Client Case Studies
Case One – Stressed Out Couple
Dominic and Esther are in their mid-to-late 30’s. He is a successful engineer and she is a well-paid marketing consultant with an I.T. company in Toronto. They have been married for 12 years and have three children, ages 10, 7, and 5. As a working couple with three young children, they barely have time to evaluate their finances. They have very ambitious goals but have never found the time to map out how they will attain them. They have debts spiraling out of control and only save haphazardly. They are considered high-income earners, which puts them in a higher tax bracket, adding to their financial obligations. They know that they need to start saving for retirement beyond saving for their personal goals but they are overwhelmed and don’t know how to start. They knew they needed help but they didn’t trust their bank for unbiased advice, they reached out to us.
Before helping the couple to identify how they could accomplish their financial goals, it was important to gain a clear understanding of how they were presently addressing it themselves. By walking them through our 360 Discovery Process, we were able to get a clear picture of their dynamic as a couple, their overall financial situation, and how they arrived there. The Discovery Process identified some key aspects that revealed how they could build on each other’s strengths to create working long-term solutions. Our comprehensive analysis helped them to understand:
- Their current cash flow, which revealed that they were spending 25% more than their monthly earnings
- The amount of taxes they were paying annually and how it was contributing to their cash crunch
- The interest payments on their debts and how that greatly impacted their long-term goals
- Their retirement shortfall and how to restructure their spending and saving patterns in order to catch up, get ahead, and exceed their identified goals
By using our Values Based Planning, we helped them to start working together cohesively as a team, and also developed a customized financial plan that:
- Reduced their monthly expenses by 35% while streamlining their financial affairs
- Implemented strategies to drastically reduce their income taxes, which further created a cash surplus to apply towards other goals
- Put them on a path to be debt free within two years aside from their mortgage
- Addressed their need to start saving for retirement and identified strategies that allowed them to double their contributions
- Showed them how to accelerate their retirement plan after eliminating debt
Our team continues to meet with Dominic and Esther regularly to track their progress. At our last meeting, they confirmed they have not strayed from the plan and are a year away from being debt free.
Case Two – Single Working Mom
Glenda is a working mother of two boys in her early 40s. As Nurse Practitioner, she earned a healthy salary that she was quite proud of. A few years ago, she met with a financial advisor in an attempt to make sure that she was on track financially. The advisor she met with convinced her to take out an investment loan to get a tax write-off. Glenda’s investment portfolio wasn’t doing well and due to the state of the market, she was incurring steep losses. Though she hadn’t spoken to him since the first meeting, which was nearly two years ago, Glenda reached out to the advisor and updated him on her portfolio’s status. Unconcerned with the downward trend of her investments, the advisor suggested that she take out an additional loan to potentially capitalize on investing more while the markets were down. Concerned with his advice, she sought out a second opinion for the investments, as well a rollover pension plan from a previous employer that she wasn’t sure what to do with.
It was apparent from our first meeting that she was really concerned about the current state of her portfolio. She was also under pressure to pay off the balance remaining from the investment loan. She wanted to make sure she could grow her investment account and have a solid plan for the future and that of her boys. After spending some time listening to her concerns, goals, and objectives using our 360 Discovery Process, it was clear that she was committed to building a successful, long-term plan. Our comprehensive analysis helped her to understand:
- The allocation of her investments
- The potential risks she was exposed to
- The underlying fees she was paying for the investments and how her advisor was compensated
- How quickly she could pay off the investment loan with a well-structured plan
- How she could transfer her locked-in pension from her previous employer into a customized well-structured portfolio
The Values Based Plan that was created for Glenda helped her to address all her concerns. In conjunction with our strategic partners, we were able to:
- Implement a better suited investment plan that considerably lowered the fees she was paying
- Reduce her exposure to certain risks inherent in her previous allocations, giving her more protection in the event of market downturns
- Transfer her pension plan
- Give her full transparency and regular reporting on her investment accounts
In addition to the above, Glenda has a comprehensive financial plan that outlines a clear roadmap for her family. She is also able to take advantage of government grants and tax credits that her previous advisor had overlooked. We continue to meet with her twice a year to review her overall financial plan, address any issues, and make changes as needed.
Case Three – Young Professional
Tony is a young professional who has worked his way up the corporate ladder over the last 11 years. He now earns a six-figure salary and for the first time in his life, he feels that he can really start planning for his future. Tony bought a condo in Richmond Hill a few years ago, and also has some small investments but “nothing substantial”. He would love to invest in more properties to generate additional income. He would also like to get a second master’s degree, get married within the next few years, and begin to travel. Unsure of how to accomplish all his goals, he began his search for a financial planner. We were one of the three financial planners he interviewed.
We could tell from our first meeting that Tony was a very bright and ambitious man. He had many dreams but less structure. During our first meeting, we performed an exercise that allowed him to get all of his thoughts down in writing, identify What Really Matters and prioritize his goals and objectives. This process also helped us to understand Tony better and how to design a financial plan for him that:
- Identified some of his weaknesses (including disorganization, misplacement of documents) and financial risks he was exposed to
- Addressed each of his goals and broke them down into measurable objectives
- Created attainable action plans and set timelines to achieve them
- Restructured and optimized his existing investments
- Addressed tax planning issues that were identified during the 360 Discovery Process which was costing him money annually
Tony’s Values Based Plan enabled him to purchase a second property within the first year of his signing on with us. His rental property brings him additional income that he is able to funnel into some of his other goals. Working with our strategic partners, we were able to structure the mortgages on both his properties in a tax-efficient and cost-saving manner. Tony was able to fund his second master’s program without taking on any additional debt. He has a retirement plan in place and is making major strides. We touch base with him quarterly to help him fine-tune his plan, solve issues as they arise, and keep him accountable.
Case Four – Medical Professional / Business Owner
Stanley is a busy Obstetrician/Gynecologist who, over the years, has accumulated sizable capital within his corporation. He is beginning to think about retirement and estimates that in another 15 years he would really like to slow things down. He would also like to move some money out of his corporation to fund some personal projects that he is passionate about, however he is worried about the tax implications.
It was important for us to ensure that we understood his corporate structure and what he was trying to achieve. This allowed us to visualize how any decisions made would affect him and his ability to achieve his financial goals and priorities. We worked with his tax professional to outline different “what-if” scenarios and potential outcomes. Together we designed solutions that:
- Allowed him to withdraw assets from his corporation tax-free
- Took advantage of corporate asset-transfer strategies that allows a tax-free transfer of his assets from his corporation to his beneficiaries upon death
- Addressed his retirement planning needs to ensure his retirement is well-funded
Working with his CPA, we were able to mitigate the tax consequences for taking funds out of his corporation. The solutions we implemented helped to protect his savings while creating an income stream that will continue to fund his personal projects. He is well on his way to a well-funded retirement and we continue to meet with him regularly to ensure he stays on course.
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