Outlook
A newsletter for clients & friends of ZLC Financial Group
Welcome to the Fall 2010 Are You Missing Out?
Edition of Outlook.
If you’re age 65+, chances are you may not are not automatically paid. You should
In this Issue Page be getting all the government benefits that apply at least 6 months before you want to
Are You Missing Out? 1 you’re entitled to. receive them.
Lifetime Gifts For Your 2
Children or Grandchildren Canada Pension Plan (CPP) provides Old Age Security (OAS) is paid to
What Happens if I Die 2 a basic safety net for those of us who Canadian citizens and legal residents who
Without a Will? contributed to the plan, and for those of have lived here at least 10 years after age
Investing in the “New Normal” 3 us who worked less time than needed to 18. To qualify for the maximum, you must
Making a Difference in the 3 maximize our pension, Guaranteed Income have lived in Canada for 40 years after age
Community Supplement (GIS) and various provincial 18. To receive OAS you should file at least
Don’t Miss Your 3 top ups can help make up the difference. 6 months before your 65th birthday. It is
5% Year End Bonus only retroactive for one year.
ZLC Financial Group, an independent Many seniors don’t know they’re missing
Vancouver-based team of experienced out on much needed income because they If you are between ages 60 and 64, and
professionals, is committed to building strong don’t know they qualify for GIS. These your spouse is age 65+ and receiving both
relationships and earning clients’ confidence benefits are retroactive for only 11 months, OAS and GIS, you may also be eligible for
through the delivery of high quality advice, so not applying in time results in forfeited the Old Age Security Allowance.
services and products. benefits. GIS must be applied for each
year, because it’s income tested. To receive Don’t forget to claim your Age credit,
Our four divisions include:
ZLC Insurance & Retirement Solutions
the GIS, you must be receiving OAS, which is income tested, and the Pension
Implementing personalized estate, financial and your income cannot exceed specified Income credit, if you have an employer
and retirement plans thresholds. pension or other eligible income (i.e.
interest from an insurance company’s term
ZLC Private Investment Management If you took time off or worked less while deposit). You should also consult with
Offering a diverse selection of top managed raising your children under the age of your tax advisor if splitting this income
portfolios 7, you can apply to CPP for the Child with your spouse makes sense. Besides
ZLC Employee Benefits
Rearing Provision to increase your future considering each of your marginal tax
Customizing employer sponsored benefit and pension. brackets, you’ll also want to consider
savings plans any impact on spousal, age and medical
Since CPP benefits can start as early as age expense credits, as well each spouse’s OAS
ZLC Structured Settlements 60, or be delayed as late as age 70, they (claw back).
Helping accident victims with lifetime income
solutions
Call us today and find out how we can be
valuable members of your planning team.
Lifetime Gifts For Your Children or Grandchildren Investing in the “New Normal”
What if you could give your children or their estate. In addition, when the parents We have seen a subtle shift over the last government authorities to stimulate the periods like 2009. The key is that the new
grandchildren a gift that could last for are named beneficiary, the investment couple of years that has changed what economy with very low interest rates and normal requires a less passive approach
life? Particularly if your cost was far less funds then receive protection from any we now perceive as a normal economic fiscal stimulus spending. to the market, and favors a more active
than the benefit they will enjoy? claims of creditors. environment. In the past, credit growth risk management approach. Focusing on
played a large part in increasing spending In the short to medium term, inflation select companies in select sectors helps
That’s what life insurance can do for your For those who like the certainty of and decreasing savings. Over the last is likely to remain low. This means that avoid the risks from potentially weaker
family. guarantees and not having to manage few decades, the personal savings rate investing in income producing securities areas of the economy. Van Arbor also has
investments, grandparents can also buy has fallen from 15% to 2%; but recently like dividend paying stocks and bonds are been holding companies for one or two
Buying universal or whole life policies a life annuity or annuity-like product we have seen it begin to increase again. a good way to see a reasonable real return years, as opposed to three or five years,
while your kids are young (newborn and arrange for the income to be paid to The main reasons for this shift are debt on investments. locking in value while looking for better
to age 20), allows values to accumulate their grandchild as an ongoing gift. The reduction from past spending, and our opportunities.
tax deferred so that eventually they can need to worry about being uninsurable or payment can be made on the grandchild’s aging population’s shift back to saving However, focusing too much on
be used to help them buy a home, start paying higher rates. birthday, or to mark another special again. This new trend is likely to continue bonds and income may not give us the These kinds of alternative strategies
their own business, or even supplement occasion. Life annuity or other annuity into the near future and change our opportunity for the higher growth and will be the key to investing in the new
their retirement. Buying life insurance You can pay over time, or in one lump like products produce very tax advantaged economic landscape. The “new normal” inflation protection we will need for the normal, a period that favors a more
or annuities for your young children also sum. income. will be a slower growth, low inflation medium and long term. dynamic approach to the market than a
guarantees that as your child matures, environment, based on steady and organic passive one.
marries, and has their own children, there An interesting estate planning idea, Whether you want to guarantee an estate growth. Higher government debt and low
will be protection for their families too. known as a “Cascading Insurance for your child or grandchild, provide interest rates eventually lead to higher Vancouver based, Van Arbor Asset Management
Program” provides grandparents the a financial gift, or employ an estate inflation that eats away at the real value Ltd. is a division of ZLC Private Investment
As the cost of life insurance is lowest opportunity to pass along money directly planning strategy, insurance solutions can of our investments. Bonds are the most Management and ZLC Financial Group. Van
at younger ages, you as the parent or to their grandchild. When grandparents provide significant benefits. susceptible as their real rate of return and Arbor’s core philosophy is to hold a focused
buy insurance on the grandchild and later portfolio of the best value based opportunities
grandparent can set up a significant value goes down as interest rates increase.
