This is a term that is used in so many different ways and so we wanted to lay out in simple language what it means when we talk about it.
Investment Allocation Strategy
“Don’t put all your eggs in one basket”
This old adage rings true and is at the core of what we do. Many of our clients have accumulated their wealth by having the concentration of their investment in their business. It has paid off, but they now realize it is time to move beyond.
We offer exposure to a comprehensive spectrum of Investment tools. Let’s face it, with Government of Canada 10 year bonds paying 0.5% in August 2020, this just won’t cut it on it’s own. Beyond traditional bonds and public equities, we have Long/Short, Real Estate, Infrastructure, Absolute Return, High Yield and Credit Structures. Coming soon we will also be able to offer Private Equity exposure to those who it is suitable for.
All this and more as CI Investments believes that the consideration of Environmental, Social and Governance (ESG) factors can help to enhance the long-term performance of our investments. Therefore, our Responsible Investment Policy underpins our commitment and guides or approach to responsible investing.
So how do we decide how much of what type of investment tool to put into your portfolio? We develop a written Investment Policy Statement for each part of your portfolio that has a different purpose. This policy is what drives how the portfolio is created, invested and rebalanced. It is unique to your needs, situation, tolerance for risk and can take into consideration other assets you have.
“It is not what you make, but what you keep”
Our team puts a unique structure in place that allows your portfolio to be incredibly tax efficient, especially inside corporate and open/non-registered accounts.
We also optimize your after-tax returns by putting certain types of investments in certain accounts because of they way they are taxed.
Example? Having low interest-bearing investments in your TFSA. For most people, it currently makes way more sense to have the growth part of your investments inside a completely tax-free account.
Another example is to keep taxes in mind for your corporate or open/non-registered accounts. It is extremely inefficient to have interest bearing investments or those paying foreign dividends in these accounts, so we try to avoid that.
Seems simple, but we find simple solutions are often over-looked.
With increasing tax burdens and constantly changing rules, it’s important to pay attention to the details and utilize all applicable tools at your disposal. This can be as simple as making sure your TFSAs are topped up in a timely manner each year to doing a full audit of your family and corporate structure making sure you are set up for not only efficiency, but to achieve your goals.
“The numbers don’t lie”
We create a detailed financial analysis starting with where you are currently, where you want to be, and what goals you have along the way. Once we have this crucial base plan in place, when opportunities or challenges arise, we can quickly and efficiently run scenarios to see how that will affect your plan. This allows families to make informed decisions.
“Maybe you can’t take it with you, but you can certainly make sure it gets to where you want it to go”
This is the single-most important tool for figuring out how your assets will be distributed after you’re gone. We work with couples to determine what you would like to happen on first death and then on 2nd death. We provide you an estate map, which is a visual to help you understand the flow of assets. We compare that to how you are currently set up, highlight the differences and communicate with your other professionals to help get all the required documents executed.
Although it’s not always easy to talk about, leaving a mess for a family that is already grieving loss is not the legacy clients want to leave. Our goal is to be with you every step of the way and help you create piece of mind for you.
We play devil's advocate in all areas of your planning. We look at the “what if” scenarios and what harm they may cause. This ranges from having your General Liability Insurance reviewed, to assessing what happens if you have a sudden need for $100,000 not already accounted for in your planning.
We look at death or disability of each spouse to see what the affect may be on the other and the family. We understand you cannot insure for every scenario but in our definition of wealth management, we give you the ability to make informed decisions.
We have access to Professional Trustees who can manage trust administration as well as provide professional executor and power of attorney services. Our investment process can continue after death to manage the assets in any short or long-term trust you have set up.
Foundation and Charity Administration
We understand philanthropic desires and will incorporate that into your financial, business and estate planning. We assist in setting up anything from an Endowment Fund at your local Community Foundation, running a “Planned Giving Account” through our services to helping you structure, launch, manage and administer your own Private Family Foundation.
Wealth Management Review
“If you don’t know where you are, how can you get to where you want to go?”
What good is planning if we don’t ever use it to measure our progress? On an annual basis we provide you with this update showing the numbers and in picture form where you are compared to where you had planned to be. It alerts us you if straying away from goals and your planned direction so if needed, it allows for adjustments to achieve the goals as planned. If the goals have changed, no problem, we adjust the plan, chart a new course and measure to achieve those.
We create a visual map of your family’s key information and keep it up to date so we can refer to and answer most questions within moments.
Cash Flow and Budgeting
Our team can complete a detailed analysis of your cash flow and help determine a budgeting process. Some clients can tell us down to the penny what they spend and although others fly by the seat of their pants and most are somewhere in between. If this is something you want help with, we are there for you.
“Creating Good Inheritors”
We provide the tools for our client’s children to learn about money, investing, financial goal setting, mortgages and other debt management. This is done face to face, with written resources, videos and in group settings such as our annual Financial Bootcamp for children in their 20’s to early 30’s.
When we take on a client, it is the whole family. We work with all generations and have the breadth and diversity on our team, so they have someone to relate to. As Family Wealth grows, this help in mentorship becomes one of the most important factors in growing and preserving multi-generational family wealth.