The ABC’s of RESPs

ABCs of RESPs

An “RESP” (a Registered Education Savings Plan) is similar to an RRSP in that it uses “registered” savings to tax-defer the growth in the plan. An RESP is often used to save for a child’s post-secondary education, but can be used for anyone planning to attend a qualifying program.

For children’s RESPs, the government also contributes between 20-40% (to a maximum) through the Canada Education Savings Grant (CESG). As with the RRSP, the earlier you open an RESP, the longer your savings have to grow.

While it’s not crucial that you use an RESP to save for education costs, it is important to plan how and who will be covering the cost. As we all know, the cost of a post-secondary degree is climbing and, with inflation, it’s a whopping big number. The Globe and Mail points out a few things to keep in mind about RESPs and if you’re in BC, don’t miss out on the age 6 BC Training & Education Savings Grant (BCTESG) of $1,200. 

There are a number of questions to ask, before opening an RESP (here is a short list):

  1. Are there any fees (account opening, annually, transfers out, closing the account, etc.)?
  2. What are the investment choices available?
  3. What happens if the child does not attend a qualifying program?

For more information, visit:
Government of Canada Guide to RESPs  

How Does Health Insurance Work?

If you are self-employed or your employer doesn’t offer benefits, you might be stuck paying for your own health costs. In Canada, we are fortunate to have a Pharmacare, but it does not pay for all health expenses. That’s where personal health insurance comes in.

What does it cover?

Health Insurance covers a variety of different expenses, depending on the plan you choose. Generally, they cover a percentage of:

  1. The cost of prescriptions after Pharmacare’s benefit
  2. Basic dental costs like X-rays, cleanings, and fillings
  3. Eye exams and glasses
  4. Certain professional or registered services like massage and chiropractic
  5. Selected medical supplies

Each of these categories will pay a maximum amount of money each year. For example, your prescription drug coverage might cap out at $1,000 per year.

Many plans will also have travel insurance built-in, coverage for hearing aids, and other, smaller benefits. So be sure to shop around!

What does it cost?

These plans vary quite a bit in cost. However, dental coverage is usually what makes one plan more expensive than another. Plans that offer less dental coverage or none at all are typically more affordable.

A plan with all of the coverages listed above and more would cost an individual ~$80/month. With the option to have coverage for the whole family for a higher, set price.

What type of health questions do they ask?

While much less invasive than life or disability insurance, a health insurance application will still ask a number of questions. Including but not limited to:

  1. Whether anyone going on the plan is on medications or receiving treatment currently, like regular massage therapy
  2. If you’ve just left or are about to leave a group plan (this may give you more options)
  3. About any health conditions you have experienced in the last number of months or years, depending on the Insurer

The Insurance Company will want to know when symptoms started, what the cause was, if there was a resolution, and about prescriptions.

What if I already take medications or receive treatment for pain?

Medications you already take will be considered a pre-existing condition and typically so will treatment you are already receiving.

Insurance Companies will not usually cover pre-existing conditions and specify in your policy what, if any, the exclusions are.

The exception is with a non-medically underwritten policy.

In these policies, the Insurer does not ask questions about your health nor do they exclude pre-existing conditions. The trade-off for this extra coverage is typically less coverage for more money.

How do I buy it?

You can buy health insurance from an Insurance Advisor or Broker, select companies have applications on their website, or you can call the Insurance company and have one of their agents sign you up.

We will always recommend that you work with a Broker as they can show you options from multiple companies, getting you the best fit for no extra cost.

At Iron & Pearl Financial, we can offer coverage through four different Canadian carriers. Get Started Here.

Your Holiday Budget Guide

Did you know that 42% of Canadians don’t have a budget for the Holidays? A CPA Canada study says that most of us PLAN to spend less but only about half will budget. And 1 in 5 admit they’re gonna blow whatever budget they didn’t create. In response, we’ve created Your Holiday Budget Guide!

Use this guide to plan your Holiday budget and check out our Take the Mystery out of Your Money worksheet for the New Year!

Holidays are busy and budgeting isn’t fun. But, and especially if lowering stress and self-care is going to be a New Year’s Resolution, it’s a necessity!

What can you do about it? Well, we’re glad you asked!

When it comes to budgeting, making a plan is the best route! There are 10 tips in your Holiday Budget Guide. You’ll find a few of them have helpful links – be sure to click on those!

Grab your freebie below!

1. Think back to last year:

How much did you spend? Did it seem worth it?

2. Pick a number: 

BEFORE you get to the store, decide how much you’ll spend on each person, and keep track of that number.

3. Shop for deals: 

We all have a little computer stashed in our pocket (your smartphone!). Before you hand your card over, do a quick search online and see if another store has a sale on that item.

4. Send an e-card:

If you like to send a Holiday card each year, why not send an e-card? It’s MUCH cheaper (FREE most often) and so much better for the environment.

5. Know why you’re giving the gift: 

Think of that one person (or group of people) that you “have to buy a gift for.” Just in case you need it, here’s your permission to NOT buy them anything. It doesn’t make you cheap or a scrooge. You’re not obliged to buy presents! That’s an idea that’s been sold to you.

6. How many leftovers do you want?:

In our family, we joke about ‘pawning off’ the leftovers so the cook doesn’t have to eat half a turkey 😆 But think about how silly that is! If you find you have a tonne of leftovers each year, try cooking a little less. Now that’s a win-win! Another option is that, after dinner, you bring a warm dinner and a fork downtown for a homeless neighbour.

7. Pick a name: 

For the last few years, our family has been drawing names using this program. (not an affiliate link) It’s made Christmas so much easier! We each pick one name and have a spending limit. It’s really helped our budget and we all leave with things we actually wanted; no ‘filler presents’.

8. Try a more needs-based approach to buying for kids:

One thing they want, one thing they need, one thing to wear, one thing to readand one thing for the family.

9. Limit your decor: 

I have a deal with myself to not get more than the 1 bin I have for Holiday decorations (not including the tree). Now, that might be unrealistic for you, especially if you have kids. Maybe it’s 3 or 4 bins. Whatever it is, limit yourself to what fits in the space you’ve allowed. Remember, you’re paying for those items, the bin, AND the storage space they’re in – think storage lockers and extra sqft in your home. If you find a piece you LOVE, something else has to go!

10. Don’t be afraid of change: 

I’m a huge fan of traditions. Especially Holiday traditions! But if they’re not serving you anymore, consider making a change. For example, if you always open a few presents on Christmas Eve (which means you have to buy ‘enough’ for Christmas Day too), try switching it up! A family game and a movie might be even more memorable.

I hope these Holiday budget tips come in handy this season! 

Remember, when the lights are taken down, the credit card still has to be paid! It’s worth planning a little now to save yourself from money stress in the New Year.

Download Link: Your Holiday Budget Guide

P.S. Interested in ‘conscious consumerism”?  Check out this video on social responsibility. 

Would this blog have been helpful to find just a few weeks before the Holidays? Sign up for our newsletter to get helpful tools like this right when you need them!

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Preparing for a Financial Review

financial review

Preparing for a financial review can easily turn into a case of information overload. Your financial life likely has a lot of moving parts and your task is to figure out where they all are.

To make sure your meeting is as productive as possible, start a list of the information you should have.

Watch the video for a full explanation or continue reading for the summary.

When you sit down with a Financial Planner or Money Coach, their goal is to get as much information about your finances as they can.

In order to do that, they’ll need information about all of your financial commitments, your budget, and your goals.

If you think of any concerns or questions as you are getting this paperwork together, be sure to write them down so they can be discussed with your Advisor.

Use the list below to make your first meeting as productive as possible!

The 6 pieces of information you should have before a financial review:

  1. Tax Documents
  2. Investment, RRSP, and Pension
  3. Debts and Loans
  4. Insurance & Will
  5. Short & Long Term Goals
  6. Income
    • Track your expenses:
      • Rent/mortgage
      • Property taxes/strata fees (if applicable), home/contents insurance
      • Utilities (phone, internet, heat, hydro, etc.)
      • Charitable donations
      • Food (groceries + eating out)
      • Entertainment (booze, movies, coffee breaks, clubs, shows, etc.)Insurance payments (ICBC, MSP, etc.)
      • Loan payments (student loans, car loans, line of credit, etc.)
      • Clothes/make-up, dry cleaning, personal items, glasses/contact lenses, etc.
      • Gifts (birthday, baby shower, wedding)
      • Travel (vacation, holiday, ski trip, festival, etc.)
      • Pets
      • Children (RESPs, school, activities, etc.)

Knowing or having the documentation for 6 topics above should cover everything that your Advisor needs to know.

However, as everyone is different, this isn’t an exhaustive list.

Working with the right Financial Advisor can make all the difference when creating the right plan for you. 

Our Certified Financial Planner®, Alyx, and our Money Coach, Jen, would be happy to help you create a plan that works for your lifestyle and goals.

Happy planning!

How Much Does A Financial Planning Professional® Spend On Her Wedding?

how much does a financial planner spend on her wedding?

Here’s the post and answer many of you have waited for – how much does a Financial Planning Professional® who encourages frugality spend on her wedding?

My husband and I have been married for 8 years now and a frugal wedding has afforded us a number of opportunities we may not have had otherwise. A beautiful home and two awesome kiddos, to start!

