perspectives

Happy Thanksgiving
by Shelly Appleton-Benko | October 8, 2021



ABCs

ABCs to PhDs – Consider an RESP!
by Shelly Appleton-Benko | September 8, 2021

September signals back to school, and whether that’s for preschool, high school or completing a post-secondary education, we are reminded of Benjamin Franklins’ quote: “An investment in knowledge pays the best interest.”

As true as that is, post-secondary education is expensive, and costs continue to rise. Early planning can help reduce the stress of managing these costs. One great way to invest for a child’s post-secondary education is through a Registered Education Savings Plan (RESP), coupled with the Canada Education Savings Grant (CESG).

Income and growth within an RESP remain tax-sheltered until withdrawn. In addition, when you start early, the RESP will benefit from a longer time horizon, the power of compound interest and the CESG – up to a lifetime maximum of $7,200!*

Do you think an RESP may be beneficial to your child or grandchild? Is it time for you to learn more?  Please feel free to contact us, and we can go through the details together.

Shelly

P.S. In gratitude of our clients during this back-to-school season, I have made a donation to the Surrey Schools Lunch Program. My hope is that this program will have a positive impact on our community, helping children access better nutrition in support of better educational outcomes.


*CESG amounts depend on the amounts contributed to the RESP.

Thinking Beyond the Finfluencer
by Shelly Appleton-Benko | August 31, 2021

finfluencerHave you heard the term finfluencer? A finfluencer is someone, in fact just about anyone, who uses social media as a platform to share their advice on finance topics – from budgeting and savings to investments and debt management. Popularized on platforms such as TikTok, Instagram and YouTube, finfluencers tend to market toward the younger generations looking to start building their own finances and accumulating wealth for the future. While it is encouraging to see this generation gaining an interest in these topics, the finfluencer space is a bit like the Wild West – you may never know the quality of the advice, as finfluencers are unregulated and often inexperienced, yet command the attention of millions of followers. While there has undoubtedly been some success and great content, it is important to be wary of the information and seek professional advice.

Millennials are known to be curious, independent and technologically advanced – but still need guidance in the finance department. Where the younger members of this generation may have started their investment journey using advice from the internet, social media and friends on various online trading platforms, it may be time to go beyond the finfluencer and get the experience and wisdom of an advisor to take their investments to the next level. From slow wage growth to increasingly high housing prices, the challenges for the younger generation are real, but they are not insurmountable, and I am here to help them with their own wealth accumulation.

Think of our team as a personal and credible finfluencer. Someone you can talk to who can understand the language, needs and aspirations of the next generation and provide the missing link of investing for the long term. As these young people progress in their careers, we want to offer our support in meeting their financial goals. We are here to walk them through the steps and offer tools that will assist in building assets, investing conservatively and saving on taxation and insurance costs that may not have been considered before.

We have a variety of experience and wisdom, and we are looking forward to increasing the work we do with the next generation. If you or someone you know is interested in taking their investments to the next level, please feel free to contact us.


Old Age Security Changes
by Shelly Appleton-Benko | July 23, 2021

Canadians who receive Old Age Security (OAS; available once age 65 or older) are getting a little more money starting this month.

coupleQuick highlights:

  • OAS is increasing 1.3% starting July 2021. [1] The new maximum benefit (if benefits had started at age 65) is $626.49, but could be higher if benefits were deferred (or lower if eligible for only partial benefits).
  • An additional one-time payment of $500 will be made to older OAS recipients (those born on or before June 30, 1947) in the week of August 16, 2021.
  • A permanent 10% increase will be paid to OAS recipients aged 75 or older, starting in July 2022.

Tips:

  • Those who are 75 or older and already have their OAS fully clawed-back may be surprised to get the $500 payment next month!
  • It is unclear at this point whether the one-time payment will be exempt from clawback.[2]
  • Those who pay tax by installments may wish to proactively review and potentially increase withholding taxes, if a clawback of this amount would tip them into installment territory.   

Here is a link to a recent News Release: Canada.ca 

[1] Monthly OAS payments are reviewed in January, April, July and October for cost of living increases, as measured by the Consumer Price Index (CPI).

[2] OAS recipients must repay 15% of the amount by which their income on line 23400 exceeds $79,845, up to the amount of their 2021 OAS benefits, when calculating their 2021 taxes payable. Prior to the changes above, income above $129,075 in 2021 would result in full repayment (assuming a full OAS benefit started at age 65).


The Practice of Patience
by Shelly Appleton-Benko | July 13, 2021

goodthingsThe U.S. economy is re-opening, the COVID-19 battle is being won, and the stock market has been experiencing a historic market rally that is leaving many investors wondering what steps to take next. What will inflation be like in the coming year? What are the possible changes to income tax structures — both here and south of the border — and how will that affect us? And of course, how will we end up paying for the stimulus packages of the past year?

