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!

Government Benefits for Self-Employed Canadians

government benefits for self employed canadians

When you leave the 9-5 world, you leave behind a lot of securities that come with it. One of those securities for self-employed Canadians is Government Benefits. I’m talking about Canada Pension Plan (CPP), WorkSafe BC (WCB), and Employment Insurance (EI). There are several important things to know about what you qualify for if you’re hurt as a small business owner in Canada and we’re going to cover them today.

Being a tricky subject to understand, we broke this blog post down. You can read the "I'm totally new to this" or scroll down for the "I'm looking for specifics".

The "I'm totally new to this" version

This information is current as of December 2019. All policies and Government programs are subject to change, so please click on the links provided to ensure the information you’re receiving is up to date.

When you leave the 9-5 world, you leave behind a lot of securities that come with it. One of those securities is Government Benefits. I’m talking about Canada Pension Plan (CPP), WorkSafe BC (WCB), and Employment Insurance (EI). There are several important things to know about Government Benefits as a self-employed Canadian and we’re going to cover them today.

Assuming that, at some point in your life you’ve worked for a legitimate company in Canada for a length of time, you probably qualify for Canada Pension Plan (CPP) Disability.

You don’t want to qualify for this benefit. Those who qualify are permanently disabled and likely to die from their condition. Plus, the benefit is pretty well equal to half the rent of a 1 bedroom apartment in Vancouver… it’s not enough to live off of.

If you pass away and qualify for CPP, your family can get up to $2,500 for it. These benefits aren’t designed to be enough to help a family get by. They’re meant to take the edge off, but not to solve the problem. Making a proper plan is up to you.

You’re also responsible for paying your full CCP bill yourself. When you’re an employee, your boss would’ve paid for half the bill and taken it off your paycheque. As a self-employed person, you must pay the full amount yourself, up to a max of $5,497.80 a year. For more information on this, please contact your accountant or visit the CPP info page. 

WorkSafe BC (WCB) isn’t automatic when you’re self-employed.

It’s optional for self-employed people but mandatory once you have an employee.

If you qualify, WorkSafe BC would cover 90% of your wages up to a maximum of $1,151.50 per week that you’re on the claim ($1,122.48/week updated Feb 25, 2020).

For the first 10 weeks you’re getting a benefit, the benefit amount will be based on your average income from the last 3 months. If you’ve just had a slow season, it could be a small benefit.

If you’re still on the claim after the 10 weeks, your benefit will change to 90% of what your income was last year. That’ll be based on your last tax return.

The 3rd Government benefit that automatically goes away when you’re a self-employed Canadian is Employee Insurance (EI).

This one is a little bit tricky because you have the option to pay into it but, once you start, you can’t stop. You must pay into it as long as you’re self-employed, even if you make a change to the nature of your self-employment. If you’ve never received a benefit from E.I., you might be able to cancel but under very specific criteria. For self-employed women who are expecting to take maternity leave more than once, this may be a good option.

The benefit is about 55% of your income with a $573 per week maximum benefit ($547 Updated Feb 25, 2020).  If you’re disabled, they will pay you for a maximum of 15 weeks but then you’re on your own.

These benefits will depend on how you’ve structured your company.

If you’ve set it up so that you’re an employee of your company, you’d have the same access to WCB, EI and other employment benefits that your employees have.

Look at what your benefit would be and talk to a professional to see if that’d be enough for you.

At this point, you might be thinking, “With CPP, I’ll only get a benefit if things are really bad. WCB will only cover me if I’m hurt at work. And E.I. pays half my income and only for a short amount of time. What am I supposed to do?”

The answer is self-financing or get disability insurance.

Self-financing is what it sounds. If you have enough income and don’t plan to become disabled for a long period of time, you can save like a squirrel and use that money if something happens.

Disability Insurance is another great option. It’ll cover you whether you’re at work or not and you can customize it as specific as you’d like. You might be surprised by how affordable it is. For more information on that, book a quick call with us.

The bottom line, self-employed people have a lot of flexibility in what kind of coverage they get if they become disabled, but they’re responsible for setting it up themselves.

Remember, plans like this need to be set up BEFORE you become disabled.

Government benefits are not automatic as a self-employed Canadian, so be sure to do your research and talk to a professional.