die, the grandchild then becomes owner in the market, rather than mirroring the
plan without compromising your Talk to your ZLC Associate to see if the This inflation risk is low at the moment, respective indices. This includes staying away
own financial security. These low costs of the policy, along with its cash value. gift of life insurance makes sense for your but the fuel for it going higher in the
The funds skip a generation and end up from weaker sectors, while focusing on the few
are guaranteed to never increase, and family. future is here today. selective opportunities that have excellent growth
regardless of what your child’s future may with the grandchild without any income
potential and are trading at bargain prices. A
hold (i.e. a future illness), they never tax consequences to the grandparent or The second risk is that we miss out focus on capital preservation alongside capital
on capital appreciation opportunities. appreciation is a cornerstone of their strategy.
Unfortunately, this is lower on people’s
Van Arbor Asset Management Ltd. offers
What Happens if I Die Without a Will? So, how do we invest in a slower moving minds, as our concern has been over
investors two unique active equity funds. The
economy? The key of course will depend capital preservation and not capital
Van Arbor Canadian Advantage Fund, the
Amazingly, thousands of Canadians die assets. If you also have one child, the first has increased substantially resulting in on inflation. Currently, as we shift to appreciation these last few years.
number one Canadian equity fund in Canada
$65,000 goes to your spouse, with the around 70% of all assets not passing to higher savings, the economy is seeing
each year without a valid will. over the last five year period; and the Van Arbor
a lumpy recovery, with some sectors Van Arbor’s solution to this has been to World Advantage Fund, one of the top ranked
balance then divided equally. If you have beneficiaries as they were intended.
recovering faster than others. Adding to focus on capital preservation during low global equity funds in Canada last year. (Source:
When this happens, the government does a spouse and several children, then the
that, we still have some excess capacity reward, higher risk periods like 2008, Globefund, as at August 1st, 2010).
not get your money, although without first $65,000 and one third of the balance Seeking the assistance of an estate lawyer
in the economy that is keeping inflation while looking for opportunities to grow
proper planning, they will get more than goes to your spouse, with the remainder is important, as is talking to your ZLC in check. This has allowed monetary and capital during high-reward, low risk Note: Van Arbor funds are offered through ZLC
their required share in fees and taxes, and then divided amongst your children. If Associate about estate planning tips to Private Investment Management.
your loved ones will experience delays, you have no spouse or children, your potentially reduce costs, delays, taxes,
extra costs and perhaps financial hardship parents will split your assets, or if they public disclosure and Wills Variation Making a Difference in the Community Don’t miss your opportunity!
and lasting family disputes. have predeceased you, then your siblings, claims. The GMWB 5% year end bonus
or failing them, your nieces and nephews Thanks to all our ZLC Foundation deadline is coming up soon.
Without a valid will, each province will will share equally. Charity Golf Tournament participants
impose its own guidelines on how your and guests who helped raise $40,000 for Don’t forget to make your Guaranteed
assets will be distributed. This can result And in BC, we are unique in that we Kids Up Front Vancouver. Minimum Withdrawal Balance
in your assets being distributed unfairly or also have the joy of something called the investment before December 31st to
to unintended beneficiaries. Wills Variation Act. This legislation allows Kids Up Front is a charitable get your 5% bonus for 2010. If you
the courts to redistribute your assets if it organization that provides children don’t have a Guaranteed Income
For example, in British Columbia if feels that you have not made adequate living with poverty, illness and other Pictured from left to right: Strategy yet, contact Lynn Newsome at
you have a spouse and no children, provision for your spouse or child in your challenging circumstances with access to Mark Zlotnik, Cindy Graves (Executive 604.688.7208 for the latest information
your spouse will receive 100% of your will. Because of this legislation, litigation arts, culture, sports, and recreation. Director Kids Up Front), Marty Zlotnik on our next information presentations.
Your team of experts
Peter G. Lamb Garry Zlotnik Martin Zlotnik Mark A. Zlotnik P.M (Pip) Steele Robert E. Olson H.G. (Howie)
b.a., clu, tep, f.c.a., b.comm., b.comm., ll.b c.a., clu b.comm., cfp, b.a. Young
epc, csa cfp, clu, ch.f.c. clu, ch.f.c. cfp
Carrie Lyle Amin E. Jamal John V.R. Wark Ross Gibson Ken McNaughton Lynn Newsome W.A. (Bill) Finlay
b.comm., mba, a.c.i.i., clu, tep b.comm., c.a, cfp, dip.t cfp, clu, ch.f.c., b.a., c.a.
cma, cim clu, ch.f.c. rhu, csa
Bruce K. Berger Michael A. Healey Heidi U. Pullem Matthew W.P. Aeronn Zlotnik Nancy Pereira Philip Levinson
b.a., cfp b.a., cfp, rhu cfp, cdfa Anthony b.a. gba c.a.
b.a., cfp
John McKeachie Peter Walmsley Trent Gurney Jack Shaffer Steven Kou Daryl King
epc csa cfp, clu, ch.f.c. b.comm., b.sc., cga b.sc., flmi
For more information, contact our Associates at:
Vancouver 1200 Park Place, 666 Burrard Street | Vancouver BC | V6C 2X8
Tel 604.688.7208 | Fax 604.688.7268 | Toll Free 1.800.663.1499
Victoria 3711 Grange Road | Victoria BC | V8Z 4S9
Tel: 250.727.3445 | Fax: 250.479.9716 | Toll Free 1.800.906.5666
www.zlc.net
Editor: Heidi U. Pullem, CFP, CDFA