That’s a massive gap—and it’s widening at a time when more Canadians are rethinking their financial strategy. The survey of 1,045 Canadians found that 52% said economic uncertainty is causing them to consider creating a financial plan or overhauling an existing one.
Having a plan is clearly beneficial, so why aren’t more people doing it? According to the survey, there are three culprits: cost, complexity, and confusion about what a financial plan even is.
The barriers holding Canadians back
Nearly half (45%) of survey respondents haven’t worked with a professional planner before:
43% say they’re unsure about the process or whether it’s worth the money
42% think it’s too expensive
Only 44% have a “very clear” understanding of a financial plan entails
But here’s the thing:among the 55 per cent of Canadians who have worked with a professional planner, 56% say the value was completely worth the cost. Another 37% said it was somewhat worth it—so that’s 93% who felt they got their money’s worth.
The KPMG report shows that 53% of Canadians believe a financial plan is “extremely valuable,” but it seems that misconceptions about cost and complexity are preventing them from taking that next step.
DIY plans beat no plan, but professional guidance wins
Of the survey respondents, there are three groups: 55% have a professional plan, 25% created their own, and 20% have nothing. Those who went the DIY route feel significantly more confident than those without (72% vs. 36%), but they still lag behind those who sought the help of a professional planner.
The generational split on technology
Age also seems to play a role in how Canadians view financial planning:
54% of Gen Z (ages 25–30) would prefer a self-service digital tool to a human advisor
41% of Millennials (ages 31–45) want tools plus human support
Gen X (ages 46–60) is evenly split across all three options
56% of Baby Boomers (ages 61–79) want to work exclusively with a human advisor
There’s one thing every age group agrees on: 72% want real-time access to their financial plans, saying it would enhance their experience.
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The bottom line
The survey data appears compelling: professional financial planning delivers measurable results. But, at the end of the day, some plan is better than no plan. If cost or complexity is holding you back—or you simply prefer using online tools to do things yourself—have a go at creating your own plan. You can always check in with a financial advisor for feedback and suggestions to help boost your confidence and ensure you’re on the right track towards a comfortable retirement.
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It is a story about two young adults outraged by the amount of wealth lost to taxes—$659,000—when their parents, in their early 60s, both passed away within a year of each other.
I can sympathize with the children, thinking they were going to get this much money only to find they were getting substantially less. Without understanding why, I’m sure it was confusing and hurtful. Let’s walk through why the tax was so high and what if anything could have been done.
Their father died, after their mother, in December, so he had a full year of income, which I’m assuming was $175,000. There was an RRSP worth $715,000, and I will assume capital gains on the cottage of $850,000. This combination resulted in taxes of about $659,000.
Hard to fix after the fact
What could they have done to lower the amount of tax? In this case, when death is sudden, there is not much you can do. The father’s salary is taxable and there is no getting around that.
The same goes for the RRSPs; there is no getting around the tax. The children were named as beneficiaries of the RRSPs, which saved probate fees, but you can’t transfer an RRSP to an adult child like you can a spouse. The funds are withdrawn and the full value goes to the children, but the estate must pay the tax on the value of the RRSP. Regardless, the children end up paying the tax.
It is possible to reduce the amount of capital gains paid by designating either the house or cottage as the primary residence and naming the property that has appreciated the least as the secondary property. If there is a bright side to capital gains tax, it is that 50% of your gain is tax-free, so on a $850,000 gain you only pay tax on $425,000.
When you add it all up—salary $175,000, plus $715,000, plus $425,000 taxable capital gain—that is taxable income of $1,315,000 and tax of $659,000 or 50% of the total income.
This is why it looks like the government took all their parents’ money. The children inherited the house and cottage and the only cash money they had to pay the taxes was the money from the RRSP. Out of $715,000, they were only left with about $56,000 between the two of them to cover the funeral, accounting, and legal fees, and to maintain the properties until one or both could be sold.
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The takeaway: plan for many outcomes
I’m sure when their parents did their planning, if they did, they assumed they might live to age 90, drawing down on their RRSP/RRIF over time to minimize the tax. They may have sold their principal residence and moved to the cottage, designating it as the principal residence. This would have deferred—and, with inflation, shrunk—the capital gain. They may never have considered what the situation would look like if the unexpected happened.
If they had, they may have considered purchasing life insurance. Life insurance is for “just in case” the unexpected happens. They could have purchased some term insurance with an option to convert to permanent insurance if taxes continued to be an estate issue. The insurance doesn’t minimize the tax, but it provides the children with tax-free money right away—money that gives them time to pause and think rather than feel under pressure to sell properties at a time that may not be opportune.
This story serves as a good reminder that when doing your planning, consider what the picture may look like if the unexpected happens and then decide if you want to do anything about it. In this case the parents may have been aware, and understood the tax implications, if they both passed away early. Maybe they felt the children would just sell one or both properties and everything would be good. For the adult children this was unfamiliar territory with a big learning curve.
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With over 30 years as a financial planner, Allan is an associate portfolio manager at Aligned Capital Partners Inc., where he helps Canadians maintain their lifestyles, without fear of running out of money.
An annual research study from Northwestern Mutual casts the spotlight on some of Gen X‘s most pressing retirement issues as the group approaches its golden years.
First, Gen Xers said they’d need $1.57 million to retire comfortably, or $310,000 more than the “magic number” national average, according to the research.
More than half (56%) of Gen Xers thought they’d likely outlive their savings, while just 40% of Boomers and beyond felt the same, per the report.
Across all generations, Gen X was the least likely to report the expectation of an inheritance.
Additionally, Gen X respondents were more concerned than millennials or Boomers about paying off their mortgage: 25% compared to 24% and 18%, respectively.
Gen X also reported less understanding of some critical factors that could impact their retirement plans. For example, they had a looser grasp on how inflation (53%) and taxes (49%) could affect their financial plans, compared to 66% and 62% of Boomers.
What’s more, 50% of Gen X admitted to a “common blindspot” when it comes to managing their finances: They said they’d prioritized building wealth without doing enough to protect their assets. Just 35% of Boomers felt the same.
“Growth without protection can leave people vulnerable,” Jeff Sippel, chief strategy officer at Northwestern Mutual, said. “Especially as you get older, safeguarding what you’ve built is just as critical as continuing to build. A holistic plan should account for both.”