I’ll sheepishly say, we spent more than I thought we would. But I wouldn’t change a thing.

As you can imagine, a lot of planning went into this wedding even though it was PLANNED IN 3 WEEKS! This is what we did to stay frugal.

  1.  We had many discussions about our budget (surprise! surprise!) because we knew we didn’t want to go into debt
  2. We gave ourselves less time to plan so that we were limited in what we could do
  3. We went for NICE not extravagant 
  4. We got married during the week
  5. We kept it small – about 24 guests
  6. We picked one thing to splurge on
  7. We accepted as much help as we could get

Could we have done the wedding cheaper? Absolutely.

Especially if we didn’t know there would be some cash given to use. Would I change anything at all? Absolutely not.

Total Wedding Cost: ~$7,500

Should I Name A Beneficiary?

should I name a beneficiary

Let’s say that you’re filling out a financial form and get to the part where they ask for a Beneficiary name. Why not just leave it to your estate? It can seem like an extra piece of information to give until you understand WHY you need a Beneficiary.

You need a beneficiary to ensure that your money, whether from investments or an insurance policy, goes to the right person or entity.

Unless your lawyer advises otherwise, most people should avoid naming their Estate as the beneficiary (the default).

Funds left to the Estate may be subject to probate or other fees and could get held up. This generally takes over a year to complete. It’s not worth the headache if your loved ones would need the funds sooner than that.

As the owner of the policy or account, you choose who the beneficiary is and can make changes at any time.

Your beneficiary will not have access to your accounts or information. They will simply be given the money once you pass. This is called a Revocable Beneficiary.

The exception to this is to name an Irrevocable Beneficiary. They still cannot make changes to your account or see your information. BUT you cannot make certain changes to your own account, including changing the beneficiary, without their permission. 

Beneficiaries should always be identified by name.

Generics like “my spouse” or “my children” can be ambiguous in the future if, at death, you are in a new relationship or have step-children.

Depending on your personal situation, you may choose to name your partner, parents, or other loved ones as your beneficiary. You can name more than one beneficiary but will need to choose what percentage each party will receive.

As this article is for general information only, be sure to talk to a professional about your specific situation before making any decisions.

And remember, your beneficiary should be updated as required! Checking your policies every two years to ensure your information is up to date is a good habit.

How to Separate Your Finances After a Breakup

separate your finances after a breakup

We like to keep our topics focused on building your future and growing your finances. But sometimes things fall apart. Relationships break down and you need to figure out how to divide what you’ve built together. If you find yourself needing to separate finances after a breakup, here are some of the financial aspects you will need to get in order. Working with a professional will ensure all your bases are covered.

Who gets the house?

If you own it, you will likely be contacting a professional to split it. If you’re renting, whose name is on the lease, and can it easily be changed?

Whoever is moving will need to make sure that their address is updated. Use the Government’s website to change your address with the main regulatory agencies.

Also, update Your address with:
  •       Your bank and credit card company
  •       Investment Accounts
  •       Insurance Policies – life, health, house, car
  •       Loans or debt accounts
  •       Service accounts you hold (i.e. cellphone, hydro)
  •       Regulatory agencies you report to
  •       Your employer

How do you separate finances after a breakup?

You have a few options.

If you had a joint bank account, remove one of the names after splitting the funds. Make sure that all automatic withdrawals or deposits coming from the partner who was removed have been redirected.

Otherwise, you can each open your own chequing account and move your automatic deposits and withdrawals there. We suggest leaving your joint chequing account open for a few weeks until you’re sure you haven’t missed anything.

Now, take inventory of your new financial picture. Create your OWN budget and goals to start strong in this new chapter of life.

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If you have investments, decide which ones need to be split (if a lawyer is involved, they will advise). Remember to change the beneficiary on your RRSPs and TFSAs.

To avoid trouble down the road, keep some form of paper trail on what you’ve decided together. If you’re working with a lawyer, they will likely do this for you. If it was a verbal agreement, consider sending an email or screenshot a text message between the two of you, of your agreement.

The only constant in life is death and taxes.

Take inventory of your bills. Change the account holder of any household bills to the person staying in the home. Separate the accounts that you’ve been sharing together – like family phone plans and gym memberships.

Be sure to update the beneficiary (unless required for a loan, children, etc.) on your individual and employee group life insurance policies. It is best to make your beneficiary an actual person, instead of your estate, unless advised otherwise by your lawyer.

If you have health coverage, either remove the ex-partner or talk with your provider about a continuation of benefit coverage or other options available.

The partner being removed, if applicable, should still submit all receipts for services incurred before the separation to get the reimbursement they are entitled to.

If you are working with a lawyer, they will guide you through the process of separating finances after a breakup. They can advise regarding beneficiary changes and agreements you need to make. This list is not exhaustive and there are many more details to work out.

Sending you strength through this difficult time 

5 Steps to Stop Emotional Spending

Stop Emotional Spending

Do you find yourself in the Household section of Superstore or opening the Amazon app on crappy days? Putting things in your cart that you really don’t need, in an effort to feel rewarded for the day’s frustrations and indulge in a little retail therapy? Until you look at your bank statement and realize how quickly those purchases add up.

If that sounds familiar, you’re not alone. 63% of Canadians admit to impulsive shopping and we spend about $8.8 BILLION on it collectively, every year.

It’s easy to get stuck in a ‘stress and spend’ cycle of feeling bad for your purchases, getting stressed, then emotional spending, even more, to try and feel better. 

Stop emotional spending

We’re going to give you 5 steps to stop emotional spending.

First, forgive yourself. Beating yourself up is more likely to perpetuate emotional spending. Life can be overwhelming and finding comfort is so important. Good for you for recognizing the pattern and working towards change ❤

It’s time to stop emotional spending and replace the habit with something new. Our brains aren’t wired to listen to “stop doing that” but, they are wired for “do this instead”. That’s why replacing the habit, rather than telling yourself to just stop, is really important.

Here are a few things to try, to replace the habit:

  • Meditation
  • A walk
  • Cooking your favorite meal
  • Making something – knitting, painting, gardening
  • Reaching out to family or friends and admitting that you need some support today

Committing to a self-care practice may also be helpful. Check out our blog on that topic.

You’re right, it might not feel as comforting the first time. But, over time, your brain will learn to find just as much (or more) comfort in your healthier habit.

Next, remove easy access to spending.

Delete your Amazon app, remove notifications for Facebook marketplace, take credit cards out of your wallet, and delete any saved credit card information from your apps – you didn’t think we’d forget that one did you? 😉.

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Now that you don’t have the immediate temptation, it’s important to give yourself the right tools to adjust.

The next time you’re feeling tempted to indulge in some retail therapy, ask yourself – Would I buy this item if it wasn’t on sale? or How many hours would I have to work to pay for this?

This has helped me catch myself – just because it’s 60% off, doesn’t mean it’s a smoking deal. If I saw this item, and this was the regular price, would I be snatching it up as fast? Or would I be keeping an eye out for a sale? Realizing how much it would really cost can be very sobering.

The last suggestion we have for you is to make goals and a budget.

Turning down something you really want to buy is crazy difficult. Knowing you need to choose between this item and a weeklong Caribbean vacation, however, is much easier.

Give yourself a bigger goal to work towards so that you’re not giving an item up, you’re choosing something better!

These beginner savings tips will help you get started.

Those are the five steps to stop emotional spending. They really will work if you commit to them. Retail therapy is a hard habit to break, so give yourself credit for every step that you take.

Spring Clean Your Paperwork

Does spring cleaning make you think of new beginnings or want to run? On our team, Brittany spring cleans for fun and Alyx would rather spend that time sewing or with family. The most difficult part about spring cleaning must be figuring out how to organize paperwork. Especially if your paper organizing strategy has a lot to do with paper piles. Let’s talk about how we can organize paperwork while we spring clean.

First, decide if you want hard copies or to make it digital.

Keep in mind that you will need hard copies of some forms and that anything you make digital should be backed up (cloud, email, external hard drive).

Locate the following and make a pile on the floor or a folder (physical or digital) for each:

  • Wills
  • Mortgage documents
  • Life insurance policies
  • Health and dental plan booklet
  • Tax returns and Notice of Assessments
  • Home and car insurance policies
  • Banking documents
  • Loan statements
  • RRSP/TFSA/RESP statements
  • Receipts to save

Now that you know where it all is and whether you want hard copies or digital copies, we can organize the “paperwork”. We’ll give you a few options on how to do this.

Option 1: Quick fix for hard copies

Use a boxy file folder with each slot labeled for all the above information.

In January each year, take out old statements, receipts, warranties, and either shred, put into a tax folder, or move to a locked metal document box in the basement. That locked metal box is where you’ll keep your passports, marriage license, warranties, copies of wills, and other long-term important documents. Bonus points if your metal locked box is fire and flood-proof!

Chances are, you have some paperwork on your computer – emailed receipts and such – that also need a home. We suggest either printing those off and putting them in your boxy file folder or reading option 2 and applying it just to those documents. Of course, you would simply substitute scanning your documents by saving them directly into the appropriate digital file.

