On today’s episode we have another Canadian guest, Kyle Prevost, who achieved financial independence at an early age (he was able to pull it off in his 30s). He’s also done hundreds of financial talks and interviews over the years with both regular Canadians, and some of the most highly respected financial experts in both Canada and the US.

In this episode, we discuss what he’s learned from these hundreds of discussions that he’s had, especially when it comes to best practices and financial tactics that we can apply to our own lives.

He also shares advice on how he personally minimizes and thinks about fees in his own investment portfolio, and we also discuss his findings on CPP and OAS in Canada, which in case you’re not familiar, are the two main income sources from the government that Canadians rely on in their retirement. Kyle has done a bunch of research and interviews on how viable the CPP and OAS is long-term, and if we can continue to expect to receive them in our older age, even if we’re nowhere near that traditional retirement age of 65 yet.

We cover all this and more in the interview.

Also, free tickets to the Canadian Financial Summit:

Kyle and I have run the Canadian Financial Summit together for years in the past, this year I’m attending it as one of the speakers, and I have free tickets for you which you can get at buildwealthcanada.ca/summit.

In case you’re new to the Summit, it’s a fully online event for Canadians where you can stream all the educational talks. I’ll be speaking at it again this year, this time about RRSPs, and I’ll be there with 36 other Canadian personal finance and investing experts who will be sharing their expertise and best practices when it comes to investing, retirement, financial planning, ETFs, pensions, cash flow management once you hit your financial independence number, and much more.

It’s happening really soon this month, October 23-26. I hope to see you there, and again you can get free tickets to the event by going to buildwealthcanada.ca/summit

I hope to see you there!

Kornel

We all spend decades accumulating and growing our net worth, along with many hours of research and studying to optimize our investments and minimize our taxes as Canadians. But what if a single incident wipes all that out? or even just a large portion of it out? Wouldn't it be completely irrational to not eliminate that risk?

The best solution that I can think of for accomplishing this is insurance, so I thought it would be helpful to come up with a checklist that you can use of the different types of insurance available for us Canadians, so that you can go through it, one by one, and decide which types make sense for you, to protect your net worth.

After that, we do a minor pivot to talk about dental insurance and medical insurance for us Canadians. I have been spending an obscene amount on dental care with our two kids. It's super expensive, it stresses me out, and so I wanted to learn more about what the options are for us Canadians when it comes to dental coverage, along with getting medical coverage for things that aren't covered by the government, here in Canada.

To help me with this, I brought back one of our popular returning guests, Laura MacKay. Laura is the co-founder and COO of policyme.com, Canada's fastest-growing digital insurance company.

In 2021, she was named one of the Women of the Year by Bay Street Bull. She has a Bachelor of Mathematics from the University of Waterloo, and her degree focused on Actuarial Science, which included learning about mortality risk, the basis of life insurance pricing and valuation.

Laura is also joined by her colleague Natalie Dupley, who comes from the not-for-profit sector. Natalie is now a licensed insurance advisor that works with Laura, and specializes in life, accident, and sickness insurance.

About Laura's Company: PolicyMe.com

Educational Guides from the Episode:

Types of Dental Insurance Plans in Canada

The Canadian Guide to Health Insurance Plans

What is Life Insurance: Meaning & Comprehensive Guide

1. To kick things off, can you take us through what insurance us Canadians typically need, so that we don’t miss out on any critical coverage that we should have?

2. One type of coverage that I think isn’t always thought about for us Canadians is health and dental insurance, particularly since we’re used to having most of our medical expenses covered by the government. Can you take us through some common misconceptions about health and dental insurance, as well as who it would be most useful for?

3. When I think of cases where I need insurance, it’s typically for very sudden and time sensitive events like a car crash, or dental procedure that I need done as soon as possible. But what about having insurance for things that are less sudden like therapy and mental health, or things like braces or corrective eye procedures like LASIK surgery? How does having private insurance work in those cases?

4. When it comes to this type of insurance, how do we determine if it’s more financially sensible to pay-out-of-pocket for these healthcare costs vs purchasing a Health & Dental Insurance plan?

5. Before we continue with more educational questions, I wanted to give you a chance to speak about PolicyMe, what you do, and I realise that you also specialise in health and dental insurance so perhaps you could speak about that?

6. What are the key components to look for when evaluating this type of insurance?

7. When it comes to health and dental insurance plans, is this something that also covers you when travelling? Or would that be separate?

