Emotional Resilience for Retirement

When preparing for retirement, most people focus more on the financial side, especially since leaving the workforce may mean having limited resources.

The first question we get asked is usually “How much income will I need to retire?” followed by, “When can I realistically retire?” This last question refers to more specific figures and when those exact numbers should be met.

Our response to our clients is often, “Well, it depends on what you want to do in retirement!” and this answer is usually greeted with somewhat of a blank expression.

Many of us assume that when the retirement chapter of our life comes, we will be joyfully not working, and we’ll figure out what we will be doing when that time comes. But the truth is, stepping into that new life takes some emotional and psychological preparation. 

And it starts with considering how you imagine your new life. What do you want to do in retirement?

We want to ensure you have fun and find purpose in this stage of your life. So, along with your finances, you need to consider what will make you happy and fulfilled while transitioning to retirement. By doing so, you will have a much smoother experience, including making lifestyle decisions, such as downsizing to have more financial freedom and the ability to age at home.

Learn how to prepare yourself for retirement right here.

Till next time,

Betty-Anne Howard / Athena Wealth and Legacy Solutions

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Financial Life Planning Tips from Betty-Anne Howard, Athena Wealth and Legacy Planning: Fight Climate Change Through Socially Responsible Investing

As many scientific studies have shown us, one of the major culprits behind climate change is corporations that aren’t considering the environment in their business practices. One way to fight this is to invest in companies or organizations that are environmentally conscious and create the change that we want to see in the world. 

This practice is known as socially responsible investing, or SRI. SRI is the strategy of investing in companies that care about how their decisions affect the environment and society in general. The goal of socially responsible investing is to tap into financial AND social gain. 

Investing is the best way to make the most out of the money you earn. And by choosing to practice socially responsible investing, not only are you building wealth with your money, but you’re also contributing to preserving the Earth’s resources. 

Remember, we only have one livable planet, so let’s do what we can to save it while we still have the opportunity.  And if you need expert advice about making SRI investments, feel free to book a call with me so we can explore your financial journey together. 

Read this for more information about SRI. (Link blog)

Till next time,

Betty-Anne Howard / Athena Wealth and Legacy Solutions

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Financial Life Planning Tips from Betty-Anne Howard, Athena Wealth and Legacy Planning: “Who else can I appoint as my Executor to help our bright, smart, adult kids settle our estate?”

“Who else can I appoint as my Executor to help our bright, smart, adult kids settle our estate?”

This is a question we are hearing more and more often these days. 

Usually, upon exploration,  the thinking behind this question is; “We know that settling an estate is getting more complex, difficult, and time consuming, and we don’t want to leave this burden to our kids”. 

And, in some cases this question also includes, “Can we name this entity as the Power of Attorney for our Property?”

The next question is usually, if these are our options, how much will this cost?  We’ve heard people say things like; “I don’t like the fact that this company is going to take 15% off the top of my estate, based on the total value of our estate!”  

The good news is that you have options for who you can hire to do this job – to be the Executor of your will and to assign as the power of attorney of your property. 

Let’s start with understanding that any Executor, no matter who it is, has the option to charge your estate 5% of the total value of your estate for performing that job for you (actually it’s your estate they are settling so theoretically it’s not you personally, at that moment). Thus, it stands to reason that as a starting point a cost of 5% based on the value of your estate can be expected to be paid. 

For example, if you have an estate value of $1million, the cost would be $50,000.  Many estate planning lawyers who provide these services will charge 5%. Full disclosure: we’ve set our estate up with our lawyer and asked them to be our Executor and that’s what we expect to pay for those services.

There are a number of banks/trust companies that offer these services as well and will charge you a certain amount/percentage depending on if your investments are being held within their firm and the total value of your estate.

We are in the process of summarizing these details for comparison purposes so our clients can make an informed decision regarding who they’d like to hire to be their Executor. This comparison will include a summary of costs and services provided. 