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

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

The "I'm looking for specifics" version

This information is current as of December 2019. All policies and Government programs are subject to change, so please click on the links provided to ensure the information you’re receiving is up to date.

When you leave the 9-5 world, you leave behind a lot of securities that come with it. One of those securities is Government Benefits. I’m talking about Canada Pension Plan (CPP), WorkSafe BC (WCB), and Employment Insurance (EI). There are several important things to know about Government Benefits as a self-employed Canadian and we’re going to cover them today.

Assuming that, at some point in your life you’ve worked for a legitimate company in Canada for a length of time, you probably qualify for Canada Pension Plan (CPP) Disability.

You don’t want to qualify for this benefit. Those who qualify are permanently disabled and likely to die from their condition. Plus, the benefit is pretty well equal to half the rent of a 1 bedroom apartment in Vancouver… it’s not enough to live off.

If you pass away and qualify for CPP, your family can receive a maximum $2,500 death benefit. Your partner and children might also get survivor benefits and special education grants as well. These benefits aren’t designed to be enough for a family to get by. They’re meant to help, but not to solve the problem. Making a proper plan is up to you.

You’re also responsible for paying your full CPP bill yourself. At tax season, CPP will bill you for what, in an employee position, your boss would’ve taken off each paycheque. If you make more than $3,500, you must pay into CPP. That bill is 10.2% of your NET income. As an employee, your boss paid for half and you paid for the other half. As a self-employed person, you must pay the full 10.2% on your own, up to a max of $5,497.80. For more information on this, please contact your accountant or visit the CPP Information Page. 

WorkSafe BC (WCB) isn’t automatic when you’re self-employed.

It’s optional for self-employed people but mandatory once you have an employee. Depending on how big you anticipate your company growing and the way you’ve structured your own employment – whether you’re an employee of your company, sole-proprietor, etc. – it might make more sense to get disability insurance for yourself.

If you qualify, WBC would cover 90% of your wages up to a GROSS income of $87,417.00 ($84,800 updated Feb 25. 2020). It works out to a maximum of $1,150.50 per week benefit that you could receive while on the claim ($1,122.48/week updated Feb 25, 2020)

For the first 10 weeks, your benefit amount will depend on the average income you made in the last 3 months. If you’ve just had a slow season, it’ll be reflected in your benefit. If you’re still on the claim after the 10 weeks, the amount will change to 90% of your NET annual income. They’ll base that number off of what income you claimed during tax season last year and you must be able to prove it.

The 3rd Government benefit that automatically goes away when you’re a self-employed Canadian is Employee Insurance (EI).

This one is a little bit tricky because you have the option to pay into it but, once you set it up, you can’t stop. You must keep paying your E.I. premium as long as you’re self-employed, regardless of if you make a change to the nature of your self-employment. If you’ve never received a benefit from it while being self-employed, you might be able to cancel but under very specific criteria. For self-employed women who are expecting to take maternity leave more than once, this may be a good option.

The benefit is 55% of your income to a maximum of $54,200 annual income ($51,700 updated Feb 25, 2020). That works out to be $573 per week maximum benefit ($547 updated Feb 25, 2020). With disability or unemployment claims, they’ll pay you for a maximum of 15 weeks. After that, you will stop receiving a benefit.

Again, these benefits will depend on how you’ve structured your company.

If you set it up so that you’re an employee of your company, you’d have the same access to WCB, EI and other employment benefits that your employees have.

Talk to a professional to see what your maximum benefit would be with each of these programs to determine whether it’d be enough for you.

Here’s what you might be thinking at this point, “With CPP, I’ll only get a benefit if things are really bad. WCB will only cover me if I’m hurt at work. And E.I. is a short-term solution. What am I supposed to do?”

The answer is self-financing or getting disability insurance.

Self-financing is what it sounds. If you have enough income and don’t plan to become disabled for a long period of time, you can save like a squirrel and use that money if something happens.

Disability Insurance is another great option. It’ll cover you whether you’re at work or not and you can customize it as specific as you’d like. You might be surprised by how affordable it is. For more information on that, book a quick call with us.

The bottom line, self-employed people have a lot of flexibility in what kind of coverage they can get if they become disabled, but they’re responsible for setting it up themselves.

Remember, plans like this need to be set up BEFORE you become disabled.

Government benefits are not automatic as a self-employed Canadian, so be sure to do your research and talk to a professional.

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

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

.