Option 2: Make it digital

Start by making a folder on your computer for personal documents. Within your folder, create a file for each pile that you have – Will, Mortgage docs, receipts, etc.

Then, working with one pile at a time, scan the documents onto your computer. Change the name of each document to its proper title so that you can find it easily later.

You can organize paperwork as specific as you’d like with this.

You might be content keeping your documents in these main category files and scrolling through for what you need.

Or, you might want to make it more specific. For example, you can have a main folder for your banking documents and create sub-folders within that to separate your statements, contracts, notices, etc.

Remember to have backups of all digital files.

Option 3: Put it all in a locked filing cabinet

organized filing cabinet

This is similar to going digital, but for hard copies. You’ll organize paperwork by making a hanging file for each category with a label.

Then, if you want to make documents easier to find, label a file folder to make more specific categories.

You’ll notice this is very similar to option 1. The difference is whether you want all of your documents in one place or if it’s more convenient to have quick access to the ones you’re most likely to use.

As you’re going through your paperwork, let’s make this even easier for the future.

  1. Know where your will is – It is often kept on file with your lawyer, but you should also have a copy
  2. Make a calendar note for when your mortgage term renews
  3. Review when your life insurance payments are due and if you have any renewal dates. Book a quick call with us if we can help you here.
  4. Review your Health and Dental Plan booklet and be sure you understand your long-term disability benefits
  5. Sign up for CRA’s “My Account”. This site makes accessing documents and benefit information (such as GST, Child Benefits, etc.) much easier.
  6. Make a calendar note for the renewal dates of your home and auto insurance policies
  7. Review your loan statements and interest rate details
  8. Review your investment statements and note your investment choices – ex. Mutual fund, GIC, RRSP, etc.

Now that you have your paperwork organized, you’ll have easy access to your documents when you need them, get reminders on renewals, and you may have found a few ways to save money during your interest and investment reviews!

Once you’ve got all these important documents organized, you’ll be ready for your next step in financial awesomeness! Is your budget the next task on your adulting checklist? Read our blog on the 123’s of Getting Your Finances in Order.

I’m Scared Of My Accountant

How to fire your accountant

This article was written by Jen at Dollar Divas and offered to us to use. Be sure to visit her page!

One of my favourite “ah ha” moments at Dollar Divas came a few years ago during a discussion group. We had been chatting about hiring the right professionals and how to find them. When a woman who had been pretty quiet all evening finally joined the conversation.  

“I dread going to my accountant every year,” she said.  

Saira and I looked at each other and said simply, “Then get a new accountant.”

Slowly the realization sunk in that she could fire her accountant and move her business to a different account. It was like a huge weight was being lifted off her shoulders. This Diva felt loyal to someone she hated simply because she had used him for many years. 

This is not an uncommon issue. 

Many women stick with professionals who are the wrong fit simply because they don’t want to rock the boat—and it needs to stop. 

Here are some tips to help you fire your accountant (or other professional) without feeling the guilt.  

  • Speak up: If your professional is not serving you to your satisfaction, you are not required to continue accepting poor service. Speak up! Most professionals will continue with the status quo unless you voice your concerns. A good professional will change their actions when their clients voice an issue. If you have already taken this step and nothing has changed, then it is probably time to start shopping elsewhere.
  • I like me best: Something I witnessed over and over again is a woman staying in a professional relationship that was not serving her simply because she was afraid of hurting someone’s feelings. Many women have told me that ending a professional relationship is like parting ways with a boyfriend. If this is you, something to keep in mind is, “I like me best.” While putting others above yourself is noble, it is not always in your best interests and there are better ways in which to do this. If you have already tried to talk to your professional and nothing has changed then it’s time to find someone new who can serve you better.
  • Have someone else do it: Ending a long-term relationship with a professional can be difficult for some people. The good news is, a lot of times, you don’t actually have to have that super uncomfortable conversation. Once you have found a new person to work with, they can usually have that conversation for you. In the case of a financial advisor, it is as easy as having them request a transfer from your old institution. No ugly confrontation required. If you get a bitter and angry phone call or email, that will confirm that you have made the right choice by changing.

I can’t speak for all women, but a lot of the women I know are wired to be people pleasers.

While this may serve them well in their personal lives, it is not necessarily conducive to healthy professional relationships. 

Personally speaking, this quality has landed me in more than one uncomfortable situation. Where I was not being served well, but I was too afraid to make a change thanks to some bizarre sense of loyalty. Learning that I can make a change has not only been liberating, it has been lucrative. 

At the end of the day, you need to look out for you, and if you’re not happy, then something has to change. 

The 123’s of Getting Your Finances in Order

how to get your finances in order

Do you feel like you have your finances in order or are you winging it? Talking about finances can be really difficult because the conversations are so emotionally charged. It’s easy to have fears, insecurities, and frustrations tied into our finances. We understand that because we’ve been there too. Rather than getting trapped in that cycle, we’ll walk you through how to get your finances in order.

Step 1: Make a Budget

Have you ever put a puzzle together without having the end picture in sight? Probably not. You know that’d make the task much more difficult than it needs to be. 

The same goes for your budget. Without seeing an accurate picture, it’s hard to understand what you need to do to reach your goal.

How to Start

Grab a piece of paper and write down how much money your household brings in each month at the top of the page. Below that, write the following headings:

  1. household
  2. transportation
  3. food
  4. entertainment
  5. clothing & gifts
  6. others

 

Then, go through your bank and credit card statements for the last month and pair each expense with a heading, and total them up.

Now you know how much you spend each month AND what you spend the most money on.

Add up all of your expenses. And subtract your income from expenses. That’s how much money you have left over each month.

If you’re spending more than you’re making, you need to go over your expenses and your income to see what changes you can make.

To finish off your budget, decide where you want that extra amount of money to go. Maybe debt repayment, a vacation, or one of the following.

Step 2: Make an Emergency Plan

There are SO many angles to look at this from, so we’re going to cover 3 main angles.

Make an Emergency Fund

This is priority numero uno. Your emergency fund should be at least enough to cover 3 months of expenses. And yes, that’s a big number. But this emergency fund is going to keep your budget on track, avoid stress in a financial crisis, get you through a job loss, and a lot of other 💩 that life can throw at you. 

Our suggestion is that you put a manageable amount of money aside each month, into an account that you don’t have access to via bank card, like a TFSA. 

What if something happened and you couldn’t work for a long period of time though?

Just because you don’t have an income, doesn’t mean the bills stop. Because saving enough to cover you (and maybe your partner) taking a long period of time off of work isn’t realistic for most people, get disability insurance. It replaces a portion of your income if you’re hurt or sick.

There are also insurance plans that would help financially if you couldn’t work because your child was sick.

Get life insurance

It’s not for you, it’s for your loved ones. It’ll help them pay off debt (including the house), afford the expenses of growing kids, and finance the changes in lifestyle they’ll need to make.

When we talk about how to get your finances in order, we also need to consider protecting them.

Make a will

Without a will, your loved ones may have to wait a long time and pay fees to get their inheritance. In order to avoid conflicts and ensure your family is taken care of, sit down with a lawyer and knock this off your task list.

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Step 3: Make a Savings Goal

Now that you know what your financial situation looks like and you’ve made sure you’re covered if it ever took a hit, you need to make a savings goal.

Saving looks different for many people – both how you save and what you save for. It could be saving for a long-term expense like retirement, a property, vacation or large annual bills.

Whatever it is, you’ll need to refer to your budget again.

You know how much you have leftover now, so you can decide how much of that you want to put into saving. 

Make sure that you do the math on how long it’ll take to save what you need. Putting $100 aside for a new car each month might sound like a great idea until you realize it’ll take you a year just to save $1,200.

You’ve probably realized that there’s nothing glamorous about getting your finances in order.

It’s not as fancy to whip out a debit card as it is a Black Card nor is it too fun to spend your free time putting this all together. It takes discipline, a firm grasp on what you’re working towards, and boundaries.

But how good would it feel to not be phased by a surprise bill? Or to know you’d be okay if you lost your job?

These things aren’t glamorous but the freedom and security you can afford by following these steps on how to get your finances in order are much more rewarding.

Be sure to share this with your closest friends who want that same freedom!

Take control of your financial future. 

Surviving Coronavirus in Canada

Coronavirus in Canada

Feeling uneasy or maybe a bit scared by what you’re hearing in the news right now? They’re talking about market free falls, a disease that has people quarantined and likely all of your upcoming events have been canceled. People are panicking and bulk buying, and you’re trying to keep your cool while wondering what you can do to survive the Coronavirus in Canada. Knowledge is power, so let’s talk about what you have control over.

The virus is affecting our World way beyond health. 

It’s hitting our communities, lifestyles, and economy drastically. But don’t fret! There are things you can do about it. Right now, it’s important to take care of our communities and make sure that we’re prepared.

How can we support people?

Community is so important in times like these. Sharing resources is the perfect place to start. Whether you have food or coveted toilet paper, sharing is caring. Our local heroes are helping people who don’t have access to their medications and other necessities right now.
Let’s not forget those suffering in silence from their mental health, too. Those with an anxiety disorder that’s being perpetuated and domestic abuse victims who are quarantined in dangerous situations are part of that group.

Reach out to your friends and family. You may not know what they’re struggling with behind closed doors. That human connection and support are so important right now.