The report sheds light on just how many Canadians are leaving their families financially at risk—and why so many are putting off getting coverage.
How wide is the coverage gap?
PolicyMe’s study found that a staggering 42% of Canadians either don’t have life insurance or aren’t sure if they have it, with almost two-thirds of those who are uninsured saying they aren’t likely to get coverage in the next five years. Families with kids are the hardest hit: almost half (49%) of parents saying they probably won’t purchase life insurance in that same period.
Yet one in four Canadians without coverage aren’t confident that their families would be financially secure if they passed away unexpectedly.
Life insurance changes that. Among those with coverage, 80% say they’re confident that their loved ones would be financially protected.
It’s clear that life insurance provides peace of mind—so why are so many Canadians still putting it off?
Among those surveyed, more than a third say they don’t have life insurance coverage because it’s simply too expensive—and 42% of those people have kids at home. About 10% say that the high cost of living has delayed their plans, non-essential expenses typically the first to go when budgets get tight.
Medical requirements are another barrier. Just over a quarter (26%) hesitate to buy life insurance due to the medical questions that many policies require.
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Perhaps most striking, though, is that 27% of Canadians—more than one in four—believe they don’t need life insurance.
Consider a family of four living on a single income. If the primary earner were to pass away unexpectedly, the loss of income could put a major strain on day-to-day living—expenses like rent or a mortgage, groceries, and childcare add up quickly. A life insurance payout could replace lost income, cover debts, and give the surviving parent breathing room to focus on family instead of finances during a difficult time.
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The benefits of getting covered sooner
When it comes to life insurance, starting early is key. Life insurance costs rise an average of about 8% each year you delay, so securing a term policy when you’re younger means you’ll enjoy the lowest rates for longer.
But getting coverage late is better than never—and it’s probably more affordable than you think. According to PolicyMe, the average cost of a 20-year term life insurance policy is around $20–30 per month for $500,000 in coverage if you start in your 30s.
And gone are the days of having to visit an agent and endure seemingly endless sales pitches. Many providers offer online quotes, while some let you complete the entire process online—from getting quotes to completing the medical questionnaire to finalizing your coverage.
Life insurance doesn’t have to be complicated or costly; it’s about making sure your loved ones are protected and giving yourself peace of mind, no matter when you start.
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In fact, the proportion of Canadian women without biological children has been rising steadily, up to 17.4% of those over 50 in 2022. And family sizes are smaller than they used to be, which lowers the chances that the kids people do have will be nearby, available, and capable of helping. “Many people assume their adult children will step in to help with things like tech issues, downsizing or health care,” says Kara Day, a financial planner in Vancouver. “If you don’t have kids to lean on, retirement looks different, and it requires more intentional planning.”
So what’s a childless retiree-to-be to do when it comes to prepping for old age? We spoke to the experts for some advice. Here’s what they recommended.
Build a community
A big family with lots of kids and grandkids, siblings, and niblings is, at its best, a built-in community where people look out for each other. If yours is small or non-existent, that’s not a problem, says Day, you just need to DIY. “Without children to step in, you need to build your own safety net,” she says. “That means building your own support system, such as friends, neighbours, or community groups.”
Another way to put it: “Make friends with younger people,” says Milica Ivaz, principal financial planner at Sensible Financial Solutions in Victoria. The advice is a bit tongue-in-cheek, but it’s not just for the times you need these new friends to lift heavy things for you. It’s also to help keep you happier and healthier for longer.
“Feeling isolated impacts your mental capabilities,” Ivaz says, adding that joining social groups and staying relevant matters as well. “I’ve seen clients that don’t know what to do with themselves when they retire, and they don’t have that social interaction, and they’re not happy.” The World Health Organization backs Ivaz up: “Research shows that social isolation and loneliness have a serious impact on physical and mental health, quality of life, and longevity,” it says.
Housing and transportation for advanced age
When you choose a place to live, what factors are on your must-have list and how will that change as you get older? No one likes to imagine losing their mobility or ability to drive, but these are common occurrences that should be planned for in advance. “We won’t be driving forever,” Ivaz says. But if you choose a living situation with good walkability and access to public transit, she adds, “it will be easier.”
Larger homes with larger yards require more upkeep, which is one reason downsizing is so common among seniors (another is the opportunity to free up more capital). One lesser-known option that’s kind of halfway between buying and renting is a life lease, in which the property buyer pays a purchase price and then monthly maintenance fees in order to take up long-term residence (but not ownership) of a home.
If you think you’ll want to stay in your house as you age, there’s the option of renovations to improve accessibility, such as upgrading your bathroom to include a walk-in shower with room for two (that’s you and your care aide) or widening doorways to accommodate a wheelchair. Ivaz also suggests setting up a home equity line of credit (HELOC) for the maximum amount—even if you don’t need the money now—in order to “prevent any fraudulent actions with the property” and provide a source of cash should the need arise when you do move out of your home—for example, before and during a house sale.
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As for that time in the future when you may no longer be able to care for yourself, Day recommends thinking about it early. “Research local services like tech help, home care, or senior centres before you actually need them,” she says. And if you think long-term care (LTC) might be in your future (as it is for many), look into your options early on, “as the cost can vary quite a bit.” Private LTC facilities in B.C., for example, can cost between $7,000 and $18,000 per month, she says, while publicly subsidized options (reserved for lower-income seniors) are more affordable. Depending on what you’ve got saved for retirement, you might want to consider long-term care insurance.
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Get your finances and services in order
We can’t know what the future will bring. Surely today’s 70- and 80-somethings never anticipated needing help connecting their new dishwasher to the wifi (why is that a thing, again?). But from mowing the lawn and snow removal to meal prep and in-home care, there are plenty of costs associated with the declining abilities (or motivation) that tend to come with aging. And these need to be planned for, Day points out. “While child-free adults may have saved more during their working years, they’ll likely face higher expenses in retirement because they’ll need to pay for services children often provide,” she says. “Even small tasks, like moving furniture or setting up a new phone, may require paid help. So budgeting for those extra supports is important.”
