Tim Paziuk’s Blog

Does Your Financial Plan Make Any Sense to You?

November 19th, 2013

Is your financial plan just a bunch of numbers crunched to the point of no return?

I often wonder if the general public has any idea about what really goes on within the financial services industry. When they take the step towards planning for their financial objectives, are they receiving the best advice available or simply the most available advice?

Case in point: A Canadian financial publication came out this month claiming almost 82 per cent of financial planners create financial plans for their clients, yet only 51.5 per cent of these clients have a financial plan.

Indeed, these two figures are confusing — if advisors are creating all these plans, why does it appear that 30 per cent of the clients they […]

A New Perspective on the Unemployment Rate

September 17th, 2013

Is a 7 per cent unemployment rate acceptable? According to some — absolutely! As a matter of fact, quarterly unemployment never fell below 7% throughout the 1980s & 1990s.

The unemployment rate in July increased to 7.2% from 7.1% in June. This reflected a net job loss of 39,000 jobs across Canada. Now that may seem like a big number but apparently, it’s not that bad. If we were to calculate Canada’s unemployment rate the same way that the United States does, our unemployment rate would probably be closer to 6.2%.

If you looked at unemployment the way the US does, we would be in pretty good shape, especially if you believe in the natural unemployment rate. If you don’t know what the natural […]

Where is Your Charity Money Really Being Spent?

August 30th, 2013

Do you ever wonder what happens to the money you donate to charity? Have you ever taken the time to find out?

People give to charity for various reasons, but I think most people give because they believe it’s going to help the people or animals that the charity represents. Usually this is the case, but all too often there are unknown benefactors of your generosity.

I finally got around to reading through the summer edition of MoneySense magazine. I was pleased to come across an article titled “Hearts & Minds” written by Mark Brown. WhatMoneySense did was send out a questionnaire to charities across Canada to come up with The Charity 100. To quote from the article, “The Charity 100 is a scorecard of the largest […]

When it Comes to Your Mortgage, Every Day Is Opposite Day

August 16th, 2013

Have you noticed over the last few months that the banks have really been pushing variable (floating) rate mortgages? The banks are basing this on historical information, which in my opinion is irrelevant today.

It is true that, overall, interest rates have been on a downward trend over the last two decades. There have been a few increases (like 1995), but basically the rates have come down from about 12 per cent in 1990 to a low of 0.91 per cent in 2010 (these rates are based on the average yield of 6 month treasury bills).

But it wasn’t too long ago that banks were recommending locked in mortgages because they told us rates could be going up. What happened, of course, […]

How the Government Sneakily Pockets Your Pension

August 16th, 2013

I read an article the other day that brought up a problem that sadly, happens more than we think; dying before you collect Canada Pension Plan (CPP) retirement benefits.

Although there were a couple of factual mistakes, the message was clear and correct — a lot of people contribute a lot of money into CPP and never receive an income payment.

If you happen to contribute the maximum amount for 35 years and then die before you start to collect, the loss to your heirs would be about $475,000 (assuming five per cent annual growth). Is this fair? I don’t think so.

Some people may think that it is fair because that’s the way pension plans work. If you die, the pension dies with you. That’s true, […]

A Question For You About Drugs

July 16th, 2013

Usually people respond with positive or negative comments to my blogs each week. This one is different. I’m looking for your opinion on where health care should fall between capitalism and the public good.

I work with hundreds of physicians in regards to their finances and we often discuss what’s going on in the medical community. One recent conversation left me feeling confused about our free enterprise system. After thinking about it for a few days I thought I’d get your opinion on something that happens in the pharmaceutical industry that few people know about.

A pharmaceutical company will spend a lot of money on research to find new drugs. When they have something they know they can market, they get it […]

Seven Things to Know About Investing

July 2nd, 2013

There is a raging debate on how financial advisors are compensated for financial products, particularly how they receive commissions hidden in mutual fund fees. Advocis president and CEO Greg Pollock recently published a piece in the Financial Post against the idea of banning commissions, and the debate was then taken up by both the Globe and MailandBNN, where Pollock appeared as a guest.

While mutual funds are what I like to describe as “Weapons of Mass Financial Destruction” let’s take a look at mutual fund’s evil cousin, the “exempt market security” and how they are awarding this investment opportunity to only accredited investors.

Do you know what an “accredited” investor is?

If you believe the investment community and their regulators, an accredited investor is someone who […]

Not Just Parliament with Ethics Issues, Watch Your Lawyer

June 20th, 2013

Canadian news is mired in ethical debates these days, from questions over government officials’ rising salaries, to charity speaking fees, travel expenses, and even substance abuse. What’s the common thread in all this? Lots and lots of lawyers’ fees!

These lawyers no doubt have their work cut out for them. But let’s take a look at the lawyers working for the average person and their financial interests. It seems like I’m faced with legal documents a hundred times a year that are poorly prepared or just plain wrong. Those lawyers also have a moral obligation, not to their constituencies, but to their clients.

Case in point:

A recommendation was made to a client to add a spousal trust to his will. He called […]

What You Really Need to Worry About When You Invest

June 10th, 2013

As Stephen Poloz begins his tenure as the new governor at the Bank of Canada, there has been a lot of talk about Mark Carney’s last policy decision to hold the interest rate steady at one percent. While the rate addresses the expectation of moderate growth in the Canadian economy, it also forms the basis of the saving and lending rates that banks pass on to their customers.

With rates not expected to move anywhere, any time soon, the question is: “How can the average Canadian make any money from their investments?”

To answer that, let’s take a look at how people think of ‘risk’ and ‘investing’.

I come across a lot people who have been taught to equate the idea of ‘risk’ with losing […]

Canada’s Trillion-Dollar Generation

May 24th, 2013

Are you ready for the $1 trillion giveaway?

It’s been estimated that baby boomers in Canada stand to inherit as much as $1 trillion over the next twenty years. So the question is: are you ready?

According to studies, as many as 70 per cent of individuals who come into a lump sum of money (regardless of the amount) lose that money within the first few years.

I always tell people, “Saving is a habit, investing is a discipline.” Unfortunately, many people have neither the habit nor the discipline to handle money, especially large amounts.

If you are the one giving the money away, you should consider each recipient. Are they really capable of handling the responsibility of the inheritance? Is it going to […]

Page 3 of 712345...Last »