Boost Your Investment Contract Legitimacy in Canada with Online Signatures

How to eSign a document: online signature legitimateness for Investment Contract in Canada

are you wondering how to navigate the world of investing in Canada in 2023 whether you're a seasoned investor or just starting out this guide is a must watch for anyone looking to succeed in the Canadian investment Market in 2023. so let's start with the types of investment accounts in Canada now there's a lot of investment accounts in Canada but there's a few main key ones that I want to Zone in on today and most of these will apply to all of you watching this video the very first investment account that most of you will have is an rrsp and an rrsp is a tax deductible account meaning that when you invest money into an rrsp you get a tax deduction on your contributions later in retirement when you go to pull out that money that will be taxable income to you now the RSP can be used in between if you have an emergency you can pull it out but anytime you pull money out of your rrsp you're going to be taxed on that income the best way to use an rrsp is to put money into it while you're in a high tax bracket while you haven't employment income or other income and you pull the money out when you're in a lower tax bracket in retirement so not only do you get a tax break on the higher tax rate but your money grows tax deferred until retirement when you pull it out if you've lived in Canton for any amount of time and you've had employment income or other types of income you've likely used and started to build up an rrsp and if you haven't I encourage you to do so the second most common account in Canada is your tax free savings account the tfsa now again it's a tax free savings account I would say it should be called the tax free investing account it's an account where there's not a tax deduction when you put money in it's after tax money that you're putting in there but everything grows tax-free and can be pulled out tax-free down the road whenever you need that money it's a very powerful investment account it's a great tool to have as you head into retirement to create flexibility to create kind of that laddered income to create more income for you without driving up your taxable income a lot of you have built it like a savings account you're saving at you know one two three percent you should be utilizing that tfsa account more as an investing account so if you haven't kind of wrapped your head around that we have a few videos on our channel on that how to use it efficiently to grow it and make it work best for you the third most common account is your non-registered investment account and this is likely you've maxed out your rrsp you've maxed out your tfsa and you still have extra money to save maybe you received an inheritance or a big lump sum seven something like that and you have that extra money to contribute to an investment but you have no contribution room that's where you use a non-registered account now this could be an individual account or it could be a joint account with your spouse or common law partner money that you put into these accounts are not tax deductible it's after tax money going in and anything that you earn in that account whether it's interest income uh capital gains or dividends all of that is taxed in the year that it's triggered so you want to be aware of how you invest that account and we've have other videos on this but when you have an rrsp A tfsa and A non-registered account you want to make sure you're structuring your Investment Portfolio correctly so that you pay the least amount of tax possible the fourth most common account in Canada would be your resp account and this is for anyone that has kids or grandkids and this is the type of account that it used to save up for a child's education any contribution into the resp is after tax money but you can get a grant up to 20 for low-income families it can be up to 40 percent of your contribution you can learn more about resp online we also again will link some videos to that up above as well but the resp is a great tool if you have kids or grandkids and you want to help them save for post-secondary Education the reason being is that 20 Grant is like a 20 rate of return right off the top so myself I max out my resp for my kids every single year to take advantage of that Grant it's free money it's a 20 return and then I take my contribution and that 20 Grant and invest it in a good solid portfolio to help grow long term to provide money for my kids when they go to post-secondary education so it's a way to save now to build it up tax deferred and the money that grows in the grants down the road is going to be taxed in their hands at ideally a lower tax rate so the resp is a very powerful tool if you have kids or grandkids make sure you have that open and are utilizing that the fifth most common account in Canada would be your registered disability savings planner rdsp now a lot of you aren't going to qualify for this but if you qualify for the disability tax credit this might be an account that you also qualify by default there's a lot of rules and fine print and all that with the rdsp but if you qualify for the tax credit the disability tax credit you want to look at the rdsp as well it's a great savings tool there's a lot of Grants and bonds that are available to you especially for lower to mid-income families there's a lot of free money to get into the plan and help you build that up so it's a great option for you if you qualify and fall within