For the past six months, we have seen strength in value and cyclical stocks, and lately the market seems to be moving through those record highs. This is not the time to sit on the sidelines. While investors may want to take some profit where needed, their patience will be rewarded if they hold on for the bumpy ride during the return to normal. Remember that in some cases the pinch of paying capital gains tax will be overcome by the gains taken in the market.

The next few months will definitely be interesting as we watch the economy restart and employees return to workplaces with a newfound confidence—confidence that we all gained from honing our multi-tasking skills as we juggled work, online school and even ordering groceries from home instead of running errands. Visiting the doctor’s office via Zoom and hosting family drive-by birthday parties became new norms as we adapted to keep each other safe. We learned to connect in different ways that we never have before and realized what is really important in our lives. This has truly been a challenging year and three months, and much has been lost during this time. However, it is time to look to the leading indicators in our economies and focus on the drivers behind the market confidence.

Extremely low interest rates have generated a lot of investment interest in real estate and the stock market. We have continued to add value to client portfolios by diversifying the investments into cyclicals, staples and infrastructure plays that will grow as our economies build up once again. Fixed income rates are quite low, and inflationary pressure is a concern. However, it is also important to remember that staying invested can be the best opponent to inflation. Avoiding timing the market is a strategy that we continue to feel strongly about. Practicing patience, trimming profits when we can and remaining diversified in companies is how we will fight any turbulent times ahead for our clients. We have invested in the best quality firms with outstanding management. These teams are working hard to pivot, reorganize and continue to deliver profitability to shareholders, during these difficult and confusing times. This is an exercise in patience, but ultimately investors will be rewarded if they stick to their overall strategy and allow the market to make those hard decisions for them.


Happy Father's Day!
by Shelly Appleton-Benko | June 18, 2021

Father's Day


25th Anniversary25 Years in the Making!
by Shelly Appleton-Benko | June 3, 2021

Wow! Twenty-five years went by in what seems like the blink of an eye. It’s hard to believe that on June 3, 1996, I began my career at Odlum Brown. So much has happened – and there’s so much more still to come!

Milestones like this one are a pit stop in life’s journey, and a great chance to pause, reflect and celebrate some of the lessons learned along the way:

1.  I am still excited by the energy of the markets and, more so, working with clients to make the most of their wealth. Integrating planning with our tailored investment approach, we have witnessed our clients achieve their goals, be it buying their first home or their first commercial building; retiring in the comfort and lifestyle they want; or leaving a legacy for future generations. So many dreams fulfilled, so many bucket list items checked off – it’s inspiring to work with clients as they reach their goals. I really love what I do!

2.  Believe it or not, I am thankful for the experiences of navigating events like Y2K, the dot-com bubble, the 2008/09 financial crisis and, yes, even the current pandemic. These situations have taught me patience and resilience, as well as the importance of a long-term approach and owning quality investments. Employing strategies to mitigate risk while still leveraging upside potential has been rewarding. Some may say wisdom, some may say experience, but whatever you call it, these dips and valleys have provided perspective on the markets. I hope to be able to help clients benefit from this “it factor” for many years to come!

3.  I value working at an independent, employee-owned firm. Our team has the opportunity to build client portfolios with objective, impartial advice, free from conflicts of interest, with an unwavering commitment to doing what’s in the best interest of our clients, first and always. I am grateful, too, to my mentors and colleagues who have provided guidance and advice along the way. The Research Department’s exemplary track record, the expertise and knowledge base of the Odlum Brown Financial Services Limited team,* the in-house Client Services support over the years – all have been invaluable to our clients’ success!

4.  I am surrounded by amazing and intelligent teammates who have created a productive and engaging environment to work in each and every day. STM Wealth Management has guided and connected with an incredible number of individuals and organizations over the years. We are extremely fortunate to be able to rely on each other as we maneuver through the markets, financial strategies and building new relationships along the way!

5.  Most of all, I am grateful to our clients and building relationships with all of you over the years. Some of you have been here since the beginning and some we are just welcoming aboard. No matter the length so far, it has been a privilege to walk alongside you and be part of your investment journey.

Cheers to celebrating the most amazing 25 years of my investment career. Thank you for joining me on this amazing journey, and may we have many more exciting achievements come our way!

Stay well, everyone!

*Odlum Brown Financial Services Limited (OBFSL) is a wholly owned subsidiary of Odlum Brown Limited offering life insurance products, retirement, estate and financial planning exclusively to Odlum Brown clients.