Ivaz, for her part, doesn’t think a child-free retirement is necessarily more expensive—many of her clients in this age group are helping adult children buy a home, for example—but she agrees that it’s a good idea to account for all potential future costs when creating a retirement plan. She divides up retirement into three phases: the “honeymoon” during which you might spend more on travel and activities, the “settled” era where you’re focused more on living in your own space, and the phase “where you need some help.” How much money you need for each of these is “very personal,” she says, so Ivaz suggests coming up with what-if scenarios and looking at how you’ll cover those costs.
Another way to make life easier for future you is to simplify things as you approach retirement. “If you can, consolidate accounts so you’re not juggling too many logins and statements,” Day suggests. “Keep a list of accounts and passwords in a secure location.”
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Prevent fraud, identity theft and bad decisions
There’s no shortage of horror stories about seniors losing their life savings to scams or unscrupulous acquaintances. And it seems like the fraudsters are getting more and more sophisticated. There’s also the worry of cognitive capacity: what if, in the early stages of mental decline, you withdraw all your money out of your safe exchange-traded funds (ETFs) or mutual funds and spend it on a hot but risky stock? Luckily, there are ways to stave off these kinds of issues.
Day suggests starting with basic security. Set up account alerts to notify you of any unusual activity, using password managers, and enabling two-factor authentication. “Another smart move is to automate bill payments to avoid missed payments or sneaky overcharges,” she says. Speaking of bills, there are also business practices out there that are fully legal but morally questionable, like letting people pay current market rates for internet download speeds that are a decade or more out of date. Consider marking your calendar for regular check-ins that you’re getting the best possible deals on the services you need—and no more.
There are other safeguards you can put in place, too, Ivaz says. For example, add a trusted contact person to your financial accounts. This is not so they have access to your money, but so the bank can call them in case of suspicious activity. Add beneficiaries (a successor holder in the case of your spouse) to your investment accounts now so they can’t be changed later, even by your designated power of attorney should you become incapacitated. Another trick, Ivaz adds, is to delay receiving Canada Pension Plan (CPP) and Old Age Security (OAS) benefits until age 70. You instead dip into other accounts, such as RRSPs, if needed in the meantime—not just so you can draw a higher amount, but for security, too.
“Your CPP amount will not be exposed to market fluctuation,” she says, nor is it subject to your own personal investment decisions. Plus, your own savings can run out if you live to a ripe old age, but government benefits are for life.
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Running a business means balancing vision with execution — and if you’ve ever tried building a business plan from scratch, you know it can feel like juggling spreadsheets, projections, and endless “what ifs.” That’s why LivePlan was created.
Automatic financial forecasting — no messy formulas, just clear reports.
One-page plan builder to simplify big strategies into actionable priorities.
Growth tools like milestone scheduling, performance tracking, and budgeting.
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Whether you’re pitching to investors, planning your next phase of growth, or just trying to bring structure to your big ideas, the web-based LivePlan platform gives you the clarity and confidence to lead smarter.
Running a business means balancing vision with execution — and if you’ve ever tried building a business plan from scratch, you know it can feel like juggling spreadsheets, projections, and endless “what ifs.” That’s why LivePlan was created.
While some financial advisors recommend the 50-30-20 rule, where 50% of your pay goes to fixed expenses, 30% to discretionary and 20% to savings, putting aside just 10% of your take-home pay for savings is OK, too. “We can be as efficient with that 10% as we can possibly be… meaning we could put your savings in a diversified portfolio where the expected returns are going to be higher and over a longer period of time.”
Ayana Forward, a financial advisor and founder of Retirement in View in Ottawa, acknowledges how hard it can be for single women—and all women—to create a plan to invest, particularly early in their careers. “You have all kinds of competing priorities,” she says, including possible childcare expenses, a mortgage, car payments and school debts. However, Forward encourages women to begin saving anything they can as soon as possible to build habits and benefit from compound interest, which is when your money’s interest starts earning interest of its own.
Here’s how that can look: Let’s say you take $100 a week from your miscellaneous allotment and invest it at an interest rate of 5% and watch it grow. After 30 years, if you had put that $100 in a savings account with no or a low interest rate, you’d only have $156,100—but because you invested it, you’d have $345,914. (Calculate your savings with our compound interest calculator.)
Prioritize what you love
What are your absolute must-haves in life? Your non-negotiables? You don’t have to give those up—you may just have to find an alternative way to make them work while meeting your savings goals. “My client, who is a college instructor, loves to travel, and her trips are usually tax deductible,” says Hughes. But to be able to afford her trips while continuing to save, she picked up a part-time job. “It gave her some extra income since she was determined to meet her goal, which was to own a place of her own,” says Hughes.
Whether you pick up a side hustle or not, chances are there will still be a few sacrifices you’ll need to make. It comes down to looking at your budget and deciding what you want to prioritize in the immediate time period, says Cornelissen, and deciding what you can let go of for a while.
Or it can relieve you from doing the opposite, over-saving for fear of not having enough money. Knowing how much money is going in and going out of your account is key to making a plan for your money.
Revisit your employee contract
If you’re employed full-time, find out if your company offers a pension or an employer-sponsored plan, such as RRSP matching (where an employer contributes the same amount as an employee to a registered retirement savings plan). This will help you determine how much you need to save for retirement. “If you don’t have a pension, you’ll need to save more than someone who has a pension,” says Forward.
Also, when planning for your retirement explore government income sources that may be available, like the Canada Pension Plan (CPP) and Old Age Security (OAS). “You can go into your My Service Canada account to get those benefit statements so you know what you’ll be receiving from those programs,” says Forward. (You can log into your My Service Canada account using a unique password or use your bank account log in.)