the parameters so those are the five types of accounts or at least the most common types of account now there's a lot more there's you know a lira and then when you convert it to you know a lift your RSP goes to a riff there's a lot of different types of accounts a lot of you have defined benefit pension plans to find contribution plans profit sharing plans RCA accounts there's a multitude of accounts out there but for the majority of you those are the five major ones your three major ones are the rrsp tfsa and non-registered accounts now if you have another account that maybe it's an RCA account or a lira account or something else the investment types that I'm going to talk about right now would qualify for those as well again I talked about the five main ones you may have one of the other smaller types of accounts but the investing options that I'm going to go through now we're qualify for any of those types of accounts as well so there are several ways to invest in Canada and this doesn't you know qualify just Canada it's across the world there's different types of Investments now where I talk about the types of account the rrsp the tfsa the non-reg the rdsp the resp those are types of accounts now think of those as umbrellas and under those umbrellas you can have different types of Investments now you could have the same investment in each different category like your rrsp your tfsa and your non-registered investment could have the exact same investment within those accounts now that's probably not the most tax efficient when we start breaking it down but in theory it could so the first type of investment we're going to talk about is stocks and stocks is when you own a share or percentage of a publicly traded company it could also be from a private company but for most of you buying stocks on the open market it's going to be from a public company so you might own shares of let's say Tesla within again and your rrsp your TFC and your non-reg or other accounts Tesla if you own Tesla shares there's a price you pay it could go up or down every day currently Tesla does not pay dividends but that would be a example of a type of company that you could own again Apple Amazon alphabet there are many types of companies out there there's thousands and thousands that you can choose from whether they're good Investments or not that's up to you to do your due diligence on but a stock is a type of investment that you can own under one of these investment umbrellas or investment account types the second way to invest in Canada and this is probably the most common way that people get into investing is through mutual funds and mutual funds are most common through your bank or large financial institution and what a mutual fund does is it pools a bunch of stocks and a bunch of bonds together in one now mutual funds have become more complex and they might own more than uh stocks or bonds they might have alternative assets and real estate and other things within them but for the most part most mutual funds will own a percentage of stocks and a percentage of bonds now it might be 50 50 in a balanced fund it might be more Equity or more bonds depending on the risk and the type of structure but a mutual fund is essentially you buy one mutual fund so you might buy a mutual fund ABC and within mutual fund ABC you're going to own a bunch of stocks and a bunch of bonds now every mutual fund is structured a little bit differently but you're essentially buying one investment type and they're going to own a bunch of Investments within that so it simplifies it right it's a way to invest a little bit of money and diversify that across a bunch of different investment options you don't have to decide what stock or bond to buy you have to decide which mutual fund to buy and within that mutual fund there's a portfolio manager that will decide what the best investments are that they believe is to invest within that mutual fund now again there are many mutual fund one in Canada and across the world so do your due diligence there's thousands and thousands of mutual funding each one will focus on something different things you want to pay attention to are how many Holdings are in that mutual fund like how many stocks sometimes I come across mutual funds that have thousands of stocks and thousands of bonds like you own basically everything some of them are more focused where you own 25 or 30 stocks and a handful of bonds it's more focused and zoned in on what it's trying to do the other thing you want to focus on is fees like what kind of fees sometimes mutual funds carry very high fees two to three percent and that can start to erode away at your overall investment return again you're going to pay something for that advice and for the investment planning but how much are you paying and how much are you willing to pay the third way to invest in Canada and across the world would be with an ETF and an ETF is probably the most popular fastest growing type of investment out there right now and that's because it's much like a mutual fund which most of you invested in most of your life but it's a lower cost and so we're a mutual fund has a bit of a higher cost and ETF and exchange traded fund typically has a lower cost to it and it typically will track an index so if you buy an ETF that tracks let's say the S P 500 it's going to do exactly what the S P 500 does now the world of ETFs has evolved a lot over the last couple years and that it used to be just the main indexes that you could buy and kind of track now you can buy you know