Ever wonder what a financial advisor does? Well, you’re in luck. This week’s episode is a Q&A with Rob Anderson who is a Canadian financial advisor. We chat about what financial advisors do, different types of advisors, different fee models, how they can help you, who can benefit from having a financial advisor, and more.

Key Takeaways

  • A financial advisor doesn’t just invest money for you. There are so many things they do, from tax planning, estate planning, cash flow management, investment management, and risk management (insurance)
  • Look for the CFP (Certified Financial Planner) designation, as it is the most widely recognized financial planning designation in Canada
  • A good financial advisor can help refer you to other professionals that can help you with different aspects of your financial life
  • Financial advisors get paid in different ways – sometimes they are fee-based, and would take a percentage of assets under management, and some are fee-only which means they charge per hour or charge per plan. There is also commission-based which means the advisor will get paid from the insurance or fund company for the products they sell to you.
    • Look for fee-only advisors who will charge you per financial plan or hourly
  • “The right advice at the right time can be very powerful and is worth paying for”  
  • Everyone can benefit from a financial advisor at some point in their life – when you’re starting out and getting organized
    • Different life stages would be a good time to meet with an advisor, whether it’s starting a new job, starting a business, starting a family, approaching retirement, planning for retirement
  • A financial advisor can be a good neutral party to encourage couples to be more engaged in their finances, managing people and emotions
  • Once a year is a good starting point to meet with your advisor, but you can do more depending on your situation and the level of involvement you’d like to have
  • How to find a financial advisor that’s right for you? Ask your friends or family for a referral, you can look online and see reviews, you should also consider their age – find someone who can relate to you and be there during your different life stages
  • A good financial advisor can be a great tool to achieve your financial goals

Rob’s Links

Instagram – Beaver Finance

Instagram – RTA Talks

Twitter

Youtube

Listen Now!

 

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Bev, creator of Bacon and Heels, and I talk about setting financial goals. We break it down from determining what your values are, to setting SMART goals, to breaking a daunting task into bite-sized pieces, to celebrating your wins.

Key Takeaways

  • Financial goals can be different things to different people. Examples include savings targets, spending targets, and investing targets
  • Make sure you’re accountable to yourself by having a spending plan or budget
  • When you achieve and get closer to your financial goals, you will feel great and encourage you to set more goals and achieve them
  • Set a goal at any day – it doesn’t need to be a new year’s resolution
  • Bev likes to see her financial goal daily. She has a post-it note on her mirror that has her goal written out on it. Make it your phone or desktop background. Put it in a physical place where you can see it
  • Set SMART goals – Specific, Measurable, Achievable, Relevant, and Timely
  • Talk about it with your close friends or loved ones, and you can hold each other accountable to your financial goals
  • Celebrate your wins! Each time you hit a milestone in your goal, make sure you acknowledge yourself and your discipline!

Bev’s Links

https://www.baconheels.com/

Instagram

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Personal finance coach Michael Kim and I chat about common mistakes that new investors make, and how to avoid them. We also chat about Mike’s investing journey, as well as his relationship with money and why he started his coaching business. 

Key Takeaways

  • Passive vs Active Investing: passive is buying and holding with the goal of matching the market. Active is characteristically more trading activity (i.e. buying and selling frequently) with the aim of beating the market\
  • Mike uses a passive investing strategy because there is the least amount of room for error and he believes it is the best use of his time TIME
  • The four mistakes new investors make are:
  1. Not investing for a purpose. You should invest to achieve your financial goals. Answering that question will help you decide what to invest in
  2. Not having a strategy. Do you know what you are going to do if a recession occurs/lose your job/get closer to your financial goals? Definitely have a plan in place so that you know what to do in every single one of these scenarios.
  3. Investing without a foundation – it’s important to understand the basics of investing, and understand what you are investing in, such as different asset classes, what a TFSA is, what an RRSP is, etc.  
  4. Thinking investing will solve all your problems because you need a lot of money to generate a significant return. There are other areas to focus your time on to potentially make more money (i.e. start a side hustle), then you will have a larger nest egg to invest and be able to generate larger returns on investment

Tips/Tricks:
Investing is not hard, it’s as simple as going to a website on Amazon and clicking buy
To start investing, you don’t start with investing.
First look at your financial goals, your current financial situation, and your budget and emergency fund
Once you’ve done the groundwork, you’ll know what to invest in

Mike’s Links

http://lifeplanting.com/

Instagram

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Mindful spending when it comes to retail shopping (Part 2)! Wendy is back and we chat about ways to save money while still enjoying the shopping experience, alternatives to retail therapy, thrifting, how to find your personal style, capsule wardrobes, reselling your clothes on different platforms, and more.