Artificial intelligence is expected to transform the way companies do business, including those in financial planning and investment management. That means financial advisors need to get onboard or risk being left behind. “They have to realize an AI apocalypse is coming,” said Craig Iskowitz, CEO and founder of Ezra Group, a strategy consulting firm to asset managers and broker-dealers. Of course, financial advisors have been using some technology, like financial planning software, for years. Others are now embracing AI to help with operational workflows, such as meeting summaries and emails. Yet experts expect a dramatic shift as AI eventually becomes more entrenched in the day-to-day investment process. “Large language models, such as OpenAI’s GPT and Anthropic’s Claude, can deliver significant productivity gains because they can process vast amounts of text data, such as annual reports, debt documentation, news articles, or broker research, much faster than humans,” Vincent Gudsdorf, head of AI analytics and digital finance research at Moody’s Ratings, wrote in a report earlier this month. “These models can automate the creation of documents like earnings reports or market commentaries and generate investment ideas,” he added. Right now, AI is still in its infancy as infrastructure is built out, said Leo Kelly, founder and CEO of private wealth advisory firm Verdence. His firm has just under $4 billion in assets under management. “There are applications but they are very rudimentary and people don’t know how to use them yet,” he said. Those he calls “deniers,” who don’t want to embrace AI, will be fine in the early stage, Kelly said. But “the light at the end of the tunnel is a freight train [aiming] for them.” There are also early adopters, who may be rushing into the technology and could see challenges down the road, and those who are thinking strategically and building out their technology, he said. The latter will be the most successful, said Kelly, whose firm is currently rebuilding its technology stack. “We are basically getting our arms around our data and organizing and structuring our data in a way that it is clean and precise,” he said. “Then you can take AI and start applying applications and those applications will be highly effective if you have taken your time.” It is a massive commitment, he noted. “The payoff will be huge if you do it right,” he added. AI ‘wealth whisperers’ Eventually, regulators will get their arms around AI and understand that the data is protected, predicted certified financial planner Timothy Welsh, president of wealth management consultancy Nexus Strategy. Then, the conversation among investors will go from “who is your money manager” to “which AI are you using?” he said. “If you think about creating asset allocation and picking stocks, bonds [and] mutual funds … [financial advisors] are relying on intelligence from the asset managers of the world,” he said. “But that research is the core stuff that AI can do more than humans.” Still, AI will help financial advisors do their jobs better — not necessarily put them out of work. Welsh envisions advisors having more time to talk with their clients. “Therapist kind of stuff,” he said. “Those skills are way more in demand.” AI tools can also dramatically enhance background searches, data analysis, portfolio analysis and risk analysis for financial professionals, Kelly said. “All of this work they can do radically faster than they used to,” he said. “They can take in more data and make better decisions.” Iskowitz at Ezra Group sees AI leveling the playing field in what he calls the “democratization of EQ,” or emotional intelligence. All the data now available on the internet, like social media posts, will help advisors learn more about their clients and therefore help them relate better, he predicts. “The real golden ticket is going to be in gathering terabytes of data and sifting through it intelligently and coming up with pattern matching,” he said. “That’s called machine learning, but doing it much quicker and over much more unstructured data … emails, notes, social media, posts, videos that AI can quickly review and then drill down and distill the exact insights for each prospective client.” AI can also help managers analyze which clients to pursue and how to speak with them based on their backgrounds, he said. In about two years, Iskowitz predicts a chatbot will be able to provide full financial plans directly to clients, interact with them and give them the option to open accounts with the click of the mouse. “[It] will do all the work for you, put you in the right models, adjust it all and go,” he said. “These AIs are going to be like wealth whisperers.” What to do Nexus Strategy’s Welsh believes financial advisors should begin getting comfortable with current AI capabilities. “Get started today. This is something you can get ahead of,” he said. “Just keep it in the box right now — operational efficiencies. There is no issue with that.” For Verdence’s Kelly, the first thing advisors should do is ask themselves who they are — an early adopter, a denier or a strategic thinker. “Don’t try to fool yourself into that answer,” he said. “If you want to change things, you have to change.” They should then evaluate where they are in the marketplace — what are their competitive advantages and disadvantages. After that, decide if you need to invest in the people and technology, partner with a larger firm or, if you work at a big bank, decide if you want to leave since the big banks have to also manage risk and the capability of these AI tools, he said. Those who run small mom and pop firms managing their own portfolios should start thinking about partnering with a larger financial advisor firm or technology company, Kelly said. Otherwise, “AI is going to monetize you out of business,” he said. Iskowitz suggests advisors branch out and also go into areas like alternative investments, tax and estate planning, more advanced retirement planning, insurance and annuities. They can also use more visual tools, like an asset map that does a visualization of a client’s financial life, he said. Advisors should have regular conversations with their technology vendors, who are already hard at work deploying AI features, he advises. “Don’t go and buy anything new. It’s already coming to you. Just wait,” he said. “Your financial planning software is launching AI functionality. Your meeting organization tools are launching a functionality.” Also, make sure you train your internal staff and let them know no one is getting fired, he advised. Anyone whose work is being replaced can be moved elsewhere in the company, he said. “It’s a learning curve. Like any software, you need to spend time to train your staff and train them in the ways that they feel comfortable,” he said. “AI can help you.”
Fee-based advisors, who charge based on asset size, typically work better for people with more assets and dollars to invest.
Tam said fee-based financial planning aligns the motivation of an advisor with the client.
“They’re not going to be motivated to do what we call churning your accounts, or selling and buying similar mutual funds, so they can make a commission,” he explained.
On average, fee-based planners charge a flat rate of 1% and provide holistic advice such as tax planning, estate planning or even everyday financial planning during uncertain economic times.
While uncommon, fee-only, advice-only financial planners are another way to seek help with your money. This type of planner reviews the client’s finances and makes recommendations. It’s then left up to the client to implement those recommendations.
These advisors simply provide guidance and do not sell investment products, Tam said.
“It truly is a decoupling of advice versus sales, which we think is a very positive thing,” he said.
The fee is typically charged at a flat rate, Tam added.
