strategies in this week’s blog post and another two next week.

Incorporation

Business incorporation is a good first creditor protection step for entrepreneurs and professionals. While this will not protect professionals from liability due to professional negligence, it provides protection from general business obligations, such as trade payables and leases of office space, vehicles or equipment. In the event of a business failure, claims from this group would be limited to the assets of the corporation. As part of this strategy, investment assets should not be held in the operating company, and profits should be removed (usually by dividends or bonuses) on a regular basis.

Divesting Assets

Non-business assets such as the family home should not be owned in the name of the individual personally, but instead should be owned by some other party such as the individual’s spouse or a family trust. By divesting assets in this way, the individual can make it less likely that non-business assets will become subject to business claims. Ownership through trusts can also provide additional benefits such as estate planning.

It is important to note that these techniques are not without the risk of themselves being attacked by creditors. Any asset-protection strategies must be reviewed carefully on a case-by-case basis for each particular individual.

Stay tuned for more strategies on protecting your business from creditors next week.

May 3rd, 2011 | Posted in Business Succession, Estate Planning, Insurance, Investments | Tagged , | Leave a comment

How to prepare your finances for retirement

During our working years, most of us focus on making money through our employment or business to first pay for our lifestyles, then to accumulate as much as we can for later in life. However, at some point our desire and need to accumulate changes to a desire and need for income.

Before retirement, we enter a period known as the “retirement risk zone.” This is the time that starts about 10 years prior to retirement, right through our retirement years, and is when many of us worry about exhausting our money and income while we are still alive.

Safety of capital and predictability of income become two prime considerations when making this transition from accumulation to income. Being sure you have enough income to cover your needs may be more important than preserving your money.

How do you convert your investments to income generating financial vehicles? How do you balance guarantees with returns? Is there a reasonable amount of capital risk you should take? How do you factor in income tax? Which financial vehicles are available and appropriate for you?

One of the strongest specialties of the professionals at ZLC Financial Group is helping our clients understand and answer these questions. The answer for every one of our clients is unique, and based on their own comfort zone, outlook, and needs.

Some of the financial options that cam provide you with regular income are summarized as follows:

blogpost-chart

Please email us if you have questions.

April 26th, 2011 | Posted in General, Investments, Retirement Planning | Leave a comment

How the Canadian dollar’s rise affects your portfolio

It has been a strong couple of months for the Canadian dollar. After opening the year roughly at par with the U.S. greenback, the loonie recently hit a multi-year high. Many investors are asking us whether the rise of the loonie holds any consequences for their investment portfolios. Let’s explore this topic a little bit.

Reasons for currency rise

In a recent email interview with a Vancouver Sun reporter, BMO’s deputy chief economist Douglas Porter noted the loonie’s rise could be attributed to a sizable upswing in commodity prices and a massive influx of foreign capital.

Since the loonie is benchmarked against the strength of the greenback, a weak U.S. dollar works in favour of our dollar. As the U.S. dollar loses ground, currency traders flock to more stable currencies such as the loonie for security, thus fuelling our dollar’s strength further.

Rising dollar mixed blessings for economy

As with many financial events, there are pros and cons to a rising dollar. On one hand, a soaring loonie translates into increased purchasing power. Just think of the snowbirds and travellers to the U.S. For them, a strong dollar means they are able to spend more for less. Increased purchasing power, combined with steady interest rates, translates into higher consumer spending. That’s good news for both the economy and for the markets.

On the other hand, a soaring loonie makes our exports more expensive, making life difficult for our exporters. But Canadian exporters are considered some of the most efficient and profitable firms in their fields, so although currency changes pose an obstacle, our exporters will likely adapt.

So what’s an investor to do? Remember that you’re an investor, not a currency speculator. It’s fine to educate yourself about currency movements, but don’t get carried away worrying about fluctuations. A rising loonie is usually no reason to make radical changes to your portfolio. We believe that holding a diversified portfolio of international stocks will hedge your risk against currency fluctuations and market conditions.

Questions? Opinions or predictions? Share your thoughts with our readers and post a comment below.

April 19th, 2011 | Posted in General | Tagged , , , | Leave a comment

Planning for critical illness can save your life

You’ve worked hard and planned for an enjoyable retirement. But what will happen if you have a heart attack or stroke, or are diagnosed with cancer? How will it affect your lifestyle, your savings, your family and future?

Cancer, heart attacks and strokes are more common than we like to think. While our chances for recovery are good, the associated costs can be high. Out of pocket medical expenses and associated costs can add up to hundreds of thousands of dollars.

If you have to sell investments prematurely or stop investing in order to manage recovery costs, your portfolio and future plans may never recover. So is there a solution?

By redirecting a small portion of what you invest each year towards critical illness protection, your investment portfolio will remain intact. Furthermore, if you have a critical illness, you will receive money to spend at your discretion. This includes paying off your mortgage or debts, renovating your home to accommodate a physical disability, covering travel expenses or lost income, or seeking alternative care.

Government health care programs may cover the cost of some services, but they rarely pay 100% of the cost, Also, many new treatments are not yet covered. With an aging population, and higher expectations for our health care, is it realistic to think this will improve?

You may believe it doesn’t make sense to take money away from your portfolio, but the impact on your portfolio can be relatively insignificant compared to that of a critical illness. As an added bonus, you can also choose to have the premiums you pay returned to you if you decide to cancel or a set period of time has elapsed.

Talk to your ZLC associate to see how critical illness insurance can help protect your investment portfolio and future plans.

April 13th, 2011 | Posted in Critical Illness Insurance, Insurance, Investments | Tagged , | Leave a comment

How the Japan earthquake has affected world markets

Youssef Zohny, portfolio manager at Van Arbor Asset Management

Japan, home to the third largest economy in the world, recently endured its strongest earthquake on record and a subsequent tsunami. The scope and level of human and economic destruction has reverberated with heartfelt sympathy from neighbors and countries globally.