Taxes – Almost Done
by Shelly Appleton-Benko | May 18, 2021

Futurequote

For many, our personal income taxes for the 2020 tax year have been submitted to Canada Revenue Agency. (Self-employed persons need to file their personal income tax return by June 15, 2021, but any balance owing by April 30). So now what?

Refund or Payment?
If you received a refund, while a splurge might be tempting, this isn’t a lottery win. This is your hard-earned money that essentially the government was holding for you and is now giving back. Make the most of it. Pay off debt on your credit card or your mortgage; contribute to your RRSP and get the future tax benefit; maximize your TSFA; set it aside for your child’s RESP or RDSP. Keep your money working effectively.

Had to pay? Are there any tweaks that you can make today, so you do not have to foot the bill again next year? If you are employed and have RRSP room available, will increasing your contributions help next year? Consider initiating or increasing a pre-authorized amount so it automatically deposits to your RRSP.

Received your Notice of Assessment?
Your Notice of Assessment contains useful information, including your RRSP deduction limit, Home Buyers’ Plan or Lifelong Learning Plan repayments, capital loss carryforwards and/or taxes owing. Be sure to review the information and have it available for future reference, and contact us if you’d like us keep these details on file for you; we can send you a secure link to send them in.

Missed the deadline? Need to make a correction? Being audited?
We have a great network of accountants. Let us know if you would like a recommendation and we can provide a few names so that you may find the best fit.

Please feel free to contact us with any other questions!


Creating a Legacy with Larry
by Shelly Appleton-Benko | May 14, 2021

LarryMeet Larry. Larry is the name given to my Mother’s Day gift by my children, a beautiful Bonsai tree. While we are not sure how old Larry is, if properly cared for, Larry could live to be over 100 years old; the oldest known Bonsai tree is over 1,000 years old!

Cultivating bonsai trees are the result of patience and consistent care, just like the legacy that we are creating with our clients and their investments. Intergenerational wealth and knowledge of investing, in general, takes time to learn and patience to pass along. Our investment acumen changes with the economic times and demands; however, the single thread that joins us all together is quality. The quality of the investment portfolio and the advice that comes from our experience is priceless to the next generation.

Larry, my Bonsai tree, will be a physical reminder for me about caring and preparing for the future. The knowledge that with care, attention and the right advice, it can last for generations!

Shelly

P.S. If you have any Bonsai care tips, please send them over!


Happy Mother's Day
by Shelly Appleton-Benko | May 7, 2021

Mother's Day

Be the Change
by Shelly Appleton-Benko | April 29, 2021

change-challengeThree emails hit my inbox this morning regarding corporate earnings of companies that we invest in. All three highlighted that consumption patterns, digital adoption and infrastructure changes are not only persisting through the recovery stage of the pandemic, but accelerating. Now that many of us have worked remotely at home for a year, we are asking ourselves how our lives will change going forward. Honestly, these thoughts have crossed our minds more than a few times.

Now is a time for corporations to pivot and change direction for future growth. Significant world events have changed the way that we view progress and adaptability on a large scale. Our systems have been tested, and the way that we do things has significantly changed as a result.

These are not small changes – 1.7 billion people do not bank within the traditional banking system anymore. In my little community, the local branch just closed, and the real estate will be used for alternative use. What will happen to our commercial real estate assets? It is clear that no party sees the end game; however, it does feel different this time. The reasons to visit my local credit union – to send a wire, deposit some change, withdraw some cash, sign a loan document….wait, I don’t have to do any of those things anymore! Could the storefront even be required in the future?

At Odlum Brown, our business is built on relationships. These connections have developed over time, and the trust and knowledge gained through meeting with our clients is immeasurable. During the last year, our team has continued to prioritize keeping in contact with clients, and we have accomplished that with Zoom, telephone calls, emails, blog posts and market updates. We are excited to return back to our offices when the pandemic has eased. At the same time, aspects of the business might look a little different, as we continue to adapt and integrate the things we’ve learned over the past year to provide the best possible experience to our clients.

We are grateful to all of you who have adopted electronic delivery of statements, and secure transmission of documents at tax time. These are new methods for us all to learn, and they can feel complicated to master! But let’s not give up on technology, as it will be the future, and we all want to be part of the change as we move into the new normal.


Put the Benny on... the Long Term
by Shelly Appleton-Benko | April 13, 2021

benjaminIn the finance industry, we never talk about gambling: it is just not done, for a lot of reasons. But there is no doubt that the past year saw an increase in speculation in the stock market.

We can all agree that the last year was turbulent: the S&P 500 Index fell 34% in just three weeks of trading in March 2020, and there were a lot of people who felt that the world was closing in on them from the effects of the global pandemic. Imagine our delight when we reported the amazing stock market results of 2020 to our clients last quarter!