8. Of all the things covered under a Health & Dental plan, what areas of coverage do most Canadians prioritise or care about? and what are some areas of coverage that you think are underutilised (or that Canadians can stand to benefit from more)?

9. What are some of the most common questions that Canadians ask when it comes to health and dental insurance?

10. Can you tell us more about PolicyMe, how you differentiate yourselves, and what you offer?

This interview will be a bit different as I was recently interviewed by Financial Journalist, Ellen Roseman from Canadian MoneySaver Magazine where she asked me some great questions, and so I thought it would be great to also publish that interview, here on the Build Wealth Canada Show.

In the interview, we cover what lessons for Canadians I have learned after doing close to two hundred interviews with financial experts, over the past 10 years.

My wife and I have also been either fully or semi-retired for the past 8 years, and so Ellen asked me if I have any advice for those who are also planning to retire in their 30s like us, or just retire early in general, and she asks what kind of financial changes or challenges were we surprised by that you should know about to help you with your own journey towards financial independence and early retirement.

Ellen has also been teaching investing at the University of Toronto for the past 20 years, so in the interview, she also shares some of her lessons learned over that time.

Enjoy the episode, and if you’d like to hear more interviews done by Ellen, you can check them out on the Canadian MoneySaver Podcast which you can find in your favourite podcast player.

Thanks for tuning in, and you can get all the show notes and free resources over at BuildWealthCanada.ca.

In this episode, I interview two professional financial planners to discover what are the most common questions that they receive when working with Canadians.

Our two guests are also going to cover what the most important and frequently occurring blind spots are that we Canadians tend to make in our own finances.

We also cover how to know if you are on-track to reach financial independence and retire early, or if you have enough to retire comfortably.

We cover all this and more, as we tackle the top questions that Canadians have, here in Canada.

Our guests today are Hannah McVean and Thuy Lam from Objective Financial Partners. They are both fee-for-service financial planners, are both Certified Financial Planners (CFP), and they and their firm don’t sell any investments and instead focus on providing unbiased, conflict-free financial planning advice.

Hannah was actually a guest on our January episode with Jason Heath and that was our most popular episode this year. So, it’s great to have her back, along with Thuy to get multiple perspectives on these most popular questions that Canadians have.

You can book a free introductory meeting with Hannah, Thuy and their team at buildwealthcanada.ca/plan. As a Build Wealth Canada listener, you’ll get 10% off if you end up working with them. The discount is for a limited time, and you can sign up for free here. A big thanks to Hannah and Thuy for offering this to Build Wealth Canada listeners.

When we first hit our financial independence number 8 years ago, one of the financial planners that I asked to look at our numbers before my wife and I quit our full-time jobs was Ed Rempel. At the time, I asked Ed if he could do his own math and analysis on our numbers, to make sure that I didn’t miscalculate something when I was doing it myself, and this way I could be certain that my wife and I could quit our jobs and live off our portfolio going forward.

Well, fast forward to today, it’s been around 8 years since we quit our full-time jobs, and so I thought it would be helpful to have Ed back on the show and to once again use us as a case study on how one can live off their portfolio in a sustainable, stress free, and tax efficient way, here in Canada.

On this episode, you’re going to learn what strategies and frameworks tend to work when it comes to living off your portfolio here in Canada.

You’ll learn about a big mistake that I made which was actually causing me money anxiety even though our investment portfolio was going up in value. Ed helped me get through that, and it’s a mistake that is actually totally avoidable, and a skill that you can start building and mastering today.

And, when it comes to a strategy for paying the least amount of tax in Canada, Ed takes us through two main strategies that you can choose depending on your situation so that you pay the least amount of tax throughout your lifetime.

We cover all this and much more in the interview.

Links, show notes and free resources are all available at BuildWealthCanada.ca.

Having your investments pay you large dividends or yield sounds great. It’s truly passive income where money just shows up in your account without you having to do anything, and without you having to sell off any of your investments even when markets are down.

But what if you get too focused on maximizing dividends or yield in your portfolio? After all, there is no free lunch when it comes to investing. There are always tradeoffs, and it turns out that there are some pretty significant disadvantages for investors that just try to maximize their yield or dividends at all costs, and it can result in you actually getting a substantially lower "total return" over time, on your investments.

To help us learn what pitfalls to look out for when deciding on our investments, particularly when it comes to some of these very high yielding ETFs that you may be seeing recommended online, we have Chris Heakes.

Chris has over 14 years of experience in the investment industry. He’s a CFA, has a Master of Finance from the University of Toronto, and is a Director and Portfolio Manager at BMO Global Asset Management.