If you find yourself asking, “What are my options, and how much does it cost to hire an Executor for my will?” – we’re here to help. Don’t hesitate to contact us for more information or to schedule a consultation.

Till next time

Betty-Anne Howard / Athena Wealth and Legacy Solutions

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Good To Know – Financial Life Planning Tips from Betty-Anne Howard, Athena Wealth and Legacy Planning

Should I donate money to charity now or at my death?

 Recently, when sharing information in a presentation at the Legion in Almonte on Tax Reduction and Estate Tax Elimination, I was asked a brilliant question, the answer to which wasn’t simple or easy.

 Connie, who posed the question, made it clear she wasn’t happy or satisfied with my answer, which was great feedback! She asked; “If I have $10,000 to give to charity, am I better off giving it to charity now, or when I am gone?”

 My response was…it depends on what you’re wanting to achieve! I told her it was difficult to answer a question like that without knowing her tax situation. Connie and her husband Don booked a follow-up meeting with Tara and me, and we then had the opportunity to learn more about their situation and answer the question more fully. Connie was particularly helpful in steering us towards great ways to answer that question that wouldn’t necessarily depend on knowing exactly what the tax situation is.

 So, thanks to Connie, here are some answers to the question, “Should I donate money to charity now or at my death”?

 #1. First, it’s important to understand that there are many different factors that need to be considered when deciding to give now or at your death, and each situation is unique. 

 #2. Second, even though it is not a simple answer, there are several things you can consider that may help you in making the decision. Here are some questions to ask yourself:

• Do I want to see the benefits of my donation while I am alive?
• How much can I safely donate now? This requires a determination of how much income you need to maintain your current lifestyle either with your partner or alone.
• What are my survivor benefits and entitlements, and what will be the tax liability of the final spouse? When calculating this, you will need to determine which assets trigger taxes, and also if there are mechanisms/strategies to redirect those dollars to charity instead of after-death taxes. 

 It’s these last two questions that ensure a win-win for charities and families. You start to see the benefits of answering these questions after the calculations are done. It also helps to clarify how one can win (i.e. the charity) and the other (family) not lose.

 I hope this has helped clarify some of the considerations around donating to charity, and if you would like to sit down with us just like Connie and Don, to discuss your own situation, please do get in touch!

 Till next time

Betty-Anne Howard / Athena Wealth and Legacy Solutions

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Good To Know – Financial Life Planning Tips from Betty-Anne Howard, Athena Wealth and Legacy Planning

Today let’s talk about beneficiary designations on registered money – your RRSP’s/RRIF’s and Locked In RRSP’s/LIF’s. 

Beneficiary designations are an easy way to redirect money to your favorite charities, achieve your legacy goals, and not make the Canada Revenue Agency (CRA) the unintended beneficiary of a portion of your estate!

How you do this depends on your situation.

If you want your spouse to be the beneficiary of your registered money, it’s important to ensure their future is secured by leaving your registered money to them, so it passes over tax-free to your survivor, and this includes common law spouses as well.

If you don’t have a surviving spouse then you can consider naming your favorite charities the beneficiaries of this account, or even a portion of it as, generally speaking, whatever amount you redirect to charity is the amount that will receive a charitable tax credit which will significantly reduce your income tax bill, at your death.  

If you do have a spouse, then it’s good to consider naming the charity the contingent beneficiary of your registered money. This way, if something happens to you and your spouse, then the money can go directly to charity. 

Or, if your spouse predeceases you and you forget to change the beneficiary designations, (and this too can happen, we’ve seen it!), then you already have the redirecting of these assets to achieve your legacy goals rather than having your Executor hand a significant amount of this money over to the CRA.

Give your beneficiary designations a great deal of thought and make sure you set plans in place for this very important estate planning strategy. 

Till next time

Betty-Anne Howard / Athena Wealth and Legacy Solutions

Get tips and strategies for your holistic financial life planning from the team of experts at Athena Wealth and Legacy Solutions straight to your inbox – sign up here.