6. Beating the Street by Peter Lynch (Simon and Schuster, 1993)
“Beating the Street is one of the first investing books I ever read, and it’s stayed with me because it makes stock investing accessible to beginners. There are many highly analytical and slightly scary books on investing, but Peter Lynch managed to make stocks exciting and approachable using simple, real-world examples drawn from his own experience as a high-performing fund manager. It’s an oldie but a goodie.” —Aditya Nain, MoneySense contributor, author, speaker and educator about Canadian investments, personal finance and crypto
Master the basics of personal finance—at any age
7. Seventeen to Millionaire by Douglas Price (self-published, 2022)
“This book feels like your [parents] sat you down and taught you everything you need to know about money, before you ever encountered any of it. It gives you the opportunity to take on the world, with easily digestible knowledge in your back pocket.” —Reni Odetoyinbo, financial educator and content creator (Reni the Resource)
8. I Will Teach You to Be Rich by Ramit Sethi (revised edition, Workman Publishing Company, 2019)
“A great book for anyone who wants to understand how the financial system works. I love that this book is incredibly practical. It breaks personal finance down in such an easy-to-understand way and helps you create systems around your finances that make things less stressful.” —Reni Odetoyinbo
9. How Not To Move Back in With Your Parents by Rob Carrick (Doubleday Canada, 2012)
“This book teaches the basics of money management to young adults. It helps teach good financial habits for young people and their parents!” —Shannon Lee Simmons, an award-winning Certified Financial Planner, speaker, bestselling author, Chartered Investment Manager, founder of the New School of Finance, the money columnist on CBC Radio’s Metro Morning and a financial expert on the concluded The Marilyn Denis Show
10. The Wealthy Barber: The Common Sense Guide to Successful Financial Planning by David Chilton (Stoddart, 1989)
“This was the first personal finance book I ever read, after learning personal finance at my father’s knee. Thanks to his coaching, I have filed my own income tax returns every year since I was 16. And it still stands up. The literary conceit of the titular barber allows author David Chilton to walk through scary-sounding money concepts in a relatable way. There’s a reason it’s sold millions of copies.” —Sandra E. Martin, two-time MoneySense editor (OG editor-in-chief Ian McGugan hired her in 1999, and she returned in 2019 as editor-in-chief), and currently The Globe and Mail’s standards editor.
11.The Only Investment Guide You’ll Ever Need by Andrew Tobias (revised edition, Harper Business, 2022)
“Let me give a shout-out to the book that changed my life: The Only Investment Guide You’llEver Need by Andrew Tobias. Until I plucked this book at random out of a box of discards while working a night shift in 1979, I was a university student who thought money was boring and inexplicable. Tobias changed all that. He was smart, funny and human. He made money fascinating. He also delivered a truckload of practical wisdom. I remain a fan of this personal-finance classic—now updated many times, not just for its sage advice but also for its big personality.” —Ian McGugan, founding editor of MoneySense, and columnist for The Globe and Mail.
12. Stop Over-Thinking Your Money!: The Five Simple Rules of Financial Success by Preet Banerjee (Penguin Canada, 2014)
“If you’re looking for no-nonsense, clearly explained money tips, pick up this easy-to-read volume by Canadian writer and podcaster Preet Banerjee. He boils personal finance down to five rules: disaster-proof your life, spend less than you earn, aggressively pay down high-interest debt, read the fine print, and delay consumption. Do these five things and you’ll be in better financial shape than you are today.” —Jaclyn Law, MoneySense’s managing editor
Find the courage to chase your dreams
13. I Could Do Anything If Only I Knew What It Was by Barbara Sher (Dell, 1995)
“I did all the ‘right’ things in my career. I went to business school and got a great corporate job. If I had just stayed on that path, money would have taken care of itself. Except I didn’t love the job. I was stuck. I needed something to crack my paradigm about what ‘right’ meant for me. This book did that. One transformational exercise was answering this question: ‘If you could do anything and knew you would be successful, what would it be?’ This was a light-bulb moment for me. My answer was to work in TV news, and I realized that it was just fear that was holding me back. As terrified as I was, I quit my job and pursued what I really wanted. I made less money than I would have in the business world, but the big switch was worth every penny.” —Bruce Sellery, CEO of Credit Canada,host of Moolala on SiriusXM, the Money Columnist for CBC Radio
All the while, you’ve got a serious case of FOMO every time you check social media—all those friends who are jetting off on lavish vacations, buying new cars and splurging on cottages. How are ordinary Canadians actually doing this? And how can you get ahead and save more?
What’s the average savings for Canadians in their 30s? How much should they have saved?
A lot of Canadians are managing to save, despite the above financial challenges and obligations. According to Statistics Canada’s 2019 figures (the most recent available), the average person under age 35 had saved $9,905 towards retirement (RRSPs only) and held $27,425 in non-pension financial assets. For Canadians aged 35 to 44, these numbers are $15,993 and $23,743, respectively.
The table below shows the average savings for individuals and economic families, which Statistics Canada defines as “a group of two or more persons who live in the same dwelling and are related to each other by blood, marriage, common-law union, adoption or a foster relationship.” In 2019, the average household savings rate was 2.08%.
The pandemic had a positive effect on savings; the disposable income of the average Canadian rose by an additional $1,800 in 2020, according to the Bank of Canada. That meant most Canadians were able to save an average of $5,800 that year.
Despite this pandemic silver lining, most Canadians aren’t saving enough for their age groups. When CIBC polled Canadians in 2019 on how much money they’d need in retirement, on average they guessed they would need $756,000. The actual amount you’ll need depends on many factors—to estimate your own number, check out CIBC’s retirement savings calculator.
How to prioritize financial goals and obligations in your 30s
With so much going on in your 30s, it can be very challenging to save when you have so much to pay for. After all, you may be carrying a lot of debt due to student loans, a car loan or a mortgage. In the third quarter of 2023, Canadians aged 26 to 35 owed an average of $17,159, and Canadians aged 36 to 45 owed $26,155, according to a report from Equifax.
Maybe debt is less of a concern for you, but you’re saving for a big goal—like a down payment on a home—and you’re feeling the strain of a high interest rate and inflation. Perhaps you’d like to start a family, but you’re worried about the costs of raising a child. Or you’ve dabbled a bit in the stock market and want to make a few more investments.
Whatever your situation, talking to a financial planner about your finances and your priorities can help you map out a customized financial plan that factors in your immediate goals—as well as long-term savings and retirement strategies. This might include focusing on paying off high-interest debt, putting aside money for a home, shopping around for life insurance and ensuring that you save each month.