Key Takeaways

  • Finding your personal style is all about understanding your lifestyle – what your day-to-day life is, where you spend the majority of your time, and what foundational pieces you need to build your wardrobe. High-quality basics could make you happier when you wear them.  
  • Thrifting is a good way to shop sustainably. The Market is a store in Toronto you can buy clothes “by the pound”. Plato’s Closet is also a great option for a more curated thrift store experience.
  • You can also buy and sell used clothing on websites like Poshmark, Kijiji, Depop. Be patient with selling your clothes, if it’s a classic piece that will come back season after season, don’t rush the process.
  • If you have a formal event like a wedding to attend, borrow something from a friend!
  • Track your mood and look at the days you are happiest. They probably won’t be correlated with the days you spend the most money. Consumption of goods isn’t necessarily a source of happiness.
  • Cleanse your Instagram and emails to unsubscribe from retailers emails

Listen Now!

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Mindful spending when it comes to retail shopping! My friend Wendy and I chat about ways to save money while still enjoying the shopping experience – she shares tips and tricks like making a list to determine if it’s really something you want vs. an impulse buy, and not to add on to your shopping cart just for the sake of free shipping. Wendy says it’s possible to be less materialistic without learning to unlove material goods.

Key Takeaways

  • Marketing is all around us and it’s unavoidable. The ads are becoming more targeted towards you as a consumer. Unfollow retail companies on social media because you’re essentially subscribing to their advertisements.
  • Use a wishlist – keep it on your phone or write it down – what it is and how much it costs, and go back to it, compare and contrast the items on the list, and cross off things you might now want as much
  • Buy now pay later allows people to use installment payments for retail purchases. They’re interest-free until you are late on a payment. You could potentially end up paying more for it.
  • Take good care of your clothes so they last longer and you value the money you put into it
  • Spend within your means

Listen Now!

Links

CNBC – Do Point of Sale Loans Cause Overspending?

MoneySense – Buy Now Pay Later

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Tom Drake, founder of MapleMoney is here this week to share his journey starting his blog and podcast to becoming one of the most popular Canadian personal finance brands. We chat about Tom’s relationship with money, the beginnings of MapleMoney, staying motivated, and Tom shares some wisdom for new content creators on things he wishes he knew when he was starting out. If you’re reading this and you’ve thought of starting something, this is your sign to start your content creation journey TODAY!

Key Takeaways

  • Just get started already! There’s no perfect time, don’t wait until you have everything perfect because you’ll get it over time and with experience
  • Tom’s advice to new content creators is to just trust the process and not try to rush growth. Focus on reaching your target audience and be consistent!
  • Having multiple income streams is the same thing as diversifying your portfolio. When you have a side hustle you can make your own 10% raise in a year just by having an extra income stream
  • Don’t compare yourself to others! It’s important to remember that you’re on your own journey, and comparisons won’t do you any good
  • Tom’s side hustle as a blogger/podcaster has turned into his main hustle, but he’s still kept his 9-5 because he’s able to do both and still have time for himself and his family

Listen Now!

Links

https://maplemoney.com

http://www.tomdrake.net

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This week’s episode is all about what happened with GameStop stock over the past few weeks. $GME, Wall Street Bets on Reddit, hedge funds, options trading, short squeezes, gamma squeezes, market forces. All explained this week with the help of my friend Runda. What really happened? Why now? Did WSB stick it to the man? Is it over? Has the squeeze been squoze? Where are the shares? We talk all about what happened on the stock market over the past couple weeks. And of course, Runda brings up blockchain technology and how it can revolutionize global stock trading.

Listen Now!

Links

https://wherearetheshares.com/

https://isthesqueezesquoze.com/

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This week’s episode is all about buying your first home (Part 2). My friend Denise and I chat about buying a property. Denise is a home owner and has gone through the whole home buying process recently, so is full of up to date, handy information to share with us. In part 2 this week, we cover getting a real estate agent, budgeting for home expenses, house hacking, and more.

Key Takeaways

  1. As a buyer, you don’t pay a real estate agent anything. The seller is the one who pays commissions (around 5% of the sale of the home). The selling agent would get 2.5% and the buying agent would get 2.5%. You’re able to work with different realtors who specialize in different areas if you’re not set on a certain municipality or region.
  2. When buying a resale home, it’s important to get an inspection report – this indicates potential things that could be wrong with the house (i.e. how is the roof, how’s the plumbing, how’s the exterior). However a home inspector can’t open dry wall and see what’s inside the walls so it’s important to have an emergency fund for unexpected expenses.
  3. Land transfer tax is a large one-time fee that you pay on closing as a buyer. It’s a marginal rate – you can find the link for Ontario below. In Toronto, that tax is doubled. There are incentives for first time home buyers.
  4. Make sure you get a good real estate lawyer! They will make sure your land transfer tax is calculated correctly, any rebates you’re entitled to are applied, and they will run a title search on the previous ownership of the house. This is really important to make sure everything is good with the previous ownership!
  5. Consider buying appliances instead of renting (i.e. hot water tanks). It could be worthwhile to purchase outright in the beginning.
  6. Consider house hacking! Buy a property, rent out a room or your basement suite. However, ensure that your basement apartment is in compliance with municipal codes. For example, Brampton, Ontario has really strict guidelines on basement apartments.
  7. Understand what you can afford and budget for everything!

