Tuesday, May 24, 2011

Product Allocation and Asset Allocation - do you know the difference?

Putting all your eggs in one basket is never a good idea  - ask those who invested all their disposable, and maybe even some borrowed funds, in Nortel stock what can happen!
Asset allocation is used to spread your risk among several different types of assets including:
  • cash and cash equivalents including money market funds, 
  • fixed interest securities (GICs, term deposits, government bonds, corporate bonds),
  • equities (preferred stocks, common stocks etc).
Conservative asset allocation strategies, when properly applied, can be effective in protecting you from big swings in the market. However, asset allocation by itself is not enough to fully protect your retirement nest egg..

Product allocation,on the other hand, is a way of further diversifying your investments and involves placing your assets into three distinct product categories to help provide a sustainable retirement income. 
An entertaining and useful explanation of this strategy is presented by a math professor and an investment advisor in "Pensionize your nest egg".

For more information about how to get started on your own personal pension plan you can contact us at Celesta Financial to learn more about how we can help you achieve your goals for retirement.  You can also learn more details about this concept of retirement planning at a website developed by Manulife Financial. See Help my savings last.

The many faces of annuities

Annuities have come a long way. There are now many options and riders that can be added to enhance their value. Morningstar has an interesting read on this topic entitled The many faces of annuities .

Thursday, May 19, 2011

Your thoughts can make you richer - in 21 days

Napoleon Hill's famous book "Think and Grow Rich" originally published in 1937 during the Great Depression gave us some useful principles on which we can begin increasing our wealth and living richer more productive lives. His ideas are still valid even if a bit out of date. A new book entitled "The Wealthy Spirit" by Chellie Campbell goes a step further and challenges us to use affirmations for 21 days and prepare for positive results. You can create your own positive affirmations or use suggestions in the book such as "People love to give me money"! but you really need to believe it works in order to see results. Try it out and see what happens!

Your beliefs about money can hurt you

 An interesting study by Klontz et al on Money Beliefs and Financial Behavior in the Journal of Financial Therapy  indicates that your beliefs about money can be harmful to you.   People who focus on money worship, money avoidance and money status usually have less money than the people who don’t. For a good summary of the study  see this article by Angela Self at the Globe and Mail:   Your money beliefs could be hurting your bottom line.

Tuesday, May 17, 2011

Trouble with the taxman?

Having issues with your notice of assessment from CRA? The Taxpayers Ombudsman may be able to help. See http://www.oto-boc.gc.ca/dlng-eng.html

Thursday, May 12, 2011

Defined benefit pension plans

Defined benefit pension plans are becoming more and more rare. You can create your own equivalent to this type of plan. Contact us to find out how.

Also see http://tinyurl.com/Defined-benefit-pension-plans
Financial crisis appears to have fuelled a growing shift by companies to defined contribution plans.

Thursday, May 5, 2011

Best rates for a GIC

Nervous about the market and wondering where you can get the best rates for a GIC? Contact us at Celesta Financial for GIC and short-term deposit rates that are consistently among the highest available -- typically significantly higher than the retail rates posted by Canada’s ‘big five’ banks.


Sunday, May 1, 2011

Take a close look at your finances

Now that your tax return has been filed it is time to take a close look at your finances to see how you can save tax for the next year. Take a look at this useful site for updates on new tax rules http://www.taxtips.ca/
TaxTips.ca - Canadian tax, financial and investing information and calculators for individuals and business