Chris is going to take us through what we should look out for so that we don’t fall for the yield trap.

We’ll also cover hidden fees that you may be unknowingly paying on some ETF, along with some arguably deceptive advertising to look out for that you may have seen here in Canada when it comes to your investments.

Lots to learn in this interview with Chris, so let’s jump right in.

You can see all the show notes, resources and links for this episode over at BuildWealthCanada.ca

A big thanks to RBC for sponsoring this episode.

We talk a lot about growing our net worth as Canadians, but what about actually protecting our assets from threats like fraud?

So, I thought we’d get some security experts on the show to teach us some best practices when it comes to protecting ourselves and our family, especially when it comes to our finances, here in Canada.

They are part of the security teams at the largest bank in Canada. They have entire teams devoted to security and invest a lot of time and money to ensure that they and their clients are following the best practices.

Today, you and I are going to learn what we can do as regular Canadians, to best protect ourselves.

Our first guest is Kevin Purkiss who is the Vice President of Fraud Management at RBC. He leads the team responsible for managing RBC’s fraud capabilities, and helps protect the many thousands of Canadians that they serve.

Next, we have Kevin’s colleague, Vice-President, Shekher Puri, who’s going to take us through some additional best practices that you and I should be using, to enhance our security, especially when it comes to our finances.

And now let’s jump in to learn what you and I should be doing to better protect ourselves.

RBC Disclaimer: This content in this podcast is intended as general information only and is not to be relied upon as constituting legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. The information presented is believed to be factual and up-to-date but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or any of its affiliates.

When it comes to managing our investment portfolios, there are definitely some mistakes that are easy to make, and ones that a lot of Canadian investors tend to do.

In this episode, we have Peter McMurtry on the show who is going to take us through what the common mistakes are that Canadian investors tend to do, as well as the best practices that he's noticed from his 30+ years in the investing industry.

One of the things Peter does is portfolio reviews for his clients, so I wanted to pick his brain on the common mistakes that he sees investors make when he reviews their portfolios so that you and I can be sure to avoid those mistakes in our own portfolio.

On the flip side, he’s also worked with clients that are successful investors, and after doing this for 30+ years, one begins to notice certain patterns about what the successful investors do, that the unsuccessful don’t. We go into these best practices that he’s noticed over the years from these successful investors, so that we can apply these lessons ourselves.

Enjoy the show, and you can get the show notes and resources over at BuildWealthCanada.ca

Wishing you all the best,

Kornel

With inflation slowing down here in Canada, we are starting to hear talks about the Bank of Canada no longer planning to increase our interest rates, or maybe even lowering them.

This can have an impact on your investment portfolio, particularly if you hold bonds, because remember there is that inverse relationship between interest rates and bonds, where increases in the interest rate tend to lower the value of the bonds that you hold in your portfolio. On the flip side, if the Bank of Canada lowers our rates, you can expect your bonds to increase in value.

Apart from your investments, the interest rate can of course have a substantial impact on your month-to-month cashflow, when it comes to things like mortgages as well as the real estate market in general.

So, with Spring just around the corner and the real estate buying and selling season about to kick-off, I thought it would be great to have our Resident Mortgage Expert, Sean Cooper back on the show to discuss:

-What Canadians should be thinking about when it comes to their mortgages right now.

-Should you do a fixed rate or variable rate mortgage if you’re buying a home or have a mortgage coming up for renewal?

-What if you’re considering locking in your mortgage to a fixed rate?

The optimum answer for all of this can change for you depending on what is happening in the market right now and your own situation, so Sean takes us through the different things you should consider.

You’ll also learn, what your options are if you find a better mortgage than what you have right now. What if the rates do drop and you’re now able to get a less expensive mortgage? Can you switch? What can the penalties be? And, can it be worth it to pay those penalties if you find a better mortgage?

In case this is your first time hearing Sean on the show, he is the show’s Resident Mortgage Expert and who I go to and who I send friends and family to for any mortgage related questions.

Sean is the bestselling author of the book, Burn Your Mortgage: The Simple, Powerful Path to Financial Freedom for Canadians.

He is also an independent mortgage broker and has made himself available to help answer mortgage related questions to listeners of the Build Wealth Canada Show.

If you have any questions, or are just looking to get a shortlist of the best mortgages that he’s been able to find in Canada (since he’s constantly on the lookout for the best mortgages), you can reach out to him over at buildwealthcanada.ca/sean.

And now, let’s get into the interview.