Buy local.

You’ll hear us talk about that a lot at Iron & Pearl. Shopping locally can make a big difference, especially right now. These businesses often don’t have online stores or second locations that they can make an income from. It’s a family behind the scenes who relies on the income that their business brings in. Buying local is critical to curbing this financial crisis.

Stock what’s necessary.

At this point, we’ve been instructed to stay home if at all possible. It’s always a good idea to have a couple of weeks’ worth of food on hand in case of an emergency. Surviving the Coronavirus is no different. It’s important to have what your family needs but it’s not necessary to buy stores out of their stock. When we do that, it takes away resources from those who haven’t been able to leave the house – mothers of young children, the elderly, and those fighting on the front lines. Look out for your neighbours.

Keep an eye on your emergency fund.

Your family has told you for years that you need to have an emergency fund. Do you have one? Many people don’t have much of an emergency fund. Either from not seeing the importance of it or because money was tight before any of this happened.

We’re hoping that you see how imperative an emergency fund can be at this point. Check out our blog post on “how to save money without making more” to read more.

Keep an eye on what you’re spending as well. As much as spending would help our economy, spending unnecessary money right now may hurt you later.

Stop looking at your investment statements.

You know they’re not looking good and so do we. Our advice still stands – don’t sell. Have you ever heard the sage advice buy low, sell high? That’s exactly what we should be remembering right now. Unless a professional who knows your specific case has told you to sell now, just hang tight.

“That’s it, we’re done.”

Don’t let yourself get to that point with your finances. There’s no doubt that some people will be hit hard financially by this market free fall. But, there have been measures put in place already. If you’ve been quarantined or laid off, look into EI benefits. They’ve made some big changes to ensure you’ll have at least some income right now.  BC Hydro and the big mortgage lenders are offering for those in a tight financial spot to defer their payments for up to 6 months. Keep in mind, you will still have to honor those payments. But, if you’re genuinely struggling to make ends meet, take hold of this opportunity.

Filling out an insurance application?

It’s going to take longer. If you’ve recently traveled, you will have to be in quarantine for 2 weeks before they can consider your application. Companies have stopped issuing travel insurance and medical tests have been suspended until further notice – making it more difficult to get many types of personal insurance. “Business as usual” may not really be. Insurers have people working from home or locked-down offices so that your questions can be answered, but buying yourself a policy will be more tricky.

Put your phone down.

We’d prefer it if you finished reading this article first 😉 but try not to stay right on top of the news. There are scary videos coming out on social media, headlines that’ll turn your stomach, and helpful Government plans that make you feel nervous about how long this will last.

Keeping yourself up to date may seem helpful, but it can also be anxiety-inducing. If you’re feeling overwhelmed or uneasy about this situation, stay home and put your phone down. At this point, helpful information may actually be harmful to you. Having Coronavirus in Canada is going to be all about preparation and education.

This is a scary time for the World. Building community and leaning on each other might just be the silver lining in all of this.

We won’t be staying quiet in our offices as this goes on! Follow us on Instagram or Facebook for consistent updates on the financial support that Canada is offering and other options available to you.

As always, reach out to us through our contact page and we’ll do our best to help.

Canada's March 18 Covid-19 Economic Response Plan

Why Mom-preneurs Need Life Insurance the Most

why mom-preneurs need life insurance the most

As a busy business owner, do you feel like you’re running around like a chicken with its head cut off? Holding client meetings, being a parent taxi in between, meal planning, running the house and being the glue that holds everything together. Who would do all of that if you couldn’t? That’s exactly why mom-preneurs need life insurance the most.

If working from home allows you to chauffeur your kids, run errands, do chores or be a homemaker, your family would be lost if you weren’t there.

Even if you don’t work from home, hired help and put systems in place so that certain things can run smoothly without you there, your family will still be scrambling to do those little things that often get overlooked. Not to mention how much they’d miss you.

Your business may also be an asset.

Having a plan to cover your business expenses until it can be sold would be a tremendous help to your family. Or, maybe your kids are a bit older and one of them would like to run your business. Giving them or your business (if it’s incorporated) a set portion of your life insurance benefit would afford them what they need to transition your company.

For example:

  • Cost of closing your business
  • Covering outstanding debts
  • Capital Gains
  • Ensuring your employees/subcontractors are paid for their work
  • Legal fees
  • Taxes
  • Financial obligations, especially if you personally guaranteed your debts against your home/investments/etc.

Of course, that’s not an exhaustive list – just a starting point. Talk to your Financial Planner/Accountant and Lawyer to determine exactly what you need.

Especially if you’re a sole proprietor, consider your personal taxes as well.

We want to prevent your family from getting any unexpected, large bills. Sitting down with your Insurance Broker or Financial Advisor is the first step in ensuring your personal and business finances are in order if anything does happen.

Mom-preneurs need life insurance the most because they often juggle two important roles – a business and a home.

You have a very important role and play a detrimental part in caring for both your business and your family. Having a life insurance policy and talking about a plan with your partner can ensure that they’ll be taken care of, even if you’re not there.

Remember, you’re in control of your financial future.

It takes time and effort to put plans like this in place, but it’s worth it to know that your family is taken care of.

If you could use weekly reminders about taking a holistic approach to caring for your finances, join our newsletter!

What Is Disability Insurance?

what's disability insurance

There is a type of insurance that’s painfully underrated. I’ve never understood why. It can save your life – or at least your lifestyle. It’s Disability Insurance. What is Disability Insurance? Well, we’re going to cover that in the short video below!

Disability Insurance replaces a portion of your income if you’re too hurt or sick to work.

It gives you the ability to keep paying your bills so you can focus on your recovery. Maybe you’re able to use WorkSafe or Employment Insurance. Just remember, they only pay in certain circumstances and/or for certain periods of time. If you’re self-employed or working a side hustle and not sure what you qualify for, read these 2 blog posts: What If I Get Hurt At My Side Hustle? | Government Benefits for Self-Employed Canadians

EI Insurable Earnings

With a plan like the one we walked through in the video above, Sam was able to fully recover and didn’t have to stress about paying her bills or have increased debt. Having an emergency fund to supplement her Employment Insurance and extending her personal disability insurance waiting period, so that the benefit starts later, made the insurance premium much more affordable.

Disability Insurance is a very flexible product. You can customize when it starts paying you, for how long, and how much.

You can also choose whether you’re covered for accidents, sicknesses or both.

Accident coverage is a simple concept – it will pay you if you can’t work because of an accident. Sickness coverage, on the other hand, is more robust.

Sickness coverage can replace your income from serious illnesses like cancer or other internal pains like muscle wear-and-tear.

Getting both accident and sickness coverage can cover you from *almost all angles.

What Disability Insurance doesn’t cover is medical expenses and long-term care. Those are 2 separate types of insurance.

The benefits of disability insurance shouldn’t be underestimated.

Here’s an example:

Let’s say Sam is 30 years old and makes $50,000 a year as a bookkeeper. The accident was much worse than a concussion and Sam will never be able to work again.

We’re going to make this fair and compare her after-tax income of $39,586.

Assuming Sam works the same job until she’s 65 years old and never gets a raise:

$39,586  X  35 years  =  $1,385,510

If Sam qualified for the CPP Disability benefit (permanently disabled or likely to die from the condition) and received the average $1001.15 per month benefit:

$1001.15  X  12 months  =  $12,013.80    X  35 years  =  $420,483

Let’s minus her CPP benefit from the income she’s missing out on:

$1,385,510 lost wages    $420,483 CPP Benefit = $965,027.00

That means that in the BEST CASE SCENARIO, Sam would lose $965,027.00 in income. And that’s if she never made more than she does right now.

If Sam doesn’t qualify for CPP disability and again, never gets a raise, she’ll lose out on

0
CAD $

But Sam still needs to pay for her living expenses and might need to pay for medications or disability support now, too.

That’s why we believe that disability insurance is painfully underrated.

Remember, you are in control of your financial future. Plans like this can play a crucial role in securing your family’s lifestyle.

It takes time and effort to put in plans like this, but it’s worth it to know your family will be taken care of.

*Each policy is different. There are exclusions in all insurance policies.

.

What are My Life and Health Insurance Options?

Trying to figure out what your life and health insurance options are? You have so many choices when it comes to insurance, so this question can spark some confusion. But you’re not alone!

It’s not uncommon to sit down with a new client and they tell us they’re not sure what kind of insurance they need. They just know what they want to prevent.

You can get just about anything covered by insurance nowadays. Kylie Minogue even has her tooshie covered for an easy $3M.

Getting your THINGS covered is fairly straight forward but it gets a bit more tricky when we talk about covering your PERSON.

There’s an endless list of situations you’ll want to cover but only 6 types of insurance. 

your insurance options

Life Insurance

Pick your benefit amount (within reason) and this plan will pay a sum of money to your loved ones when you pass away. That includes Mortgage Insurance, Term Life Insurance, Whole Life and Universal Life Insurance.

If you have debt or a growing family, this is a must!

Disability Insurance

It replaces your income if you can’t work while recovering from an accident or illness. Without an income, how would you pay your bills?

