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We Remember
By
Shelly Appleton-Benko | November 10, 2022
When I reflect on Remembrance Day, I am reminded of wars that happened long ago and the many brave people who gave their lives to help Canada be what it is today. I am also thankful for the men and women who are currently serving our country today to ensure our freedom and safety. Grateful for all.
On a similar note, I was recently speaking with a veteran who reminded me that upon “retirement," many continue to serve their community in other roles, including police. I would also like to thank and acknowledge all who continue to risk their lives everyday keeping our communities safe.
On Friday, let’s remember friends, family and community members who gave and continue to create a safe and wonderful home for all us. Lest we forget.
My nephew, pictured above.
Top Wealth Advisor
by
STM Wealth Management | October 28, 2022
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Remembering the Queen
by Shelly Appleton-Benko | September 23, 2022
Whether you are a royalist or not, Her Majesty Queen Elizabeth II has been part of Canadian culture and history for nearly a century. She was a world leader, matriarch and humanitarian, but at the end of the day, the Royals are simply people too. They have their own financial considerations and succession concerns, coupled with lots of family dynamics – of course, on a much grander scale and under the scrutiny of the public microscope!
What financial planning lessons might we take away from their family and consider applying to our own? There are several, and here are a couple that come to mind:
At 96, the Queen has taught us all about longevity and maintaining your health. This distinguished woman saw 15 different Prime Ministers in the U.K., some good, some bad and some unforgettable for various reasons, as well as lived through many wars and global upheavals. Through it all, she never changed her course or acumen, but remained a gracious and stable leader. The stories that the walls of Buckingham Palace must hold! While no crystal ball will tell us how long we have, it is important that we think long term and create a solid financial plan that ensures we don’t outlast our assets. The best way to do this is to have a plan in place, and stick to it!
The Queen was an impeccable planner. I recently read that her coffin was selected, designed and fabricated over 30 years ago. And while her succession plan was mostly laid out based on past traditions, she continued to review and ensure it met the needs going forward, and adjusted the plans to ensure as smooth a transition as possible. Similarly, for clients with businesses, succession plans are critical. Look no further than the strain of the Prince Harry and Meghan Markle situation, and you will see how difficult some conversations may end up being.
While most of us won’t come close to the Royal family’s wealth and land titles, we will likely have heirs or charities to whom we will pass our assets. As the media has recently coined it, “The Great Wealth Transfer” is under way, as baby boomers (those born 1946-1964) or even the silent generation (born in 1925-1945) pass their money on to younger generations. Regardless of how grand the transfer of wealth is or isn’t, it is important to have a will that outlines your wishes. You don’t want others deciding how your estate should be distributed, so ensure you have your plans in place!
Now, with a solid plan in place, it’s time for a cup of tea in honour of her Majesty’s legacy.
1, 2, 3, RESP
by Shelly Appleton-Benko | September 12, 2022
Since we are all students of life, and because it’s back to school time, we thought we would provide three quick lessons on making the most of a Registered Education Savings Plan (RESP).
As an interesting aside that some of you may already know, early in my university life I was thinking of becoming a teacher – so here I get to share some knowledge!
Lesson 1: RESP Basics – What is it? Why use it?
RESPs can help you save for your child’s post-secondary education expenses. Similar to TFSAs and RRSPs, investment growth and income compound tax free until the student starts to take the funds out for tuition or other education-related expenses. Plus, with a $2,500 annual RESP contribution, your child may be eligible for a 20% grant from the federal government through the Canada Education Savings Grant (CESG).
Just $2,500 a year, for 17 years, invested at 4% compound growth, with the maximum CESG, can provide a healthy RESP of $75,000 for your child when they graduate from high school. Remember, these funds can be used for more than tuition and books!
Lesson 2: Extra Incentive – Don’t miss the three-year window for $1,200 grant
In addition to the maximum $7,500 CESG, British Columbia families have access to a $1,200 BC Training and Education Savings Grant when they open a Registered Education Savings Plan (RESP). Be sure to apply when your child turns six, but no later than the day before their ninth birthday to be eligible. Contact us for full details and requirements.
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BIRTH YEAR
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APPLY BEFORE
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2013
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9th birthday in 2022
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2014
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9th birthday in 2023
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2015
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9th birthday in 2023
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2016
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Start applying on 6th birthday in 2022
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Lesson 3: Off to Post-Secondary – Using the funds efficiently
Is it time to spend your RESP as your student heads off to post-secondary? There are some great strategies to consider when withdrawing from your RESP funds. For example, it may be worth considering withdrawing grant and income portions first because they are taxable, and also taxable in the student’s hands (not yours). BC residents get a tax credit on a Basic Personal Amount (BPA) of $11,302 (2022) and Federal BPA of $14,398. As a result, a student can have taxable income from all sources of up to $11,302 before paying any tax (using 2022 BC rates). More info can be found in this previous blog article, Efficiently Drawing Down RESPs from December 2021.