FILL OUT COLLEGE APPLICATIONS AND APPLY FOR FINANCIAL AID THAT WAS THE GOAL OF A FREE EVENT TODAY IN NATOMAS, AS THE YOUTH LEADERSHIP ACADEMY OF THE ASIAN PACIFIC ISLANDER, AMERICAN PUBLIC AFFAIRS ASSOCIATION HOSTED A FINANCIAL LITERACY WORKSHOP. TODAY FOR HIGH SCHOOLERS AND THEIR FAMILIES. THERE WERE SPEAKERS AND COUNSELORS AVAILABLE FOR THE MORE THAN 100 ATTENDEES, AND TO ANSWER ANY QUESTIONS THE STUDENTS OR THEIR PARENTS MAY HAVE ABOUT COLLEGE AGE. THAT’S WHAT WE WANT TO EDUCATE THE CHILDREN ABOUT TODAY ON HOW TO SOLIDIFY THEIR COLLEGE APPLICATION AND HOW TO MAKE THEIR APPLICATIONS STAND OUT. WHAT IS THE PROCESS? WHAT IS THE PROCESS OF APPLYING FOR FINANCIAL AID? WHAT IS THE PROCESS FOR APPLYING FOR STUDENT LOANS? WHAT’S THE DIFFERENCE BETWEEN A GRANT AND A LOAN? ALL THOSE DIFFERENT KINDS OF THINGS THAT YOU KNOW, IT DOESN’T COME EASY TO PARENTS OR STUDENTS. THESE SPEAKERS FROM SACRAMENTO STATE AND THE STUDENT AI
Sacramento high school students get tips for college applications
Updated: 10:06 PM PDT Jun 15, 2024
High School students throughout the Sacramento area attended a free and engaging workshop to obtain valuable tips and information about the college application and financial aid process. At the workshop, speakers covered a variety of topics including leadership, college applications, financial planning and stress-reducing mental health tips.For more check out the video player above.
SACRAMENTO, Calif. —
High School students throughout the Sacramento area attended a free and engaging workshop to obtain valuable tips and information about the college application and financial aid process.
At the workshop, speakers covered a variety of topics including leadership, college applications, financial planning and stress-reducing mental health tips.
What was the biggest money lesson you learned as an adult?
The understanding of how big a role your identity plays in your finances. Finance is deeply personal and intersectional, and your money is directly impacted by aspects of your identity such as privilege, race, gender, sexual orientation, mental health, disability, systems of oppression and more. The identities you hold will impact how you view, understand, spend and approach your money.
I didn’t fully understand this until I came out as queer and was diagnosed with ADHD. These realizations helped me make sense of a lot of my money behaviours and challenges. For example, I struggled with impulse spending for years, and ended up with $15,000 of high-interest debt because of that. I felt so ashamed of this debt, but I didn’t know that having ADHD makes me four times more likely to impulse spend than someone without ADHD. By understanding who you are, the privilege you hold and/or barriers you face, your lived experience and your trauma, you can begin to change your relationship with money and create a financial plan that makes sense for your life.
Learning this lesson is what inspired me to write a book and start my financial literacy company, Queerd Co., where our approach to financial literacy goes beyond the conventional, giving folks permission to be full human beings—not just numbers on a spreadsheet. At Queerd Co., our goal is financial equity, and every course we create, resource we recommend, space we hold and discussions we lead will aim to take a shame-free and identity-based approach to money.
What’s the best money advice you’ve ever received?
That your financial situation is not your fault, and the shame you feel around money is not solely your shame to carry. I learned this inside of the Trauma of Money certification program, where we spent time examining and unpacking the idea of shame and responsibility when it comes to our money. The reality is that many of us inherit money trauma and learn our financial behaviours and habits from our caregivers. We also have to consider the government policies, financial institutions, and larger societal systems such as capitalism, and how those play a role in the decisions we make and the financial challenges we are subjected to. In the Trauma of Money, we were taught to ask ourselves, “Whose shame is this?” to help call attention to the fact that some of the shame we feel has been placed upon us, despite it not being our shame to carry. This advice really helped me reframe the way I felt about my past financial decisions.
What’s the worst money advice you’ve ever received?
I tell this story in chapter 1 of my book, which is all about finding safe spaces: The first time I went to talk to a financial advisor at the bank, the advisor made a misogynistic comment along the lines of, “When you have a husband, he will take care of this for you.” This was his response when I tried to ask questions about some financial terms he had briefly mentioned. This was horrible advice because: a) it was misogynistic; and b) it was encouraging me to not be in control of my own financial situation. I cannot stress enough how important it is to have financial autonomy, even within a marriage. If you ever find yourself in an abusive relationship, having access to your own money will give you the freedom to leave.
Would you rather receive a large sum of money all at once or a smaller amount regularly for life?
It would depend on the amount. If the smaller amount was enough to cover my monthly expenses, then I would choose that option, because it would give me the immense privilege of never again stressing about paying my bills. It would also take a lot of pressure off my business and allow me to explore more creative pursuits. But if the amount wasn’t enough to cover my bills, then I’d prefer the lump sum. I could actually make more money from the lump sum in the long term by investing it, but the first example would be a better decision emotionally.
What do you think is the most underrated financial advice?
Gamify your finances. This is great advice for almost everyone, but especially for anyone who is neurodivergent. If you can make managing your money fun and enjoyable, you’ll be more likely to actually keep up with it, and have greater success with reaching your goals.
What is the biggest misconception people have about growing money?
That being “good with money” and building wealth is just a math game, and that all you need to do is manipulate the numbers—it’s so much more than that. Creating the perfect spreadsheet, debt repayment plan or investment strategy will never address the root of your money issues. We’ve been taught that if we follow the formulaic system for success, we will be wealthy and happy. But there’s no magic formula for success, because everyone’s lived experience, values, goals and definitions of wealth are different.
To get started, here’s an overview of what you need to know about moving to Canada, working in Canada and building a good credit history.
The more you know about Canadian money, savings and housing, the better prepared you’ll be. You can even do certain steps—such as opening a bank account—before you arrive. Learn about this and other personal finance topics, including key details about preparing to buy a home in anywhere in Canada.
Finding a job and earning an income soon after arriving in Canada can contribute to your success. We explain who can legally work here, how to apply for a work permit, how to find credible job postings and what details to look for in a job offer. We also tell you about non-profit organizations that help immigrants find work, sign up for free English classes and more
Moving to Canada or new to the country? These six major cities have many job opportunities in different fields—plus we look at the cost of living in each.
From tech to health care, Canada offers plenty of jobs for newcomers—and many of them are included in national and provincial express entry immigration programs.
Once you move to Canada, it’s important to start building a good credit history—it will have a big impact on your future here. If you plan to borrow money to buy a home or a car, for example, lenders will look at your credit report to decide if they’ll loan you money and how much interest to charge you. Employers, landlords and even cellphone companies may check your credit report. We explain how to build your credit history and how to improve your credit score.
Some financial products in Canada are similar to what’s available in India, like fixed deposits and GICs. Check out our list.