48% of Canadians have disability insurance and almost all of those people are covered through employee benefits, not because they bought it themselves. The other 52% only has E.I. to financially help in this situation – and that stops after 15 weeks – that’s a scary statistic!

Critical Illness

Pick your benefit amount and this plan would pay you a sum of money if you survive a critical illness like cancer, heart attack, etc. If you need to make changes around your home because your abilities have changed, this plan is a lifesaver. Use it to replace your income while you take time off work or celebrate the fact that you survived!

Health Insurance

Health Insurance can help or cover the cost of prescription drugs, dentist visits, physiotherapy and more. Getting hurt or sick can be more than losing your income; there are expenses that come with it. This coverage, as with all insurance, must be purchased before you need to use it.

There are a couple of health insurance options if you know you’ll need to use the plan immediately. But, those plans cost more and cover a lot less.

Travel Insurance

Canadians are pretty lucky to have the health coverage that we do. But, once we’re outside the border, we’re on our own! Make sure you’re covered wherever you go with travel insurance.

From surprise dental surgery to changing your flights last minute, travel insurance is super affordable for how much it can save you.

Business Insurance

Your life and health insurance options can be set up so that your small business gets the benefit. Having your business as the beneficiary will allow it to keep operating, even if you can’t. Make sure your business is covered! 

From covering the financial loss of your right-hand-worker who has to take a leave, to offering employee benefits, you have a lot of options!

Remember, YOU’RE in control of your financial future.

It takes time and effort to put plans like this in place but it’s worth it to know that your family is taken care of.

Have some follow-up questions? Book a Quick Call with us! We’re here to help 💪

How to Make New Year’s Goals Fun

New Year's goals the 20 20's of 2020

Happy New Year!

We’re officially 1 week into an entirely new DECADE! How crazy! If we’re anything alike, you have lofty goals for the new year. And, now that we’re back to reality, accomplishing those new year’s goals might feel overwhelming.

With you (honestly, and us) in mind, Alyx made the 20 20’s of 2020!

This adorable checklist was originally made by Good Food Ambassador, Bri, and we’ve added our own spin.

Last week we sat down to talk about our New Year’s Goals.

The beginning of the year is an exciting time! You’re rested from time off over the holidays (hopefully) and thinking about all the opportunities this year could bring.

With those opportunities comes goals to eat better, organize the house, have a better social life, and so forth. But, once you’re back in the swing of things, it’s hard to put that into action!

Especially when the goal is as vague as “organize the house” …if we’re being honest here.

“Vague goals produce vague results.” – Jack Canfield

Turning goals into a fun checklist is an easy way to specify what you want AND keep you on track!

Scroll down a minute to look at the fun-sheet.

Is there anything on there that you don’t think you could do? If there is, spend a minute thinking about how you could make it work for YOUR life.

We’re starting small here. A family adventure doesn’t have to be a cruise. It should be as simple as trying out a new beach or hike together. Organizing the house is a daunting task, but cleaning out the utensil drawer is definitely more manageable…and worth a check off the list! ✔

Do you have a 20 of 2020 you’d want to add? Let us know in the comments below!

How to make 2020 New Year's goals fun

Download a copy here: Iron and Pearl Financial 20 20’s of 2020

What Does Travel Insurance Cover?

Whether it’s for work or fun, travel insurance often gets brought up when you’re going away. Not sure if you even need to get it? Visit our blog post on that on that first. If you’re sure you need it but are wondering what does travel insurance cover and are confused about the situation, you’re in the right spot! 

Travel Insurance covers you for extra expenses you might have if something bad happens on your trip.  

You’ll have the option to cover everything from cancelling your trip after you’ve paid for non-refundable hotel and airfare, to ending up in the hospital after an accident or catching a serious bug. You can even get coverage if the airline loses your luggage and leaves you with one pair of underwear. 

Now, I make light of it with the one pair of underwear thing, but people’s lives have been ruined over an out of country hospital bill forcing them to declare bankruptcy. 

However, you may already have travel insurance! 

Take a look at your Work Group Benefits plan and see if that offers anything. Your credit card or other member benefits plans that you’re a part of could also be used in this situation. Make sure you take a look at what you’re actually covered for and how much before you leave. 

For example, some credit card companies offer travel insurance, but only if you booked your trip using that credit card. Others will only cover you in certain, extreme situations and all plans have a maximum amount of money they’ll pay 

If you have multiple plans that cover you – for example, coverage through your credit card AND you’ve bought separate travel insurance – the contracts will tell you who the “First Payer is. That’s the Insurance Policy that has to pay you first. You’ll submit your bill/receipt to that company and they’ll pay you based on what the contract says. If they pay the whole thing, your second policy WILL NOT pay you. If the First Payer doesn’t cover your whole bill, THEN you can send the remainder to the next insurance company. You cannot have one bill paid by 2 companies. 

Keep in mind, most plans WILL NOT cover you if you’re intoxicated when you get hurt. 

For Canadians, each province has its own health plan. Just because you’re a Canadian resident does not mean you’ll be as covered in other provinces as you are by your own Province’s health plan. Provincial health care coverage is required for these individual plans, so make sure your account is up to date. Plan accordingly.  

Travel Insurance is there to cover the expenses of getting hurt in another Country or Province. You don’t pay into other Country’s medical systems like you do in Canada through MSP (or equivalent) and taxes, so you have to pay that Country’s full price. And it can be very expensive. 

Ending up in the Hospital or passing away and needing to transport your body home are the most expensive things you’ll want to cover. As I said, you’ll have to pay full price for any hospital and medical attention you require.  

Travel insurance covers a number of things. Here are a few benefits you might want in your plan: 

  • Emergency MedicalEvents or sickness that could land you in the hospital, Doctor’s office, etc. 
  • Trip cancellation and InterruptionGetting your money back if you have to unexpectedly cancel your trip or having to book a hotel if your flight is delayed.
  • Baggage loss, damage, or delayTo keep clothes on your back if your baggage is delayed or to replace items if it gets lost
  • Travel accident including death and dismembermentpassing away in another country is VERY expensive. Your body needs to be processed and specially transported back home. 

Travel Insurance is certainly worth it, but it’s not mandatory. The chances of having to use your insurance is quite low. The risk you’re taking on, however, is MUCH greater than if you were at home and put in the same situation. 

There are 2 MOST IMPORTANT things you need to know about Travel Insurance: 

  1. How to claim: know before you go. Your policy might require you get certain Doctor’s notes or Xray photos that will be hard to get once you’re back home. 
  2. You’ll probably have to pay the cost up front. Most often, you’ll have to pay the Dentist/Doctor/ Pharmacy bill before you leave their office. You’ll submit the receipt to the Travel Insurance company when you’re back home to be reimbursed. Make sure you have some emergency cash! 

 

Looking for a travel insurance? Give us a call!

Happy Travels 💃🕺 

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Should I buy travel insurance if I’m just visiting family?

We’d been planning this trip since we first started dating. My husband is a Can-Aussie (that’s half Canadian, half Australian) and hadn’t been back to Australia since his early teens. So, at this point, it’d been about 10 years. He was pretty disappointed his Canadian wife didn’t know what a ‘real wave’ was 😆 

We found a crazy deal on plane tickets and, after 6 years together, finally booked our trip Down Under! We were incredibly excited. The bikinis were bought, bags were packed, pets were taken care of. But we hadn’t bought Travel Insurance. 

Our trip wasn’t going to be dangerous in any way – the main goal was visiting Family and jumping in waves. 

Australia is home to him and everything would be in English anyways. Plus, the trip was really expensive to bookWe didn’t want to waste our money on insurance because, honestly, it’s not like we’d have to use it. It’s not a dangerous country and we’d be with Family the entire time. 

But I was terrified of the snakes and spiders (the only ones we ended up seeing were in a zoo 😎) so I bought it just in case. 

5 days into our 3 week long trip, we were staying in this dingy hotel downtown and I wake up in the middle of the night feeling like I’m in a horror movie. My face felt like someone had taken a baseball bat to it. I’d never had this before but was bawling from the sharp, throbbing pain in my jaw. 

First thing the next morning, we went to a walk-in clinic. They weren’t sure what was wrong ($150.00). So, thesent me to a Dentist ($300.00). This pain in my jaw would not go away. 

After plenty of xrays and questionnaires, the Dentist tells me my wisdom tooth was badly infected from a weird kind of cavity. My only option was to have it pulled on the spot ($215.00) and continue the trip on antibiotics ($80.00). 

She had me in and out of that chair in 5 minutes – seriously, this Dentist was incredible. 

Our emergency Dental coverage was $500 this cost $515. 

The emergency medical part of our plan covered the walk-in-clinic and the prescription drugs. 

This $20 travel insurance plan saved me a $730.00 bill from a surprise wisdom tooth infection. 

From the Dentist, we left on our 6hour journey to visit more Family.

Now, wherever I’m going, I will buy travel insurance.

I really hope you do too. 

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Do I Need Travel Insurance?

Holy Toledo, traveling is expensive!! The planes, hotels, food, entertainment… it adds up so fast. We both know you worked REALLY hard to go on this vacation. So it can be super temping to try and save a few bucks however you can – even on a $20 travel insurance bill. That could be the cost for an entire experience! Do you really need to buy travel insurance? 