Listen Now!

Links

Tarion Warranty on new homes

Land transfer tax in Ontario

Mortgage Calculator(from Gov’t of Canada)

Basement apartment regulations – Toronto

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This week’s episode is all about buying your first home!! My friend Denise and I chat about buying a property. Denise is a home owner and has gone through the whole home buying process recently, so is full of up to date, handy information to share with us. In part 1 this week, we focus on mortgages, saving for a down payment, and also chat about different types of properties and how to budget for buying a place, as well as something you can use to help buy a home that feels illegal but isn’t.

Please tune in next week for part two where we cover getting a real estate agent, budgeting for home expenses and more.

Key Takeaways

  1. The first thing you should do when thinking about buying a property is establish what you can afford. Look around at the market, and the neighbourhoods you’d like to live in. Look at real estate websites to see what prices are like:
  2. The different types of properties you can buy are: condo, townhouse, freehold townhouse, detached house, semi-detached house. Each have their pros and cons, for example with a detached house, you own this piece of land, but there is a lot of upkeep involved (i.e. snow shovelling, lawn mowing, etc.). It’s important for you to write down a pros and cons list and determine what is important to you.
  3. You can take up to $35,000 out of your RRSP, tax-free, if you’re a first time homebuyer to fund the purchase of your first home. This is called the Home Buyer’s Plan and is a great incentive. You have two years to wait until you have to start repaying this into your RRSP, and then you repay it back into your RRSP over 15 years. This is a super incentive because you get this tax-free money, and in the future you will still have this money for your retirement in the future.
  4. It’s important to talk to a lender to determine what you can afford when looking for a mortgage. There is a new mortgage stress test in place (more info in links section below), which makes it harder to get a mortgage. Things like a higher credit score, and gross debt ratio and total debt ratio
  5. Mortgage terms can depend on your situation, and the rates will be different depending on the length of the mortgage. Usually they’re five years, but this can differ.
  6. A 20% down payment is required to not need to pay mortgage insurance. For a property that costs less than $500,000, the minimum down payment is 5% (with mortgage insurance). For a property that costs more than $500,000, the minimum down payment is 5% on the first $500k and 10% on the excess to a limit of $1m.

Listen Now!

Links

CMHC Mortgage Loan Insurance and Premiums

Mortgage Affordability Calculator

Mortgage stress test further reading

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This week’s episode is all about co-living, or shared housing! Derek Baker and I chat about what co-living is, how it differs from a traditional roomie or hostel situation, its benefits and drawbacks, how to determine if this is a living situation that is right for you, and find a place that is right for you. We also talk about how it looks like in a Covid environment, and Derek’s upcoming co-living plans (on a shoestring budget!)

I’ve always been curious about what the future would look like with regard to more of a sharing economy. There is a lack of affordable housing in major cities across North America, and along with that, people are feeling more isolated now, despite living amongst so many other people. Living in a space with others who are like-minded and share similar values would be a great way to make new connections without the hassle of having everyone on the same lease. Would co-living be the answer to this? As we chatted, I’ve become more convinced of the model.

Key Takeaways

  1. The co-living principle is shared living with the intent of creating intentional community and bringing together people with similar values and goals. Think urban hippie commune, but more luxurious.
  2. It is a great option for remote workers or digital nomads who want to have flexible living terms and travel – leases are typically one to three months in length, so you’re not tied down to one location for long periods of time.
  3. Co-living is a great option to reduce living costs in high cost of living cities and still have access to a comfortable living space with amenities. For example, linens are included as well as weekly professional cleaning of the common areas.
  4. There are private room and shared room options. The shared room options may differ but think upgraded hostel bunk beds.
  5. This is also a great option to travel for longer periods of time internationally. China and India have growing co-living communities, enabling you to stay in cities for longer than a few days or weeks, while still having the benefits of hostels (events, meeting people, location, etc.)
  6. Find co-living spaces through search engines that specialize in long-term stays such as:

Listen Now!

Links

Check out Derek’s blogFreedom Coliving

Follow Derek onInstagram (personal)or his Freedom Coliving account

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