There are many more lessons and details around RESPs to be shared, so please know that we are here to answer your questions and help you determine the best strategy for using an RESP!
BC Cancer Board of Directors
by Shelly Appleton-Benko | August 18, 2022
I am so honoured to announce that I will be joining the BC Cancer Foundation’s Board of Directors in September 2022. This is such an important time for the Foundation, and I am so proud to be a part of it. Making a difference in the lives of others has always been important to me, and the BC Cancer Foundation is a cause that is so close to my heart.
From oncologists and radiologists, to counselors and research staff, I have seen first-hand the impact that the BC Cancer team has made on both their patients’ physical and mental health. In such a devastating time for many families, BC Cancer is there to coordinate care and offer an immense level of support.
I am passionate about overall health and wellbeing – whether it be physical, mental or financial health. By joining the Board, I hope to be a catalyst and meaningfully contribute to the BC Cancer Foundation and its mission to enhance care and research for British Columbians affected by cancer.
Meet Our Team’s Newest Talent
by
Shelly Appleton-Benko | July 28, 2022
Buffet Hangover
by Shelly Appleton-Benko | July 14, 2022
A few weeks ago, Murray Leith, our Executive Vice President, Director, Investment Research, published a market comment titled, “The Sugar Crash Will Pass.” This comment describes how investors have been whipsawed by their emotions, and how fear of inflation and higher interest rates have fueled an economic sugar crash. We mirror Mr. Leith’s comments and would like to emphasize that as long-term investors, the story is often repetitive and challenging to read. Ripping off the bandage and coming to terms with a market correction is necessary if we want our portfolios to survive and thrive.
The stock market is a leading indicator and it is sending a message loud and clear: the coming months will be volatile, and with the prospect of higher interest rates, there may be opportunities to add a few other asset classes back to the portfolios. This is a firm reminder that curbing spending levels, as well as encouraging consumers to consider the implications of higher interest rates on consumer debt and mortgages, will be beneficial to overall net worth.
Regardless of whether a recession is imminent or not, we promote long-term investing, based on solid research in companies with excellent track records and management teams that can provide value during these trying times.
This quarterly update is titled “Buffet Hangover” because we believe that after several years of excellent returns, these past few months have been challenging. After a night of overindulging, feelings of anxiety, guilt and low energy might kick in. Feeling unwell is often followed by a recalibration of sorts, and a renewed outlook as things return to normal. Similarly, the market has been through major corrections before, and we were uncertain of what the future held; however, we always returned to balance eventually. As we age, we learn that the rebalancing process takes time, and any negative energy spent on speeding up the process is futile because we can’t control the economic factors at play. We believe that this is an exercise in patience while the U.S. Federal Reserve tries to mend the fences and return to the normal balance of economic activity.
During this “hangover” time, there are still opportunities we look to take advantage of, while continuing to mitigate risk. The market is telling us it’s time to put away the elastic-waist pants, get through some high-intensity market workouts, and, with some time and patience, the markets will get back to a leaner and stronger state. Remember that the long-term economic history of the stock market has proven that being patient always wins, and many times the best investing opportunities present themselves after trying times.
What is Whipsaw?
by Shelly Appleton-Benko | May 12, 2022
Why is it that everything that is good for you, is often also painful? Exercising, eating healthy, paying taxes and, of course, riding out market corrections. Yes, you heard me correctly: market corrections are healthy and can be good for you over the long term. Equity markets are designed to balance between risk and reward. In 2020 and 2021, the scales were tipped in one direction only: up. At that time, reviewing our monthly statements was satisfying and not painful at all.
However, too much of a good thing is not a good thing. It is important to note that companies don’t grow their earnings by 20% in one year under normal conditions. So, why have we come to expect these type of returns? Houses should not increase in value by that margin either, yet many homeowners are anxiously opening their property assessments in anticipation of their net worth going up, without having done anything to contribute towards it.
Let’s return to the question in the title of this note, “What is whipsaw?” A trader is considered to be “whipsawed” when the price of a security they have just invested in abruptly moves in the opposite, and unexpected, direction. Whipsaw patterns most notably occur in a volatile market in which price fluctuations are unpredictable – similar to the circumstances we find ourselves in now.
The current market volatility is unnerving, and leaves us with many unanswered questions. The exact answers are unknown, and that is why the ups and downs of this market may seem particularly painful. However, we need to adjust our expectations and understand that 2022 has become the year of change. We all listened to the experts who told us that markets were frothy and inflation was coming. Today, we are faced with a changing investment environment that creates opportunity. The timing of these opportunities is currently unknown, but it’s important to remember that they always come around. History has shown us that patience is not only a virtue, but also a key attribute that successful investors embrace. The scales take time to rebalance, and now is the time to exercise patience.
Inflation and Interest Rates Are Leading the Race
by Shelly Appleton-Benko | May 3, 2022
Dark and stormy is great if you are a cocktail, but not so great if you are the stock market.
