Their homes provide financial muscle. 

A typical mortgage comes with a fixed or variable interest rate and a predetermined schedule of payments.  Some have features that permit an accelerated payment plan.  Most also come with penalties and if you deviate from the terms, the penalty can be steep.

Reverse mortgages let you borrow against the equity in your home.  It many cases it is possible to borrow 40% - 80% of your home’s equity.  The equity in your home can be a source of tax free cash.  Money can be used for almost any activity, for example: home renovations, investing, to pay for a holiday, to pay down other (higher interest rate) debt, or maybe to fund your child or grandchild’s education.  The options are endless.  But accessing your home’s equity can be daunting. 

Not all mortgages are created equal. 

Ø       Some mortgages come with the freedom to access home equity without calling the bank. 

Ø       Some mortgages allow you to pay down debt as quickly as you like (without penalty).

Ø       Some mortgages let you apply all your free cash against your debt, but still let you access cash as you need it (even to pay for groceries or fill up the car). 

If your mortgage doesn’t work like this, maybe it is time to start asking why. If you want more freedom in the way you bank, want to pay less interest, and want access to home equity (without a hassle), you owe it to yourself to look around.  Investorcare is not a mortgage broker, but we may be able to help you.  Give us a call:  943-2273.

If you have a mortgage on your home, chances are good you also have mortgage insurance. The idea is that if you should become seriously ill or die before paying off the mortgage, the coverage will kick in and pay it off for you. It’s meant to offer peace of mind and to reassure you that your family will be able to stay in your home if anything should happen to you. The reality falls a little short of that.¹

To find out more and see CBC’s Market Place VIDEO documentary, click the following link:  

IN DENIAL: The Mortgage Insurance Game

1.  CBC.ca. IN DENIAL, February 6, 2008:  http://www.cbc.ca/marketplace/in_denial/

Segregated fund contracts provide exposure to a broad selection of investment options such as equities, bonds and money market funds. They also feature a selection of guarantees that can help to protect your investment during volatile markets.

Segregated fund contracts generally assure that either 75 per cent or 100 per cent of the value of your principal investment will be guaranteed at death or after a specific period of time. Some segregated funds allow you to “reset” the value of your contract to a higher amount and capture any growth experienced by the underlying investment. For example, if your segregated fund portfolio grew by 10 per cent over a certain time period, a reset could occur to lock in that higher value, which becomes the new value upon which the guarantees are based.

Since segregated fund contracts are insurance products they can also provide additional benefits such as potential protection from creditors and the ability to bypass probate (assuming that there is a named beneficiary). Other benefits of segregated funds may include access to your capital should the need arise. However, withdrawals will affect the guarantee features associated with segregated fund contracts.

Insurance planning to-do list

1.	If you’re unsure of how much life insurance you need, talk to an insurance advisor who can help you with the calculations.
2.	Find out what insurance benefits your employer offers before you go out and buy additional insurance. Also, compare the cost of the insurance from your employer to what you can purchase externally.
3.	Make sure you have adequate disability insurance coverage, especially if you’re self-employed.
4.	You may want to buy more disability insurance coverage than what your employer’s plan offers – be sure to examine the policy for cost of living adjustment and other features.
5.	When you buy a house, consider purchasing term insurance to cover the value of the mortgage instead of specific mortgage insurance.
6.	Periodically re-examine the beneficiaries you’ve named on any existing life insurance policies to see whether or not a change is in order.
7.	Protect your home and car with adequate insurance coverage, but remember you also need to protect your lifestyle and assets – for yourself and any dependents – with other products that may also be appropriate for you, such as disability, life or critical illness insurance.
8.	If you have a significant life event such as purchasing a home or having a baby, make sure you re-evaluate your life insurance needs.
9.	When you buy an insurance product, carefully review its additional or optional features that may add value to the product, such as return of premium or inflation protection, and familiarize yourself with any riders.

]]> http://investorcare.ca/blogtalk/2009/02/14/insurance-planning/feed/ http://investorcare.ca/blogtalk/2009/02/14/resps/ http://investorcare.ca/blogtalk/2009/02/14/resps/#comments Sat, 14 Feb 2009 21:12:27 +0000 iGuy http://investorcare.ca/blogtalk/?p=5 Beginning in 2008, the government has enhanced the flexibility of RESPs by extending the contribution period from 21 to 31 years and raising the maximum time that an RESP may remain open from 25 to 35 years. Corresponding changes to individual RESPs for beneficiaries who are eligible for the Disability Tax Credit extend the contribution period from 25 to 35 years and the maximum time that an RESP may remain open from 30 to 40 years.

There is also more flexibility for beneficiaries to access their RESP savings. Beneficiaries who cease to be enrolled in a qualifying post-secondary program after 2007 are eligible to receive education assistance payments (EAPs) for up to six months after they leave the program.