We’ve rounded up 15 more MoneySense articles that provide personal finance tips for different life stages—from your first steps in Canada to getting established to planning for retirement.
First, what questions you should ask a financial advisor
When you meet with a prospective financial advisor for the first time, your gut instinct might be to tell the advisor what you’re seeking and ask if they can assist. However, if you’re looking for a truly objective financial advisor, you’ll have to approach the meeting differently, says Chapman.
Before sharing a lot of details about yourself, he recommends asking the advisor these questions, in this order:
“Who is your ideal client?”
“How do you help your ideal clients?”
“What common problems do you help your ideal clients solve?”
“Who do you not work with?”
“How do you get paid?”
If the advisor can clearly answer these questions, the answers don’t raise any red flags, and the advisor takes the time to explain things, then you’re probably a good fit. It also helps if you like the person.
The fifth question is important when working with any financial professional, says Chapman. Whether it’s an accountant, a mortgage broker or a financial advisor, ask them, “Who pays for your services?” Ideally, you want the answer to be “You.” This provides the highest likelihood that there won’t be any outside influence on, or any conflicts of interest in, their advice. For example, if an advisor gets a commission from selling you certain investments or insurance packages, or for recommending a specific mortgage, that could be a conflict of interest.
How to do an advisor background check
Before you hire a financial advisor, you’ll want to do your homework. This involves doing a background check and confirming credentials.
Financial advisors should have at least one professional designation, such as Certified Financial Planner (CFP), Chartered Life Underwriter (CLU) or Registered Financial Planner (RFP), among others. You’ll want to verify with the appropriate issuing body or bodies that the advisor is in good standing. “It means they have paid their membership dues and attested they completed all continuing education requirements,” says Chapman.
Your advisor might also be willing to provide references from existing clients—just keep in mind that these are the ones who are happy with their work.
The Move Brings Greater Access to Families Seeking Another Option to Help Fortify Their Retirement Strategy
KANSAS CITY, Mo., March 12, 2024 (Newswire.com)
– Owens Financial Group has announced that its Fiscal Fortress™ proprietary planning and investment strategy will now be available to clients nationwide. This expansion provides families across the nation with a way to help fortify their retirement planning and investment strategy.
“After a record 2023,” says Owens Financial Group President and Wealth Advisor Chris Owens, “we felt the time was right to expand our services to help families nationwide. Our team continues to grow in response to increased demand for access to the Fiscal Fortress™ strategy.
“When building your Fiscal Fortress™,” continued Owens, “the goal is to build a portfolio using what we call ‘risk differentiation.’ As we get closer to retirement, especially in retirement, making sure our lifestyle isn’t dependent on what the market does and instead relying on variables with insulation from outside forces, is important. While this may seem like common sense, many families’ question is, ‘How?’”
The Fiscal Fortress™ incorporates similar strategies that higher institutions have used for decades to help navigate turbulent financial waters. Owens Financial Group has broken these strategies down into simple, easy-to-understand concepts that can be implemented right away.
The Fiscal Fortress™ is specifically designed for people at, in, or near retirement with at least $750,000 or more of investable assets and can help guide families to a confident and sustainable retirement. For more information, visit www.fiscalfortress.com.
Insurance products are offered through the insurance business Owens Financial Group, LLC. Owens Financial Group, LLC is also an Investment Advisory practice that offers products and services through AE Wealth Management, LLC (AEWM), a Registered Investment Advisor. AEWM does not offer insurance products. The insurance products offered by Owens Financial Group, LLC are not subject to Investment Advisor requirements. Investing involves risk including the potential loss of principal. Any references to [protection benefits, safety, security, lifetime income, etc.] generally refer to fixed insurance products, never securities or investment products. Insurance and annuity product guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company. 2284957 – 03/24
What’s the difference between the types of advisors listed in the tool?
The Find a Qualified Advisor tool allows you to search for advisors by Qualifications, Location, Services, Specializations and Payment Model.
A note about location: Maybe you’ve already tried searching for “financial advisor near me” or something similar. Many advisors now provide services virtually, so you don’t necessarily need to find an advisor in your own town or city.
The advisors listed in our tool provide different services and have different specializations, and they have a variety of financial planning designations. In addition, they charge for or get paid for their services in several ways. Here’s how to understand these criteria:
Services
The advisors in our directory may provide some or all of the following services:
Financial planning: These advisors can evaluate your current and future financial states and provide a comprehensive financial plan with recommendations to optimize your situation while taking into account your goals and values. A financial plan can also focus on a specific goal or circumstance, such as planning for post-secondary education funding, debt repayment, financial planning as part of a separation or divorce, risk management or retirement, to name only a few examples. See below for a list of different financial planning designations.
Investment planning and implementation: These advisors can provide specific investment recommendations and implement them by investing your money for you. To provide investment planning and implementation services, an advisor must be licensed by the investment regulatory body in every province and territory where they provide services, and they must manage money through an investment dealership.
Insurance planning and implementation: These advisors can provide specific insurance recommendations and implement them by selling you insurance products. To provide insurance implementation services, an advisor must be licensed by the insurance regulatory body in every province and territory where they provide services.
Mortgage/lending implementation: These advisors can provide specific mortgage and lending recommendations and implement them for you by arranging mortgages, term loans, consolidation loans and other forms of credit. To provide mortgages, these advisors must be licensed as mortgage brokers or mortgage agents in every province and territory where they provide services.
Specializations
The advisors in our directory may specialize in specific types of advice or services—such as cross-border or international financial planning, socially responsible investing, business succession planning or retirement income planning.
Qualifications
The advisors in our directory are all members of the Financial Planning Association of Canada. In accordance with FPAC membership requirements, they all have at least one of the following financial planning designations:
The Canadian federal government eliminated the accumulation of interest on Canada Student Loans, as of April 1, 2023, but you must still pay any interest accrued before then. Some provinces and territories—Alberta, Saskatchewan, Ontario, Quebec, Nunavut and the Northwest Territories—charge interest on their portion of student loans. The interest rate varies, but it’s typically the prime rate plus a percentage. Ontario, for example, calculates interest at prime rate (currently 7.2%) plus 1%.