Globalization has intertwined domestic economies with countries across the globe, so it’s no surprise that Japan’s natural disaster impacted the world’s financial markets and economies.

One consequence is that since Japan is an intermediary in the supply chain for many products, the earthquake has affected companies like Ford and Apple. As a result, Japan is not alone in absorbing an economic shock, as we recently saw foreign investors acting as net buyers of financials assets when liquidity was required in Japan.

In the longer term, Japan will rebuild its economy and there will be a counteracting stimulus to the loss in economic production. From previous experiences and history, we see financial markets and economic production rebounding fairly quickly after initially falling.

Overall, global markets and economies have shown themselves to be robust in dealing with crisis after crisis along the road to recovery.

Relevant news stories

Bloomberg: Apple’s Production of IPads and IPhones May Be Hurt by Japan Earthquake

The Wall Street Journal: Japan Quake ‘Most Significant’ Supply Chain Disruption Ever–IHS iSuppli

April 6th, 2011 | Posted in Investments, The Economy, The Markets | Tagged , , , | Leave a comment

What are the responsibilities of an executor?

If you have been chosen as an executor for a family member or friend, you may be wondering what this will involve. As an executor, you can expect your duties will typically span up to a year. On occasion, the responsibilities may extend for a longer period of time. This depends on whether there are trusts, complex issues or disputes to resolve.

The tasks that fall under your responsibility can range from locating the will and coordinating funeral arrangements to ensuring beneficiaries are notified. You will likely be tasked with securing the assets of the deceased and probating the will. It may be necessary to advertise for creditor claims, liquidate assets and pay debts through the assets of the deceased.

Other common responsibilities of an executor include:

  • Distributing inheritances
  • Making trust arrangements
  • Obtaining clearance certificates, which confirm payment of all amounts for which the deceased is liable to the government
  • Preparing financial statements for the estate
  • Closing out estate accounts

Unfortunately, sometimes being an executor includes the risk of personal liability. If an executor is negligent, they can be held liable by the beneficiaries and creditors of the estate they are executing. This article details some instances where executors can be found negligent: http://bit.ly/fmKDX9

Executing a will can be an unfamiliar and involved process, so it’s worthwhile to seek out advice from a professional if you need assistance. ZLC has an Executor Checklist that details the duties, responsibilities and obligations of an executor. Email us for your copy.

March 29th, 2011 | Posted in Estate Planning, General, Investments | Tagged , , , | Leave a comment

Three Important Benefits That Health Insurance Can Provide

In addition to basic advantages of health insurance such as covered prescriptions and dental care, there are three other valuable benefits that health insurance can offer you.

1. Income Replacement

If a disability or illness were to prevent you from being able to work, an income replacement plan can help protect you. A plan of this nature ensures you will receive a monthly tax free income, in accordance with your standard of living, until you reach the age of 65.

2. Additional Income

Imagine you were diagnosed with a serious illness or faced some kind of health emergency. The cost of treatment and other unexpected expenses could be a financial hardship for you and your family. Rather than dipping into savings earmarked for your child’s college education or your own retirement, consider purchasing critical illness coverage. This type of insurance can provide you with the cash you need to handle the costs of up to 22 covered conditions

3. Assisted Living

Have you thought about living arrangements for when you and your spouse are older? Do you want to remain in your house or move to a care facility? Long term care programs, like the one that ZLC offers, provide you with a daily benefit to help cover the costs of care, regardless of whether you remain in your own home or move to a seniors residence.

If you’re interested in learning more about the types of health insurance ZLC can offer you, please email us.

March 22nd, 2011 | Posted in General, Insurance | Tagged , , , , | Leave a comment

Choosing an executor for your will

Determining who you should choose to be your executor can be a challenging decision. It’s important that both you and the individual you decide on understand the duties they will be assuming as an executor.

Your executor will be responsible for ensuring all of your last requests, as outlined in your will, will be carried out. This can be an involved and time consuming process, so it’s important to pick your executor carefully.

After making your decision, consult your chosen executor and ensure they feel comfortable with their role. Before the executor accepts the role, they should consider the following:

  • Can I handle family conflicts that may emerge as a result of executing the will?
  • Will my responsibilities be ongoing? Complex issues, trusts or disputes can span several years.
  • Do I have enough knowledge to make the complex financial and business decisions that may be necessary?
  • Are all assets outlined in the will located in the same country or province?
  • Will I have the time and energy to ensure the last wishes in the will are carried out

At ZLC, we can help ensure your executor is well-informed by providing an Executor Checklist which outlines the duties, responsibilities and obligations of an executor in detail. Email us for your copy.

March 15th, 2011 | Posted in Community, Estate Planning, General, Retirement Planning | Tagged , , | Leave a comment

How to choose the right amount of life insurance

By Matthew Anthony, B.A., CFP

If you are looking at your insurance needs for the first time or are reviewing the plans you already have in place, there is one important question you must ask: How do I know I have the right amount of life insurance?

To determine what amount of life insurance is right for you and your needs, there are several factors to consider:

  • What financial goals do you want to achieve for your surviving family?
  • Do you want to eliminate debt from credit cards, loans or mortgages?
  • How much capital is needed to provide ongoing income for your family?

A number of online calculators are available that can give you a good starting point. From there, your financial planner can walk you through a good “needs analysis” to provide you with an appropriate amount of coverage for your situation.

Whether your goal is income replacement, estate planning or business succession planning, defining your financial goals as a starting point can easily determine the amount of insurance that is right for you.

March 10th, 2011 | Posted in Estate Planning, Insurance, Investments, Retirement Planning | Tagged , , | Leave a comment