Today, we’re going to cover what you need to know from a tax, investing, and financial planning perspective as we head into this new year.

As you know, the government makes changes every year in these areas and the implications of these changes can have a pretty substantial impact on how much you pay in taxes, your net worth, what government benefits you are eligible to get, and how much you get.

These can easily affect your net worth in the thousands of dollars every single year, so it’s definitely in your and my best interest to know about these changes and get a bit of a refresher, so that we can all better prepare, and also take advantage of any opportunities that arise.

To help me with this, I have Certified Financial Planners Jason Heath, and Hannah McVean on the show. Jason is a popular returning guest on the show, definitely one of the more well known and respected financial planners, here in Canada. 

Hannah and Jason are both fee-only financial planners, which means they don’t sell any investments so there isn’t that potential conflict-of-interest that you see a lot of here in Canada where someone calls themselves a financial planner or a financial advisor, you think you’re getting a good financial plan and that they have your best interests at heart, but really they are just trying to get you to buy the investments that their firm sells so that they can earn a hefty commission.

None of that here, we’re going for purely unbiased financial education with Hannah and Jason.

A quick little bio on these experts:

Jason has been providing fee-only, advice-only financial planning since 2002 (for well over a decade). He is also a personal finance columnist for the Financial Post, MoneySense, and Canadian MoneySaver. He has a Bachelor of Economics degree from York University and holds the Certified Financial Planner designation.

Hannah is also a Certified Financial Planner and a Chartered Investment Manager. She has experience working in the wealth management industry managing investments and filing taxes. She is now on the fee-only, advice-only financial planning side of things, and if you want to speak Jason, Hannah or someone from their team, you can reach them at BuildWealthCanada.ca/jason.

You can book a free introductory meeting with Jason and his team at buildwealthcanada.ca/jason. As a Build Wealth Canada listener, you'll get 10% off if you end up working with them. You'll also be entered into the giveaway to win a free financial plan. The discount and giveaway are for a limited time, and you can sign up for free here. 

1. To kick things off, can you take us through what we need to know for 2024, when it comes to our TFSA? and can you give us a quick refresher on how the TFSA works when it comes to taxes, and getting our contribution room back every year.
   1. Follow up question: Do you often suggest that clients keep their equities in their TFSAs due to their higher expected return compared to bonds and TFSA savings accounts?
2. What have you found to be the most efficient way for Canadians to determine how much TFSA contribution room they currently have?
3. Can you speak to how you can actually increase or decrease your available TFSA contribution room, depending on how your investments perform?
   1. Follow up question: How do you factor this in when you are doing financial planning for your clients?
   2. Follow up question 2: What kind of analysis do you do on TFSAs when you are working with clients and are there any optimizations or mistakes that people sometimes do that you are on the lookout for?
4. Let’s change gears and talk about RRSPs next. Are there any changes to RRSPs that we should be aware of for 2024, and for anybody new to all this, can you give us a refresher on how RRSPs work for us Canadians, when it comes to minimizing our taxes?
5. Can you speak about the RRSP loan strategy? This is something that we often hear mentioned in different blogs and books on finance for Canadians, but do they still make sense in this higher interest rate environment that we are now in? (please explain the strategy first for anybody not familiar)
6. When it comes to RRSPs, are there any common and/or critical mistakes that you see Canadians make, when you are doing financial plans for your clients?
7. The FHSA is a relatively new tool for Canadians. Can you speak to what it is, who is it for, and how do you like to analyze and factor it in, when working on financial plans for your clients?
8. Are there any new tax credits, deductions, or government benefits in 2024 that you think we should especially be aware of? and are there any that you find Canadians sometimes tend to miss?
9. What have you found to be the best way to ensure that we don’t miss any tax credits, deductions or government benefits that we are eligible for? (it’s a bit of an overwhelming list if we just google it)
10. Can take us through the updates for 2024, when it comes to the basic personal amount. And can you explain what it is and the financial planning implications of it, for anybody not familiar?
11. As we enter 2024, can you take us through a checklist of what you advise your clients to do as the year progresses? What should they be doing annually now, and as the year moves forward?
12. Is there anything else that you think Canadians should know about, from the taxation and government benefits side as we head into the new year?
13. I set up a page for you where show listeners can get a free consultation with your team, and that’s over at buildwealthcanada.ca/jason. Can you tell us a bit more about what problems and challenges you and your team specialize in solving for Canadians?

We’ve all heard of high interest savings accounts that we can open up at our bank. But is that always our one and only best option when it comes to where we keep our short term cash?