2. Build an emergency fund
Once your credit card debt is paid off and you’re on track with repaying your student loans, next on the agenda should be building an emergency fund, which should cover at least three months of living expenses. This will be helpful for situations like getting laid off, a car breakdown, a sudden health condition that doesn’t allow you to work, and so on.
You do have a few options for where to stash your cash, including registered accounts, but in an emergency, you’ll likely want fast and easy access to your money. A high-interest savings account (HISA) pays significantly more interest than a regular savings of chequing bank account, and you can withdraw the funds anytime.
3. Set goals—and set up savings plans to fund them
Once you have a solid debt repayment plan and an emergency fund, you can allocate some funds towards your future financial goals. Maybe you’re adopting a pet, or you’re starting a side hustle and need start-up costs. Maybe you’re aiming to take a big trip or buy a car in the next few years. An automated savings plan—which transfers a set amount to a specific savings account—can help you accomplish this faster. At CIBC, for example, you can set up AutoSave in your bank account to transfer a set amount—say, $100—to a specific savings account each time your paycheque is deposited. (This is what financial experts mean by “paying yourself first”!)
Your monthly contributions may be as small as $20 a week or as high as $100 or more, but the key is that they will add up over time. You want to maximize the interest you earn on it. Remember that compound interest info above? It applies in a positive way, too. You can earn interest on the interest you’ve saved. Check out our compound interest calculator—it may blow your mind to see how savings can grow over 30 years. (Your parents and future financial advisor will be impressed, too.)
Again, a HISA is a good option that pays more interest than a regular bank account. Currently, you can find HISAs with interest rates of 2.5% to 5.75%, which might include limited-time promotional offers* that pay additional interest for a few months to a year. While these rates can change, using a HISA can be a great wealth-building tool in the short term. And if the HISA is held in a TFSA, all the investment income you earn is tax-free.
Boost your savings with a special interest rate when you open your first CIBC eAdvantage Savings Account. Limits apply.
4. Choose your financial advice carefully
Parents and friends all have their own ideas about how best to save—especially if they’ve had success buying real estate or made a lot of money investing in the stock market. While some of their tips might be valid, true, their advice might not apply to your unique financial situation.
Love also means security. Yet, surprisingly, half of Canadians don’t have a will, according to a 2023 Angus Reid poll. Having a one is gifting family a safety net—a well-defined plan can guide loved ones through the financial complexities that often accompany the loss of a family member.
In the event of your passing, a detailed will eliminates the guesswork, ensuring your family is taken care of, and it minimizes potential conflicts over your assets. With solid plans in place, your family isn’t left grappling with uncertainty about how to navigate the intricacies of your estate.
You will need to designate beneficiaries on your registered accounts and specify how your other assets should be distributed. This thoughtful act underscores your commitment to their well-being.
2. Preserving your legacy
Your estate plan is more than just a distribution of assets; it’s a reflection of your life’s work and your values. When you articulate your wishes, you give your family a tangible way to remember and honour you. Whether it’s passing down a cherished family heirloom, endowing a scholarship in your name or donating to a cause close to your heart, your estate plan becomes a testament to the values that define you.
Your estate plan becomes a living tribute, ensuring that the essence of who you are is preserved and celebrated for generations to come.
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3. Easing the burden during difficult times
Death is an inevitable part of life, and when it happens, the grief can be overwhelming. From funeral arrangements to property distribution, a will provides clear directives for your assets and plans, sparing your family from the emotional strain of navigating complex legal matters while mourning your passing. They won’t question if their (or other family members’) actions are what you want—because what you want is written out.
By writing up these details in advance, you are giving your family the precious gift of space to grieve without the added stress of managing the intricacies of an estate. As an estate administrator, I’ve seen first-hand the big difference this can make for families.
A love note for the future
While a will and estate plan may not be wrapped with ribbons and bows, their impact is immeasurable. This Valentine’s Day, I urge you to consider the significance of a will, which is a gesture that secures your families’ best interests. It’s an investment in the future, a declaration of love that speaks volumes about your commitment to the well-being and prosperity of those you hold dear. I’m not saying to replace your planned V-Day gift with a will, but definitely add it to your shopping list.
Debbie Stanley is an estate and trust professional, and CEO of the estate firm ETP Canada. She is a writer, speaker and regularly featured guest on Zoomer Radio.
When you inherit real estate, any accumulated tax, if applicable, is generally paid by the estate of the deceased. This is because when a taxpayer dies, they are deemed to have sold their assets on their date of death, and any tax payable is calculated on their final tax return.
Property inherited from a spouse or common-law partner
One exception is for real estate left to a surviving spouse or common-law partner. If you inherited this building from your spouse or common-law partner, Bill, it may not be the property’s 2003 value that you need to determine.
By default, capital assets pass to a surviving spouse or common-law partner at their original cost, unless the executor of the deceased elects otherwise. In this case, you would declare any change in value between the original cost of the property and its fair market value at the time of sale. If the deceased taxpayer is in a low tax bracket in their year of death or has tax deductions or tax credits to claim, a value that is higher than the original cost may be reported.
A capital asset’s original cost is referred to as the adjusted cost base (ACB), and it’s based on: the original acquisition price (typically the purchase price); acquisition costs (like land transfer tax for real estate); and adjustments over the years (like renovations for real estate or reinvested dividends for a stock).
What to do when the adjusted cost base is unknown
Assuming you did not inherit this property from your spouse or common-law partner, Bill, you would need to know the value of the property at the time you inherited it. It should be the fair market value of the property reported on the tax return of the person you inherited it from in 2003. If the building was their principal residence, it may not have been reported.
Assuming you have no record of that value, you could estimate the value on your own. If that’s not easy to do, you can have a realtor look up sales of comparable buildings in the same area around 2003 to try to determine a value. A designated appraiser may be the professional best equipped to provide a valuation based on historical sales data, if it’s available. A formal valuation by the Canada Revenue Agency is an option, but it is not required for your tax filing.
Don’t forget about renovations and rental income
If you have done any renovations to the property since inheriting it, Bill, those renovations may have increased your ACB. Capital improvements are added to the original acquisition cost (the property’s value when you inherited it, in your case) to determine your tax cost in the year of sale.
If the property was a rental property, you may have claimed capital cost allowance or depreciation to reduce the net rental income in some or all of the years you owned it. Those past tax deductions are recaptured in the year of sale and included in your income.