The recent headlines regarding more COVID-19 lockdowns in China, as well as inflationary pressures caused by higher energy prices and the war in Ukraine, have caused a few storm clouds and a fair amount of uncertainty in the markets. We would like to think that the U.S. Federal Reserve (Fed) will make appropriate moves to control the inflated prices in a timely manner in order to curb price increases, but we have to ask ourselves, “Is this the end of the lower-rate era?”
Although rates are scheduled to rise, we do feel that the Fed and the Bank of Canada will control the pressure of the increases, which in turn will assist in the inflationary pressure of prices. If the prices continue to rise, the rates will also continue to rise to prevent inflation from running out of control.
The supply chain shortage is an additional factor that could extend the pain of the current situation for the foreseeable future. We are also in the middle of earnings season, which will perhaps forecast what the summer months will bring to the markets. Regardless of the pace of these rate changes, many companies are preparing for price increases, and making changes to improve their overall profitability during these uncertain times. This means that investors have to adjust their expectations for market returns, and even more so for returns on fixed income products. We are coming off a couple of fantastic performance years, but this is a powerful reminder that we are entering a slow-growth environment. Remember, the stock market is forward-looking, and the near future looks a little dark and stormy.
However, we know that historically during uncertain times in the markets, investors have found opportunities, regardless of the turmoil. Is it time to sit back and wait out the storm, or make adjustments? The answer is different for everyone.
If you have questions or would like to discuss your investments, please reach out anytime; we are here to help.
Further reading: Why the Federal Reserve has made a historical mistake on inflation
Inspiring Women
by Shelly Appleton-Benko | March 8, 2022
Almost every day, I am reminded of how lucky I am to work with the women of STM Wealth Management. When asked about the women whom I would like to extend my gratitude to in honour of International Women’s Day, my thoughts led directly back to them. These ladies are my sisters, my partners and my squad. We’ve stuck together through a pandemic, economic breakdowns, inventory shortages and family crises. We have laughed, cried and shared success along the way.
Not only are they innovative and proactive, they literally are there with a casserole on your porch when you need it the most. In moments of struggle, I just close my eyes and their words of encouragement are the loudest in my head, always. May they continue to inspire the new generation, their families, daughters and other women in our world - with the same grace, intelligence and kindness, they bring each and every day as my colleagues at Odlum Brown.
Happy Family Day!
by Shelly Appleton-Benko | February 18, 2022
2/2/22
by Shelly Appleton-Benko | February 2, 2022
Today is February 2, 2022 – or 2/2/22.
I took note of this, as my favourite number is 22. Those of you who know me a little more personally know that it represents many special things in my life: birthdays, my anniversary and my favourite jersey number, to name a few! Furthermore, the number 22 in numerology represents a “master builder.” So I believe that 2022 will be a pinnacle year for the world as we try and maneuver through the seemingly never-ending pandemic. That said, there are plenty of economic challenges at present, and corporations are muddling through the constant restrictions, talent shortages, supply chain issues and, yes, even the inflationary pressure that is on the horizon.
A wise person once told me to concentrate on the things that I can control, and to dedicate my knowledge and skills to ensuring the outcomes of those items are the best that they can be. Since we have no control over the outcomes of the aforementioned challenges, in 2022, I will continue to focus on what I can change to achieve the best outcome for our clients: building portfolios that are resilient, strong and even more diversified than ever before. Volatility will always be a factor in the market, and it is important to address what level of risk we can all manage. However with a solidly built mix, portfolios are more likely to stand the test of time – through 2022 and beyond.
Happy Lunar New Year!
by Shelly Appleton-Benko | February 1, 2022
What does financial planning mean to you?
by Shelly Appleton-Benko | January 18, 2022
Whether it’s because many folks are making resolutions at this time of the year, or simply the desire to get life back to some kind of normalcy, looking to the future and making plans can often be a mindful and healthy step in the right direction.
Consider creating a formal financial plan.* It’s more than just a summary of your investments; it’s a snapshot of where your finances are currently, where you are heading and factors that may affect your journey along the way. It provides a look at both the accumulation and dispersion of funds throughout your lifetime and beyond.
If you already have a plan, take a look to see if you are on track or ahead of schedule? Have you experienced any major life changes that may modify your initial thoughts or direction? Or perhaps you aren’t quite at the stage of starting to plan yet, as there are many components to consider. When the time is right, give us a call, and together with our team of specialists with Odlum Brown Financial Services Limited, we can help you get started. Bring on 2022!
*Available through Odlum Brown Financial Services Limited, a wholly owned subsidiary of Odlum Brown Limited offering life insurance products, retirement, estate and financial planning exclusively to Odlum Brown clients.
2021: Below the Surface
by Shelly Appleton-Benko | January 7, 2022
What a year 2021 was for the markets! Attached is a quick look at some key factors that played a role in the excellent returns, despite the effects of the pandemic. Why are portfolios doing so well during this difficult time? What does the future have in store as we look forward to the economic recovery ahead?
Click the graphic to take a look at our 2021 Year in Review:
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