Be Prepared For Emergencies & Opportunities

Randy worked for a small business. When the owner died suddenly, the business accounts were frozen and it took several weeks before they could be accessed to meet payroll. Randy had trouble meeting his financial obligations and had to find a new job.

Jane worked at a small company for many years. When the owner decided to retire, she offered to sell the business to Jane. As she didn't have the funds available, the business was sold to someone else. The new owner let Jane go shortly after taking over.

Joe and Gayle had been renting a house for several years. When the owners decided to sell, they offered it to Joe and Gayle first. Because they didn't have enough for a down payment, they couldn't afford to buy the house and also had to move.

It seems that many people today are so busy living a lifestyle, they forget that emergencies and opportunities need to be dealt with. Randy, Jane, and Joe and Gayle would have been able to deal with their situations more favourably if they had established emergency and opportunity funds.

It's all too easy to start taking one's cash flow for granted and get lulled into the belief that it will go on uninterrupted. Many fall into the trap of trying to save money after all other payments are made. Usually, there is little or nothing left to save this way. Those who are best able to handle emergencies and opportunities that arise are in the habit of paying themselves first. How do you pay yourself first? There are many ways and they include:

High Interest Bank Accounts - This may sound like an oxymoron, but there actually are a few banks that offer high interest savings accounts; some with chequing privileges, too. Bear in mind that any interest earned on money in these accounts is fully taxable. However, most bank accounts are readily accessible, so it can be easy to withdraw funds for things that aren't really emergencies or opportunities.

Guaranteed Interest Certificates (GICs) - Funds can be deposited for a certain period at a fixed interest rate. The interest is fully taxable, even if left on deposit in the GIC. Because GICs are for a fixed period, funds may not be available at the precise time they are needed.

Tax Free Savings Accounts (TFSA) Introduced a few years ago, these plans allow you to earn growth on your deposits without paying taxes on it. Withdrawals can be replenished in the future and your investment choices mimic RRSP options.

Universal Life Insurance- These policies can combine protection and savings in one plan. The minimum premium is set at a level to cover the cost of the death benefit. The policyowner can choose to pay more, within certain limits, and these extra premiums accumulate on a tax deferred basis. Generally paid out as part of the death benefit, the extra deposits can also be accessed, depending on the company, by withdrawal or policy loan.

'When prosperity comes, do not use all of it.'

- Confucius


*Fictional characters for illustrative purposes only.



Questions about your money
management strategy?

Contact our office!

Copyright © 2019 AdvisorNet Communications Inc. All rights reserved. This article is provided for informational purposes only and is not intended to provide specific financial advice. It is strongly recommended that the reader seek qualified professional advice before making any financial decisions based on anything discussed in this article. This article is not to be copied or republished in any format for any reason without the written permission of the AdvisorNet Communications. The publisher does not guarantee the accuracy of the information and is not liable in any way for any error or omission.

What our clients are saying...

  • We appreciate Anthony’s efficiency, his friendly demeanour and ability to listen to our concerns. We value his honesty and willingness to adhere to our wishes, with an understanding of possible implications and his commitment to explain any negative consequences accordingly. Anthony searched out new life insurance coverage as part of our estate planning. He was thorough and communicated each step in the process to us in a timely manner. We wanted someone who thoroughly understands the financial markets and can explain them in a comprehensible manner. We wanted to work with someone who can respond readily to our needs and who can provide proper advice. Anthony delivered on what he promised and definitely met our expectations. We would absolutely recommend Anthony to our family and friends.

  • I valued Anthony’s insight and recommendation for my investments. When working with a Financial planner I am looking for value and "best bang for my bucks". He was definitely able to meet my expectations and I would be glad to refer him to family, friends and work associates.

  • Anthony was clear, concise, easy to understand and provided useful comparative statistics for our investments moving forward. Our expectations when working with a Financial Planner is that he/she will provide expertise and knowledge with regards to our investments and provide portfolio recommendations best suited to meet our goals and objectives. Anthony definitely met our expectations and we would feel comfortable referring his services to family, friends and work associates.

  • I valued Anthony taking the time to understand my needs and goals. My expectation when working with a Financial Planner is that he/she will provide guidance in respect of the options and providing clear instructions as to the expectations from me in order to achieve the goals set out. He was able to provide realistic options and clear instructions to obtain my goals and objectives. Anthony definitely met my expectations and I would feel comfortable referring his services to my family, friends and work associates.

  • My expectation when working with a Financial Planner is to have all the answers I need and to put together a plan that can work for me and my family. I valued Anthony clearly explaining and developing a concise plan as to how I can achieve the goals we set out for our family. Anthony has definitely met my expectations and I would be happy to refer to him my family and friends.

  • We appreciated Anthony's willingness to answer our questions with transparency and an appropriate amount of detail. Anthony is an extremely patient and engaged listener. He explains concepts in a way that we could easily absorb. He remembers details about our concerns and plans, and applies those elements to his recommendations on our financial management. He asks for our input and appears to remain flexible to our ideas and needs. He laid out a specific mix for our investments and explained why these are good choices for us based on his knowledge of our needs and preferences. We have enjoyed working with Anthony so far, and if our newly expanded relationship proves profitable, we certainly would recommend him to our family and friends.