Children, Disability & Financial Fundamentals

Transcription

1 Children, Disability & Financial Fundamentals

2 Disclaimer The information provided in this presentation is not financial advice. The information contained herein is for educational purposes only and is provided with the understanding that it may not be relied upon as, nor considered to be, the rendering of tax, legal, accounting, or professional advice. Please consult your own subject matter experts for advice on your specific circumstances before taking any action. The information provided is obtained from sources believed to be reliable. While we attempt to convey current and accurate information, we make no representations or warranties of any kind, express or implied, about the completeness, currency, accuracy, reliability, suitability or availability of the information. Any reliance you place on such information is therefore strictly at your own risk. The opinions expressed are those of the author only. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. Mutual Funds provided by the Fund Companies are offered through Worldsource Financial Management Inc. Other Products and Services are offered through Ron Malis and Independent Financial Concepts Group Ltd. 2

3 Ron Malis, B.A. B.Ed, M.B.A. 70% Parents of Children with Disabilities 20% Independent Adults with Disabilities 3

4 Clients 10% 10% 20% Parents of Children with Disabilities 60% Parents Independent ou can insert Adults graphs from Other Google Relatives Sheets Unrelated 4

5 Sorry. (I am going to talk about money) 5

6 25 The average age of the children with disabilities in my practice 6

7 10% The percentage of families with children under the age of 10 with disabilities in my practice 7

8 Financial Strategies are not your primary focus. Why should they be? 8

9 9 Younger Families Older Families Adjusting Have less money Focused on Today Have more time Daily life stabilized Have more money Focused on Tomorrow Have less time

10 10 Younger Families Current Day Priorities take Priority Underestimating the Importance of Time Lack of Clarity Affordability Concerns

11 Financial strategies can be complex but they don t have to be. 11

12 Young Families - The Basics Mom Dad Daughter 30 years old 30 years old 5 years old with PWS 12

13 Young Families - The Basics 1. Get some life insurance 2. Invest on a monthly basis (even if it s a small amount) For yourselves (RRSP, TFSA) For your child (RDSP) but don t put money in their names 13

14 $250 $200 Life Insurance 20 Year Coverage Monthly premiums $211 $165 Mom Dad $150 $100 $50 $123 $88 $67 $98 $67 $47 $114 $37 $26 $63 $17 $22 $39 $0 $2,000,000 $1,500,000 $1,000,000 $500,000 $250,000 Both 30 yrs 14 Mom Dad Total

15 What you would have at age 65 When you start is more important than how much you invest Automate Investment Contributions Monthly Contribution 30 yr old 35 yr old 40 yr old $250 $357,958 $252,384 $174, Note: Based on 6% annual average rate of return. No guarantees are implied by this illustration.

16 What you would have at age 65 When you start is more important than how much you invest Automate Investment Contributions Monthly Contribution 30 yr old 35 yr old 40 yr old $250 $357,958 $252,384 $174, $357, $357, Note: Based on 6% annual average rate of return. No guarantees are implied by this illustration.

17 17 Registered Disability Savings Plan Created in 2008 Long-Term Savings Plan $90,000 in Government Contributions

18 18 Registered Disability Savings Plan Eligibility: the Disability Tax Credit Grant: Government matches your contributions Bond: Government contributes based on Family Income

19 RDSP Government Contributions "Family Income" Private Family Contributions Grant Bond Less than $30,000 $1,500 $3,500 $1,000 Between $30,000 and $45,916 $1,500 $3,500 pro-rated Between $45,917 and $91,831 $1,500 $3,500 $0.00 More than $91,831 $1,000 $1,000 $

20 $1,500 Your annual Contribution $4,500 Government Annual Contribution $6,000 Total Combined Annual Contribution $30,000 Your contribution over 20 Years $90,000 Government contribution over 20 Years $418,980 $120,000 Total Contribution over 20 Years Note: Based on eligibility for maximum Grant and Bond each year, 6% annual average rate of return and a 10 year waiting period after the final government contribution. 20

21 21 Older Families Approaching or In Retirement Children are (Young) Adults Contending with Multiple Priorities Need for More Sophisticated Planning

22 Continuing Support Retirement Legacy 22

23 Low Income High Net Worth The Middle Can t do it All on their own 23

24 24 Ontario Disability Support Program Provides Income and health benefits Ontario Residents with a Disability Who are in Financial Need Parents income & assets don t impact eligibility

25 $827,000 Amount of ODSP Income Benefits Between 18 and 65 yrs 25

26 26 Ontario Disability Support Program Not allowed more than $5,000 in assets Not allowed to receive more than $6,000 in a 12 month period for non-disability related expenses Supplementing ODSP can Jeopardize Eligibility

27 27 Retirement Topic for another day

28 28 Legacy Planning Wills and Powers of Attorney Henson Trust Selecting Trustees Any lawyer (or financial advisor) will not do

29 29 Henson Trust Absolute Discretionary Trust Assets in the trust exempt by ODSP (no limit) Assets withdrawn from the trust are subject to the $6,000 rule Taxes, ODSP Reporting, Trustee Act

30 30

31 Thanks!