However, the stimulus cheques have been spent, and the speculations made on some high-flying technology and growth stocks have started to taper off. The easy money has been made, as they say.

Recently, we have seen the financial and energy sectors return to popularity, and the profits move from technology and growth stocks to other sectors that were ignored in the last year. This movement is not a total surprise, as the anticipation that interest rates may move upward again in the next few quarters will ultimately dampen the mania of the technology and growth sectors.

What to do now? Continue to think about the long-term investment game. The theory of economics is still applicable: it is all about supply and demand, and although stock returns have indicated otherwise in the past year, the long-term investor is paying attention to things like interest rates, inflation and recent spikes in energy prices. The short-term speculators have made their coin — or Bitcoin — and it is time to look at the long runway ahead and how we will maneuver our investments to not only survive, but thrive in this complex new world of Zoom, remote workplaces and cryptocurrency.

Our team has always taken a diversified approach and believes that going forward this will be the path to returning the most value for your investments.

Too much of a good thing is still too much. Balance is the solution to many of our post-pandemic troubles, and the stock market is no different. Put your Benny back in your wallet, or crypto-file, and resist the temptation to play the market. Investing is not a game.


Happy Family Day
by Shelly Appleton-Benko | February 15, 2021

Family Day Collage


Lunar New Year
by Shelly Appleton-Benko | February 11, 2021

Lucky Red PocketThe Year of the Rat is coming to a close, and not a day too soon for most of us. We are extremely thankful that time is marching on, and we are looking forward to the year ahead with a fresh perspective and renewed promise. This year’s Lunar New Year celebrations begin on February 12, 2021, with the second animal in the Chinese calendar, the Ox.

According to astrologists, the Ox represents the hard work, positivity and honesty that will be manifested in all of us over the next 12 months. The Ox is associated with yin, which is slow, soft and passive, and found in the earth, representing stability and nourishment. All of these characteristics are most welcome in 2021 in my opinion! 

Let’s kick off the celebrations with a little money history. For centuries, the tradition of giving out little red envelopes – sometimes referred to as “lucky money” – has centered on passing along good fortune and luck to the recipient for the upcoming year. The ceremony typically involves a visit and exchange of gratitude, best wishes and, of course, the red envelope filled with lucky money.

After all of the challenges of 2020, I believe that everyone could use a little good fortune for the year ahead! Let’s remember that rebounding from this pandemic will require hard work and positivity in addition to kindness. 

I have also been reflecting on how fortunate I am to work with such amazing clients and our team at Odlum Brown, whose values, integrity and knowledge have empowered me to remain positive each and every day over the past year, which I know will lead to a brighter year ahead. 

My “little red envelope” filled with hope and gratitude for all of you includes a wish for a healthy and prosperous year ahead, and hopefully, many opportunities for us to celebrate and be together again soon.


Biden: Chapter One
by Shelly Appleton-Benko | January 27, 2021

2021: Chapter OneLast Wednesday, January 20, 2021 was a historic day for America. Whether you support the Republican or the Democratic party, the political arena has changed and left all of us wondering how Joe Biden, U.S. president number 46, will change the public’s outlook for the economy, and ultimately our personal finances as a result.

I recently finished reading Barack Obama’s book, A Promised Land and was interested to learn about Biden’s role as Vice President and how he responded to many of the events during his eight-year tenure. I expect that Biden’s policies and procedures will be very similar to those of Obama, but perhaps with a more experienced and patient approach.

In his first week in office, President Biden has already proposed a US$1.9 trillion relief package which, if approved by Congress, will assist in job growth and infrastructure spending at both state and federal levels of government. Many of these policies depend on how quickly the COVID-19 recovery and vaccination plans are rolled out. Getting people back to work and feeling comfortable with travelling and spending within the economic environment will play a large role in the stock market’s return in the coming year. There are many risks, including interest rate increases and inflation that could dampen market returns, but Biden’s slow and methodical moves may prevent any unnecessary negative market swings.

Should his choice of beverage at the 2009 Obama “Beer Summit”1 be any indication of the style of governing ahead (Obama chose a light beer and Biden selected non-alcoholic), we don’t expect too much of a departure from the Obama administration in the coming presidential term. Much like his choice of beverage, I suspect Biden to simply offer a lighter and more reserved taste with his administration.


1 https://www.cbc.ca/news/world/obama-beer-summit-hailed-as-friendly-1.835290


2020 Year in Review
by Shelly Appleton-Benko | January 5, 2021

As we move forward into 2021, we take a quick look back at some facts and figures for 2020. 

Click the graphic to see the 2020 Year in Review:

2020 Year in Review