an ETF that tracks the vegan food companies and the you know the transport companies and it's very specific so there are a lot again thousands of options in the ETF world but an ETF is basically a pool of stocks of companies that qualify under that ETF Banner so again focus on what does that ETF look to invest in and then they'll have companies within that space that they hold in that ETF now again one of the drawbacks with ETFs is it does have a cost to it now it's typically quite a small cost but if you think about it this way if you buy an ETF that tracks S P 500 and it has you know even a 0.1 percent cost so 10 basis point costs that means you're always going to perform what the S P 500 does minus a little bit so you're always underperforming the market now the last three ways to invest and again there's more ways to invest here but these are the mainstream most common ways that we see people invest in Canada and the US and across the world the next one will be real estate whether that's through a real estate trust you know a group of real estate or you're buying individual real estate it's hard to buy at least in Canada individual real estate within your rrsp there's a lot of parameters but that's where REITs real estate investment trusts have become popular in that you can own you know commercial residential industrial real estate within a portfolio within your RS period tfsa account bonds are another very popular way to invest again typically a lot of you will own bonds within your mutual funds remain maybe a balanced type ETF bonds are typically structured in a way where you're lending money to a government it could be federal or provincial government or a company and you're lending money to them and they're going to give you an interest rate back and that could be a payment annually or semi-annually some of them are even monthly and so let's say you buy a bond with the federal government and it pays you three percent you're lending money to the federal government they're going to pay you three percent annually and if it's a five-year bond that means they're going to pay you three percent for five years and after five years you're going to get all your money back same if you do with companies now obviously the higher risk the company the higher interest rate that's going to be because there could be risk of a default now bonds have really hurt portfolios lately as interest rates rise as we've seen bond prices fall and so a lot of you have been hurt badly within your investment portfolios because the bond piece of your portfolio has dropped as well as the equity or the stock portion has dropped as well typically and historically bonds have been kind of the foundation of your portfolio that buffered the equity bumps well as we went through 2022 bonds didn't protect you in fact a lot of you have lost double digits within your bonds so be very aware of what type of bonds you own how they work how they performed because it could be a big drag on your portfolio both in the past and moving forward the final way I want to talk about how Canadians are investing is alternative assets and we did a video last week with Luke from BCB about their alternative pool that they're launching now if we look at how Pension funds are structured we will see that a lot of a pension fund 20 30 40 percent will be in alternative assets in real estate mortgages and private debt private Equity a lot of stuff that you and I aren't typically investing in and I think this is a space that we have to open our mind to open the option to now one of the problems has been up until now if you want wanted to invest in alternative assets it was typically a minimum of 50 100 500 000 per investment so if you wanted to diversify it became very challenging and that's where I like the pool that BCB has put together I will be personally investing in it a lot of our clients will be investing in it as well and encourage you to check it out it's going to be a cool type investment and it'll be a piece of our client's portfolio so for myself I will have probably about 15 to 30 percent of my portfolio in the alternative asset pool and then that's Diversified within that so it's a great option if you're looking to get outside of the traditional markets outside of the traditional Bond and have something a little bit different and I wanted to bring Chris Richard on from BCB and just talk about how the alternative Pool Works but also talk about cash flow and as you get close to retirement like how do you manage that cash flow how do you manage kind of recessions and bumps in the road and Market Corrections and all these things that that we've seen over the last year and we will see again and again as we move forward how do we kind of create that road a bit smoother as we head into retirement as we look for more consistent cash flow so let's welcome Chris to the channel and talk a little bit about that so Chris thanks so much for joining us today uh again I wanted to bring you on just talk about kind of cash flow and portfolio build and what you guys are doing at BCB to help help our clients help your clients with this protest whenever we kind of talk to clients and they ask me about what we're doing and what type of portfolio we're building honest to goodness like we are executing a financial plan or a plan in order to take an individual from this point over here to a different part in the future majority of people it's going to be just about I've started retirement and I want to make sure that my portfolio lasts as long as possible and