What about for things like our emergency fund, or when we are saving for something expensive like a car and we want that money to be available immediately when we need it, and not be subject to the sometimes large day-to-day fluctuations that we see in the stock market?

In this episode, you are going to learn what your options are, here in Canada, when it comes to that short term cash that you want to be readily available, without you having to worry about incurring any massive day-to-day fluctuations that you would typically see in the stock portion of your investment portfolio.

Today’s guest, Matt Montemurro is going to take us through the different options that we have, as Canadians, and he’s going to take us through the pros and cons of each of these options so that you can make your own educated decision on which option is the best one for you, based on your situation and risk tolerance.

Spoiler alert: The best solution isn’t always the traditional high interest savings account at your bank.

Make sure you stick around because there are actually some regulatory changes happening here in Canada, which are going to be impacting high interest savings ETFs.

A lot of Canadians have been investing pretty heavily in these, and now it’s gotten to the point where the regulators have started to take notice, and they are about to implement some pretty significant rule changes that can negatively impact some of your investments, if you purchase or are considering purchasing high interest savings ETFs.

A bit of a background about our guest:

Matt is a specialist when it comes to fixed income. He is currently the team lead for all fixed income portfolios managed by BMO ETFs, which is the largest Canadian ETF provider.

In his role as portfolio manager and trader, Matt and his team are responsible for all segments of the fixed income market, both in Canada and internationally. He has over a decade of experience in this field and holds an HBA and MBA from the Richard Ivey School of Business at the University of Western Ontario and is a CFA Charter holder (definitely a very difficult designation to get).

I’m thrilled to have him on the show, and I must say, speaking with him during this interview actually made me re-evaluate where I keep my short term cash.

I really wish we were all taught this back in school, as it’s important for us to know what our options are here in Canada, along with the pros and cons of each, instead of just always automatically defaulting to a regular high interest savings account at our bank.

Enjoy the interview, I learned an absolute ton, and I’m sure you will too. Let’s get into it.

Questions Covered:

1. The high interest savings account is something that most of us have heard of, and this is often the default choice for many of us when we’re saving for something, or using it as an emergency fund or as an account that pays for our day-to-day expenses. However, there are also high interest savings ETFs. What is the difference between those, and a high interest savings account that we would open up at a bank? Can you take us through the pros and cons of these two options and why wouldn’t someone just put their cash in their existing high interest savings account at their current bank?
2. There seem to be some changes coming up in 2024 when it comes to high interest savings ETFs. Can you take us through what those are, and how it will impact us regular Canadian investors? Follow up questions: Now that we know the significance of this, what should we do or start thinking about regarding these rate changes? Is a consequence of this that we should also expect to see the rates offered at banks for high interest savings accounts to drop?

3.    For those of us that do invest in high interest savings ETFs, can we expect a drop in those ETFs coming Jan 2024 because of a potential sell off?

Follow up: If not, how do sell-offs work when it comes to ETFs? For example, when there is a sell-off of a specific stock, we know that the price of the stock will plummet. But does it work differently with ETFs because ETFs consist of many different underlying assets?

4.    How is a high interest savings ETF different from a money market ETF? Can you take us through the pros and cons?

5.    How does using something like a high interest savings account compare to using something like a money market ETF instead (i.e. what are the pros and cons)? And for anybody not familiar, can you define what it means when an ETF is considered to be a “money market” ETF

6. For something like a money market ETF like ZMMK or a high interest savings ETF, would you expect the capital gain to be $0, because everything from that investment is coming in as income in the form of interest?

1. When we are comparing the interest rates that we can get on an ETF like ZMMK vs a high interest savings account, or a high interest savings ETF, when looking at the ETF page, should we be looking at the annualized distribution yield or the weighted average yield to maturity? And can you define what those are for us?

8.    While we are on the subject of ETFs that we can use for that relatively safe portion of our portfolio, can you speak to using ultra short-term bond ETFs instead of a money market ETF, like the ZMMK that we just talked about. What are these ultra short-term bond ETFs, and what are the pros and cons of using those, vs something like a money market ETF or even instead of just using a high interest savings account at our current bank.

1. 1. Follow-up question: I noticed that in your case, you also have a different variation of the ETF ZST which is ZST.L. What is the difference between the two? 

9.    When it comes to bond ETFs like ZST for example, can you teach us how they can have some tax advantages, in certain scenarios, over something like a high interest savings account?

10. Alright Matt, thanks so much for training us on all of this today. For everybody that wants to learn more, what’s the best place for them to go?