Well, that depends! I’m a huge advocate of buying it after that time I almost didn’t. But you don’t want to buy it if you don’t NEED to. 

Surprise! You may already have travel insurance! 

Take a look at your Work Group Benefits plan and see if that offers anything. Your credit card or other member benefits plans could also be helpful. Just take a look at what it actually covers you for before you leave; they likely won’t cover you in countries currently on the Canadian travel advisory list and there may be other limitations that surprise you. Learn more in our article on What to Know Before Buying Travel Insurance.

No one wants to be pressured into buying something. So, rather than telling you why I think it’s important, ask yourself these questions: 

  1. How safe is the Country you’re going to? Check out the BC Gov Travel Advisory. Keep in mind, many travel insurance plans exclude certain countries and have other limitations.
  2. What’s your plan if you get sick while you’re there? Plan for anything from a cold to critical illnesses (heart attack, picking up a disease, etc.)
  3. If you break your leg, can your trip continue?
  4. What if your body decides now is the time to tell you you have a health concern? It happened to me!
  5. If you were in a car accident and ended up in the hospital, could you afford the bill?
  6. If you die while you’re there, your body will need to be processed and transported back. That costs thousands of dollars even for neighboring countries. Could your family afford that? 
  7. What’s your plan if you get sick and the airline won’t let you on the plane until you’re healthy? 

Now, of course, none of this is going to happen to you 😉 

But, if you’re concerned that it could, go ahead and get travel insurance. You can’t get it once you need it!  

If you’re under 60, it’s quite affordable. You’ll be offered a lot of options from coverage for the concerns above (Emergency Medical Coverage) to trip cancellation insurance, baggage insurance, and many more. 

Looking for travel insurance? Give us a call!

Happy Travels 💃🕺 

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What to Know Before Buying Travel Insurance

So, your Wanderlust got the better of you and you’re off on a new adventure! But adventure has a chance to go sideways, and that’s what you’re here to prepare for. It’s not super complicated, but there are a few things to know before buying travel insurance.

First, how often do you travel?

You’ll get to pick if you want to buy travel insurance for the one trip or coverage for the whole year. Buying by the year costs a bit more up front but if you’re going away a couple times in a year, you can save a lot!

When it comes to buying travel insurance, there are a number of things you may want to insure. The most important being accidents and emergencies (including death).

Driving back through the boarder with a broken leg after a day of shopping is one thing, but if you passed away unexpectedly, your body needs to be properly processed through the boarder – a surprisingly expensive event!

For short trips, what would happen if you ended up in the hospital from a serious accident?

For longer trips, add getting hurt or sick and needing to see a doctor before you can fly home to your list of concerns. There are plenty of other emergencies that could land you with a Doctor’s bill! (link to my travel story)

Less serious things to think of are trip cancellation insurance if you have to cancel unexpectedly, baggage insurance in case yours gets lost (to help buy fresh clothes/toiletries/etc.), and rental car protection.

Keep in mind, there are certain countries that Insurance companies will not cover you in. Specifically, countries with civil unrest or on the Canadian Government’s Travel Advisory.

There are exclusions to almost all Travel Insurance policies. You won’t be covered if you are intoxicated by liquor or drugs, skydiving, professional racing and other sports.

Traveling with medical conditions?

Make sure you disclose it to your insurance agent. There are companies that will cover you EVEN IF you have a health concern. Make sure that you look at what you policy’s “Stability Period” is. That’s the amount of time your condition needs to be stable for, before you can apply for insurance. It’s typically a 90-180 day period BEFORE YOU APPLY. This includes ANY changes to medication. If in doubt, ask to fill out a health declaration and get written approval from the insurer – your Insurance Broker can help with this.

 Whether the company looks at your medical history when you apply for the coverage or when you make a claim, they will find out if you have an existing condition. Honesty is the best way to make sure you receive the benefit if you need it.

Here’s where you can buy travel insurance:

  • An Insurance Agent/Broker: Some may sell travel policies.
  • Travel Agency: These professionals are not licensed in insurance but can still sell travel insurance.
  • Online: It can be much more difficult to make sure you get the right travel plan this way.

There are 2 IMPORTANT things you need to know about Travel Insurance:

  1. How to claim: Know before you go. Your policy might require you get certain Doctor’s notes or Xray photos that you won’t be able to get once you’re back home.
  2. You’ll likely have to pay the cost up front. Most often, you’ll have to pay the Dentist/Doctor/ Pharmacy bill before you leave their office. You’ll submit the receipt to the Travel Insurance company when you’re back home to be reimbursed. Make sure you have some emergency cash!

Whenever possible, call the Insurance Company’s Emergency number for assistance. This can help with choosing a hospital, accessing translation, and getting help with or arranging bill payment.

There can always be unexpected situations that we didn’t cover here. The best way to make sure you get the help you need, is to know what your contract says!

And that’s what to know before buying travel insurance! Hopefully you don’t have to use it, but it’s important to have just in case.

Happy Travels! 💃🕺

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Common Mistakes to Avoid When Making a Claim

I’ve had to file a few Insurance and Government Benefit claims in the last few years. There are a number of common mistakes to avoid when making a claim!

I’ve been through this process 8+ times in the last 4 years (it was a chaotic season 😆) and have learned many lessons. I made a few mistakes that you can learn from when claiming benefits from a personally-owned policy, work group plan, and Government Programs like WCB/ICBC/E.I. It’s a big part of WHY I chose to work in this field. 

Making a claim – using your insurance policy or Government program – involves A LOT of paperwork and there’s room for error.

There are a lot of common mistakes to avoid when making a claim. Here are some tips that may help!

First, don’t wait to say you’re hurt!

Injuries can take a few days to develop. Document what happened either by going to the Doctor or filling out an incident report. I had an issue when I didn’t think a work accident was a big deal until a few days later. By that time, I couldn’t prove it happened at work. It’s especially important with a muscle injury which can be considered wear and tear of your body.

Next, keep a paper trail.

This is important! Carriers cannot and will not take your word that there was an accident or that you’re sick. You MUST document it properly. This could be an incident report at work, going to your Doctor, walk-in clinic, or emergency room. Some companies may accept a report from a professional such as a massage therapist, chiropodist or chiropractor.

Continue to keep a paper trail of your injury. Some people keep a journal of their pain, appointments, phone calls, etc. We found it really helpful when my husband was thrown from a ladder and we had a hard time getting coverage for the tissue damage he suffered. Journaling isn’t required, but it can save you some big headaches. Again, the companies will not take your word for it, so you need to continue to follow up with your Doctor, massage therapist, chiropractor, or other licensed professional – Carriers will accept documentation from specific professionals, so check first.

Even while my husband was working after that ladder fall, he went to go to the Doctor every 2 weeks to get proper documentation on his pain because it didn’t feel right. It was his saving grace when, what we thought to be an easy-to-prove injury, was still denied. If he’d stopped going to the Doctor (even while his claims papers were being processed), we couldn’t have proved the extent of his injury to have the decision appealed. One more time for the people in the back: Claims Adjusters will not accept your word for it!

Specific to Disability insurance: You will not be covered for your full wage so make sure you have enough insurance AND an emergency fund!

Canada has an All Sources Maximum. That’s the total amount of money you can get from disability insurance, Government Benefits, and any other source COMBINED. Its 85% of your NET income. For example, if you’re getting a disability benefit from ICBC and you have accident insurance, together they can pay you a maximum of 85% of your income (after-tax).

You’re still out 15% of your income. Think about the extra expenses you’ll have because of your injury too – extra take-out, child-care, your partner taking time off work to help you, etc. We all know someone who’s been on disability – what were they worried about? This is why Emergency Funds are so important.

The 3rd mistake to avoid when making a claim is not asking for direction from the claim’s adjuster.

Adjusters have a lot of cases on the go. To make YOUR life easier, ask how long it’ll take when you’re waiting on an answer from them. They’ll probably be able to tell you it’ll be at least a few days/2 weeks/etc.
The process will be smoother if you’re on the same page.

I’ve also had adjusters that wouldn’t return my calls.
One time, I was almost cut off my benefit because my contact person wasn’t responding and the company thought they hadn’t received an update from me in weeks. That’s not a slam against adjusters – they have an incredible amount of work on their plates.

My rule of thumb is, if I can’t get a hold of them in over 2 weeks (not including how long they had told me I’d be waiting), I call in and ask to be transferred to a new adjuster. 

The last mistake I made was not knowing the contract.

You need to know your contract! Many points are standard through insurance contracts and Government disability benefit programs. Each source will have specific requirements when you make a claim. For example, when we went to Australia, I got traveler’s insurance. Being a realist (and having made this mistake already), I read the contract first. AND I’M GLAD I DID! I had a very painful, infected wisdom tooth 6 days into our 21-day trip and had to go to the dentist. I knew the contract and that I’d need a note from my dentist, including pictures, proving it was unexpected, emergency dental surgery. It would’ve been hard to get when I made the claim a month later! The tooth was pulled on the spot and getting reimbursed for my expenses was easy.

Contracts can be hard to understand. It’s why I’m such an advocate of having an Insurance Agent. Whether it’s an agent or a broker, having someone that you can call, rather than a 1-800 number, when you are in situations like this will make all the difference.