generates the returns and cash flow that I need so some people kind of confuse the two like I have to get X number of a return we focus in on it's not just the share price or the bond price going up right so it's all about the total return a big piece of that can be a cash flow generated from a dividend from a stock interest from a bond or from the New Alternatives pool that we're going to be launching right just kind of castle out of that so having different streams of cash flow that that way you don't always have to have the share price do the heavy lifting of generating that return I would don't want to ruin it for everybody but it's not always going to be sunny out there right sometimes we're going to have share prices roll off agree disagree it's kind of what you transact at the time so if you have a portfolio that generates a significant amount of cash flow you're you know that can generate most probably not all but most of your cash flow needs for your retirement you're already like two-thirds of the way there right but having that plan in order to say what level of risk do I need to take in order to get from A to B what level uh and then that what that does is that kind of structures the types of portfolio construction that we put together for different individual clients and that's one of the reasons why you guys have kind of built out this alternative pool which again you guys have spent years kind of researching building up and and we're finally at the point where it's launching which is great for our clients but again a big piece of that is kind of consistent cash flow that's maybe not tighter as tight to the traditional stock markets right I mean like if you kind of look at the share prices in 2022 we've had a you know a lot of places have had a down year although sometimes in cash flow in different companies cash flows are safe relatively flat but the everyday price on stocks tends to Value just be like a voting machine as you know Warren Buffett often says so at that point you might be having to sell units at a depressed price if you need to get you know some extra cash from your portfolio so the alternative pool is really there to just be somewhat of a cash flow just generate cash flow right we're not looking for huge net asset value growth we're looking for you know we're aiming for between seven and nine percent uh cash flow which I think is you know fairly you know conservative could could people get more than that for sure but really when we've been looking at the market you know we've been around you know for all you know about 16 years now right and one thing that a lot of individuals told us hey you know this is great that you guys want to you know offer an alternative solution don't screw it up right and and for us that's why you know we hired Luke Luke has got uh this is kind of hit he's the head of Alternatives here so it's not like it's a side of the desk project we really are focusing in on partnering with really good businesses that just happen to be private that look to generate a significant you know cash flow that we want to participate with but it's just another you know arrow in your quiver within your Investment Portfolio sometimes stocks are doing well so you'll use those as maybe a source of income sometimes bonds will outperform the cash flow always continues to generate there so when it's not always sunny you always at least have that Baseline of having cash flow coming into your portfolio absolutely and like we talked about with Lucas it's more of that pension style of investing like you're having this alternative pool kind of more aligned with that type of pension investment and a lot of people don't have the fine benefit plans anymore and it's like well how do I create that pension well you can't but you can start investing in maybe a bit more like a pension plan to create that consistent a cash flow so um prints are all about cash flow like if you kind of look underneath the surface like they're really worried about the amount of cash that keeps coming in and now can you always guarantee uh like I said like that you're always going to have positive Returns on stock price appreciation no but they need that cash flow you're right I mean probably like one in ten new clients that we have coming through the door now have a defined benefit plan majority of individuals this is their life savings right they've had an economic event or they've just happened to save and they are tired of working and the idea of you know people used to retire at 65 average life expectancy was 70 72 right the pen the portfolio didn't need to last more than you know seven eight years now people are retiring at 60 and you know passing away 90.95 so this is no longer a seven year Investment Portfolio this is now a 30 35 year Investment Portfolio now can you always predict that you're gonna the path is gonna be can you predict picked out 30 years worth of path I mean you can't right but owning high quality businesses you know conservative Investments That generate significant amount of cash flow that is growing at the same time for us that's a winning winning recipe well Chris thanks so much for joining us today um if you want more information on BCB Asset Management we'll put their link below and if you're looking for a different investment alternative to what you're currently doing and would like to line up a call with Chris and his team happy to do that we'll put our information below reach out to us and we'll line up that call for you so thanks again Chris for joining us thanks