Remember, this is in no way legal advice or counsel and is based on my experience in these situations. The information is of my opinion and experience and does not reflect the industry as a whole. Please click on the links provided and talk to your Insurance Adviser with any specific questions.

Being injured can be a stressful time. I hope that this article will help you avoid some of the common mistakes that I made while going through the claims process!

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Being Grateful Is Good for Your Health

Mindset has become a HUGE topic of discussion this year. It’s usually around productivity and being happier, but there’s another other side you need to know about! Mindset, specifically having a grateful mindset, is good for your health!

Your mindset affects your body’s biochemistry, which affects your health. I’m sure you’ve heard of the studies proving stress can lead to heart disease!

Gratitude can affect your health,both physical and mental, in astounding ways! Many studies strongly suggest that being grateful is good for your health – like lowering anxiety, recovering from depression, and getting a better sleep. Which, bonus: boosts your immune system! Some studies even prove that practicing gratefulness can change your physical body, to help you recover from illnesses! It’s pretty interesting stuff,

As a matter of fact, a study done in 2007 by Shipon, R. W. looked at the perspectives and blood pressure of inner-city African-American hypertension patients. The patients counted their blessings once a week and the study’s results showed a significant decrease in their systolic blood pressure – by 10%!

“Something as simple as writing down three things you’re grateful for every day for 21 days in a row significantly increases your level of optimism, and it holds for the next six months. The research is amazing,” Shawn Achor – Harvard researcher and author.

Stress, especially if it’s often or chronic, is proven to have serious harmful effects on your body, including heart disease, diabetes, anxiety and depression. I won’t go into that because, quite honestly, the research is terrifying.

Many researchers, including Brené Brown, argue that ‘feeling’ grateful isn’t enough. You need to practice gratefulness. It can be done through meditation, prayer, journaling, and many other practices. For more information, see the links below.

When we truly feel grateful, and even when we practice acts of kindness, our brain gets flooded with dopamine – that’s the happy chemical. Our brains are rewarding us! Dopamine is one of the chemicals that helps those suffering with depression and anxiety find relief, or beat their illness altogether – it’s a powerful chemical. Click here to read more.

On the same note, a 2003 study called Counting Blessings vs. Burdens by University Professors Robert A. Emmons and Michael E. McCullough, had sick patients keep a gratitude journal. By the end, 16% of patients had less symptoms and 10% of them had less pain. The patients were more willing to exercise and much more motivated in their recovery. “The practice of gratitude can have dramatic and lasting effects in a person’s life,” said Emmons.

More and more evidence is being discovered every day on the link between gratitude and your health.

Do you think 15 minutes a day of journaling, meditating, praying, or otherwise practicing gratitude would be worth it for your health?

I’ll leave you with this quote:
When you actively practice gratitude, where you concentrate on not just thinking about it but write things down, you go through the day looking for it.” – Oprah while interviewing Brené Brown.

Related Links and Citations:

https://www.health.harvard.edu/healthbeat/giving-thanks-can-make-you-happier
https://www.psychologytoday.com/ca/blog/what-mentally-strong-people-dont-do/201504/7-scientifically-proven-benefits-gratitude
https://www.psychologytoday.com/ca/basics/stress
https://www.consciouslifestylemag.com/benefits-of-gratitude-research/
https://health.ucdavis.edu/medicalcenter/features/2015-2016/11/20151125_gratitude.html
https://www.inc.com/jessica-stillman/the-amazing-way-gratitude-rewires-your-brain-for-happiness.html
https://gratefulness.org/resource/brene-brown-on-joy-and-gratitude/

Did you find this valuable? Sign up for my weekly newsletter all about health – from body to money. Think of it like ‘Holistic Insurance’.

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What Happens When You Apply for Life Insurance?

Meet your Advisor!

The Insurance process can seem intimidating when you’re not sure what to expect. From questions about your finances to very personal health questions and tests. What happens when you apply for Life Insurance?

It can be overwhelming to start the process if you don’t know how it works!

Here, we know that Education is Power.

This short cartoon will walk you through what happens when you apply for life insurance.

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What happens when you apply for life insurance?

Depending on a number of factors, getting an insurance plan can be almost instant or take a few months. There isn’t much you can do to effect the timeline – it’ll depend on the Insurance Company you apply with, the type of insurance plan you get (or more accurately, how big of a plan you get), and your medical history, as well as a number of other factors.

Getting Insurance is meant to be a simple process but, when dealing with anything health related, there can always be complications. So, let’s walk through the steps of how the situation will ideally pan out. Remember, it may not work out exactly like this, but this is the typical process:

1. Meet your Advisor

In the first meeting with your Advisor, they’ll ask you about your goals, finances and figure out what you need.

2. Advisor finds options for you

Your Advisor will take the information you gave them and go to the drawing board. If you’re working with a Broker (like myself), they’ll be looking different plans from multiple companies. They may have a plan in mind already and be able to start the process in the same meeting, but they’ll likely have to come back for a second appointment.

3. Pick the Plan

Your agent will show you the plans they have in mind (they should be giving you a couple of options) and help you pick a plan that works just right for you.

4. Apply

Then, you’ll apply! You’ll be asked questions abut your health, habits, job and income. Be honest with your Advisor! The questions will be very personal about your current and past health, (likely) as well as the health of your close family members. Your job and income will determine how much you can have coverage for – this is by law and not necessarily dependent on the Insurance Company.

5. Medical

Whether it’s life or disability insurance, you’ll likely have to go through a medical. How that works will depend on many factors including the Insurance Company you’re applying with, health history, habits, etc. It can range from a phone interview to blood and urine samples or even special scans and tests. The Company needs to determine what they’re willing to cover you for with all the ‘information on the table’ so to speak.

6. Pay your First Bill

Once you’re approved, you’ll have to pay your first bill (or premium) to start the coverage. You might give them a credit card to charge when you first apply or wait until they’ve accepted your application to pay – again, this is determined by a number of factors including the Insurance Company that you’re applying with and personal preference.

And that’s all there is to it! Your agent should walk you through the process and help with any hiccups along the way, making the process easier for you.

Insurance is an incredibly important step towards financial independence and preparing for the emergency situations that life can bring. You won’t know how valuable a plan is until you need it. But,  it won’t happen to you, right? These things always seem to happen to other people, so make sure your friends and family sit down with an Insurance Agent or Broker! 

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3 Easy Savings Plan Tips for Beginners

Today, we’re going to talk about savings plans for beginners!

If you struggle to save money, you’re in the right place. These 3 savings plan tips for beginners are easy to use!

I have been using these for 5 years now. It has helped us out of some really tight spots and got us on a 3-week vacation to Australia.

Look at that beach!

It’s worked so well for us, I thought I’d share it with you. Here are 3 Savings Plan tips for beginners!

The first tip is: SAVE ONCE A WEEK, NOT ONCE A MONTH.

The reason I’m suggesting so often is because bite sized chunks are a lot more manageable. Let’s use $100 as an example. What I’m suggesting is that, rather than putting aside $100 a month, put aside $25 a week. It’s a small enough amount of money that you likely won’t notice it leaving your account, but still adds up to your ultimate goal. Ideally, you’ll be putting aside a lot more than that, but $100 is a good place to start!

The second tip is: AUTOMATE IT!

Unless you’re a total Type A Superstar, you’re not going to remember to log into your banking app once a week and transfer that money over! Let’s just automate it and get the banking app to do it for you. Have that amount set to go at the same time/same day every single week.

If you know what your goal is – maybe you’re saving for a big trip that you know will cost $5,000, here’s where you’ll figure out exactly how long it’ll take you to save up enough. 

If you’re saving $100 a month, it would take you just shy of 4 years to save up for that trip. Now, set that expectation for yourself and be dedicated to putting the $25 a week aside with your automatic transfers set to go for the next 4 years. Option 2 is taking another look at your budget to see if you could bump up the amount you’re saving, even if it’s just by a bit! But it helps to know how long it’ll take up front, so you don’t get discouraged when it’s not happened as fast as you thought.

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The third and final tip is: KEEP IT OFF YOUR CARD.

DO NOT make your savings account accessible by debit (or any other) card. It’s way too easy to see something shiny or put a couple small expenses on that account. But we’ve all been to Costco and know how quickly $20 here and there can add up! So, make it easier on yourself and don’t have easy access to the account.

We’ve found a Tax Free Savings Account (TFSA) worked best for us.

It doesn’t offer you a card to make deposits or withdrawals by and is not the type of account to use if you’re planning on putting a bit of money in and taking a bit out. It is, however, fantastic for saving for goals or emergencies! You also don’t get taxed on the interest you make by keeping your money in the account – that’s where the Tax-Free part comes into play. In a TFSA, you would earn more interest as compared to a savings account over the long term, and the tax-free nature of the TFSA earnings means you’ll keep more in your pocket. Click here to learn more about a TFSA!

It’s been a great option for us and maybe for you too. Please make sure you sit down with a Financial Planner or representative from your bank to see if a TFSA would be a good option for you and to learn about the rules that come with that type of account.

The information in this post is based off of my personal experience and opinions. It is for general information only, so do contact a professional who is able to look at and advise your specific needs before making any decisions. 

Those are the 3 tips that we’ve been using for our own savings plan! We started about 5 years ago and having an emergency plan/savings fund that wasn’t stressful to contribute to has made a big difference for us. These beginner tips have worked great for us and I really hope they work for you as well!

Save the Planet From Your Office

There has been SO MUCH talk in the last few weeks about climate change and going green. More and more people are becoming conscious of the importance of sustainability and becoming eco-friendly. Some people have become super conscious of it! See 4 years of trash in a mason jar. A lot of businesses owners are learning that going green is even good for business. So, how can a company Go Green?

Maybe you can’t be committed to the point of a mason jar of trash for your office, but what other ways could your company go green? And how could going green benefit companies?

Let’s talk about how going green could be good for your business!

1. Hold video meetings

How does that make a difference? Well, how much do you drive just to meet a client for a half hour to hour long meeting? You can save fossil fuels and time in the same go!

2. Plan your days to drive less

This one ties into the one before AND you’ve probably heard it a thousand times by now. But driving less makes a big difference.

3. Sign online

How much paper and ink would you save if you didn’t have to print every time you needed a client to sign off? There are a lot of apps that can help with this! It’s also really helpful to have your paperwork on your laptop or smart phone if you regularly leave the office.

4. Work from PDFs

Again, there are so many programs that you can use to fill out forms without printing them off. Let’s be honest, how often do you actually need a paper copy? It’s an adjustment, but it’s worth it. Could you imagine how much easier things would be if you didn’t have to fight with your printer, wait to get home to use your printer, or dealing running out of ink?

5. Research your printer

Tying into the last point on printing, research how often you’ll have to replace your printer ink and how much it’ll cost before you buy a printer. I’m sure most of us have ended up in the situation where it costs just a few bucks more to buy a brand new printer that comes with ink than it is to buy new ink for your printer. How ridiculous is that?
Another option is re-using your ink cartridges. I’ve saved a lot of money doing that and the only draw-back is that you have to go to the store twice – once to drop them off and another to pick up. If you don’t print that much, why not just get what you need printed done at a store?

6. Get your computer fixed

How much more common is it to look at a new laptop once yours is over 2 years old and causing problems, than it is to just buy a new one? It might not make sense for your to fix yours and you really do need to buy a new one, but it’s still worth mentioning!

7. Avoid brochures

When you get a brochure from someone, how often do you actually keep it? Most of us look it over and then it either goes straight to the trash or in a junk drawer until you don’t feel bad about trashing it. Chances are, that’s what’s happening to the brochures you’re handing out too – no matter how beautiful they are. The alternative is emailing your brochure as a PDF.

8. Recycle

One cannot make a blog post about going green without mentioning recycling! But it should be one of the lowest items on your list. 91% OF WHAT YOU RECYCLE WILL END UP IN THE LANDFILL. Yes… out of all that effort you put in, only 9% of what you recycle will actually make a difference. Instead of recycling, talk about being conscious with how much waste your office produces.

9. Print on recycled paper

If you HAVE to print, print on recycled paper. It doesn’t cost much more than brand new paper!

10. Take pictures of business cards

I’ve accepted about 5 business cards in the last 6 months. Chances are, if you accept them, they’ll end up in a pile somewhere. Are you really going to search through the pile to find that business card from the graphic designer you had a quick chat with at a networking meeting? Probably not. BUT if you upload a photo of the business card into an app, all you have to do is search “Graphic Designer”. You can even add specific info on that person so you know you’re referring the right type of client. It’s a WIN-WIN-WIN!

11. Watch your gifts

Giving gifts like pens, notebooks, and little gadgets to a client or at an event can be a really nice thought. But, if someone gave you a little notebook with their company name all over it, would you consider it junk? Now, this can go either way. I’ve definitely gone back to the same office to renew my auto-insurance because they give out really nice pens. Most of the time, the other stuff is going straight into the garbage. And that’s not great for the environment or your marketing budget. Maybe it’s worth investing in some better swag and being more choosey with who you give it too!

Have more ideas on going green at the office? Add them in the comments! Let’s make this as interactive and helpful as possible ☕

 

 

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What Should I Know About Mortgage Insurance?

This post was made in September 2019 and is specific to Canadian policies and information. It is intended solely for the personal non-commercial use of the user who accepts full responsibility for its use. While I have taken precaution to ensure that the content of this site is both current and accurate, errors can occur.
The information contained in this site is general in nature and should not be considered to be legal, tax, accounting, consulting or any other professional advice. In all cases you should consult with professional advisors familiar with your particular factual situation for advice concerning specific matters before making any decisions.

Let’s go ahead and start this from the very beginning. What IS mortgage insurance?

Mortgage Insurance helps you pay off your mortgage if you pass away. It could also pay your monthly mortgage fee if you’re not able to work for a period of time. It’s an optional coverage that you’d buy either through the bank when you get your mortgage or through an Insurance agent. If you’re familiar, Mortgage Insurance is like Term Insurance.

No one wants to think about it but, if you pass away, who will pay your mortgage?

If you’re single, the bill will probably go to a family member who would, likely, have to cover your mortgage payments until they’re able to sell your home. If you’re married, will your spouse be able to cover the mortgage and all other expenses without your income? Will they need to take time off of work after you pass? In that case, your family would lose both incomes until your spouse is ready to go back to work. Keep in mind, your payments will still be required if you’re not able to bring home a paycheck! 

And that, my friends, is what mortgage insurance covers. 

So, what’s the difference between buying from the bank vs. an insurance advisor?

Insurance from the bank is typically more convenient. It (usually) gets taken out of your account with the mortgage so you don’t have to think of an extra bill payment. Also, you can sign up for it as you’re dealing with the mortgage approval.

While personal insurance doesn’t offer those conveniences, it has plenty of other benefits you need to consider. To start, you’ll know what you’re covered for before you make a claim. When you buy an insurance policy, it goes through Underwriting. That’s a process where a professional looks at your application, medical history, etc. and decides if the company will issue you a policy. You can be approved or denied. Or, you could be approved except for XYZ – meaning you’re covered, UNLESS you pass away from a returning illness, hereditary health conditions, etc.
You want them to do this when you apply to give yourself options before you need to use the insurance.

On the contrary, Mortgage Insurance offered through a bank is, generally speaking, a simple questionnaire approving most people on the spot. However, they’ll wait until you make a claim before they send it to the underwriter. That means you won’t know if there’s an exception to what you’re covered for until it’s too late.

With personal insurance, you own the policy. You keep it even when you move or pay off your mortgage. It’ll pay the Life Insurance Benefit directly to your family (or estate) if you pass away. Your family can use the money to pay off the mortgage or chose to split it between the mortgage and another unforeseen expense.

Life Insurance through the bank will be paid directly to the bank and used to pay off your mortgage.

You’ll typically get comparable rates for an Insurance Policy from the Bank as an Insurance Agent.

There are plenty of other things to know about mortgage insurance (good and bad) so I suggest sitting down with a professional to ask questions before you chose a policy. Always make sure you understand what the contract says. If your situation doesn’t match the criteria and definitions in the contract, you will not be paid out.

These are some good questions to ask:

  • If/When I pass away, who will the money go to?
  • Does the benefit ever change?
  • If I’m too hurt or sick to go to work (make an income) for a period of time, will this plan offer me any benefits?
    • If the answer is yes, ask what the “Definition of Disability” is. You’re essentially asking, “How badly do I have to be hurt before they’ll pay me?”
    • Ask how long you’ll have to be off work before they start to pay you.
  • Who is covered under this plan? If you and your partner buy a home, it may be only the Primary Applicant who’s covered. But what if something happened to the other partner?
  • If I make changes to my mortgage, will this policy be canceled, or will it move with me even if I change lenders?
  • When will they decide if I qualify for the insurance policy I’ve chosen?
    I realize that question sounds redundant but many policies, especially the ones with few questions and approve you right away, aren’t looked at by the Underwriter (the person who decides if you qualify and what the insurance company will cover you for) until you’re asking for the money i.e. making a claim. This is a very important question.

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How to Know if You’re Talking to the Right Insurance Agent

There’s one simple mistake that a lot of us make when we start looking into an insurance policy – we think each insurance agent sells all kinds of insurance. And us agent aren’t great at clearing this up from the beginning. So, here’s a very basic explanation on how it works!

There are 2 categories of insurance: People (Personal) and Things (General).

General Insurance Agents can cover you for much more than just things, but the concept makes it easy to understand. They sell car insurance, house insurance, liability coverage, prepare for expensive emergencies, etc. They’ll help you cover things you can touch, expensive emergency situations (like hotel expenses after a house fire), and situations where you could be liable. There are levels of Insurance licenses the agent will be in depending on how many programs they choose to take. The more programs they take, the more coverage they can offer you.

Personal Insurance Agents can help you protect your ability to make money. If you’re too hurt or sick to work, or if you pass away, you’re not bringing in an income. Taking care of yourself while you’re disabled or paying for funeral expenses will also COST money. Personal Insurance Agents look at what you already qualify for – from Government Benefits to Employee Benefit Plans –  and find an insurance plan that works for you.

Insurance agents want to help. So if you’re ever confused on whether you’re talking to the right ‘type’ of agent, just ask them!

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