Ginsler Wealth Named Excellence Awardee for Holistic Advisory Team of the Year

Ginsler Wealth is pleased to have been named an Excellence Awardee in the category of “Holistic Advisory Team of the Year” for the 2024 Wealth Professional Awards.

This award recognizes the advisory team that has best displayed excellence over the last 12 months offering a full suite of services including, but not limited to, investments, tax and estate planning, insurance advisory, succession planning, etc.

The criteria for this award include:
– Overall client service and relationship management
– Ability to demonstrate the variety of products and services available to clients
– Industry reputation

“We are very pleased to be named an Excellence Awardee for the second year in a row,” said Brian Ginsler, CEO of Ginsler Wealth. “I am especially pleased that this year it was in recognition of the whole Ginsler Wealth team’s unlimited focus on delivering the best wealth management experience to our clients”.

For 10 years now, the annual Wealth Professional Awards (WPAs) has been recognized as the leading independent awards program for the wealth management and financial planning profession.* Winners will be revealed at the celebratory awards show on June 6, 2024 at the Liberty Grand, Toronto. We would like to thank Wealth Professional and wish the best of luck to the other nominees!

 

*According to Wealth Professional’s website: https://wealthprofessionalawards.ca/

Federal Budget Breakdown with Ali Spinner on The Unlimited Podcast

On Tuesday, April 16, the government of Canada revealed its 2024 Federal Budget with major changes that impact investors, savers and business builders – most significantly of which being an increase to the capital gains inclusion rate.

In this “breaking news” episode of The Unlimited Podcast, we bring back the “Tax Ninja”, Alexandra (Ali) Spinner, to help break down the key changes and provide some guidance for immediate and long-term actions and plans. Ali can also be seen discussing the Federal Budget changes on BNN Bloomberg.

Key changes covered include:

  1. The increase to the capital gains inclusion rate
  2. The increase to the Lifetime Capital Gains Exemption
  3. The introduction of the Canadian Entrepreneurs Incentive
  4. Changes to the Alternative Minimum Tax (AMT)

Ali is a Partner in Crowe Soberman’s Tax Group, a member of the firm’s Management Committee, and leader of the High-Net-Worth tax practice. Ali has more than 20 years of experience in public accounting and tax and estate planning. Her practice focuses on helping wealthy families and high-performance professionals structure their affairs in a tax-efficient manner. Ali’s broad technical expertise includes domestic, cross-border, and international tax matters for individuals, trusts, estates, and corporations. She is experienced in complex estate and trust planning, post-mortem planning, corporate reorganizations, and the preparation of Canadian tax returns and compliance forms. In 2022, she was elected as a Fellow of the Chartered Professional Accountants of Ontario.

This episode can be found here or find us in your favourite podcasting app, including Apple Podcasts, Spotify, Google Podcasts and Amazon Music.

If you like what you hear, please don’t hesitate to rate us kindly. And if there are particular topics you’d like covered, please let us know.

Ginsler Wealth First Quarter 2024 Client Letter – Free Money Edition

(An audio version of this letter can now be found as Episode 37 of The Unlimited Podcast by Ginsler Wealth. Use the link provided or find us on your favourite podcast app.)

To Ginsler Wealth’s Clients:

You may have heard the joke about two economists walking down the street and seeing a $20 bill lying on the sidewalk. The first economist says, “Look at that $20 bill.” The second says, “That can’t really be a $20 bill lying there, because if it were, someone would have picked it up already.” So they walk on, leaving the $20 bill undisturbed.[i]

The notion above is that there can’t be “free money” lying around in plain sight. The “markets” are efficient and opportunities like the above cannot exist.

I beg to differ.

A few weeks ago, I was in a long line at Burger Shack, our family’s favourite burger joint, to pick up food for dinner. There were at least six people ahead of me placing and collecting their orders. As I waited for my turn to order, my eyes gazed at the floor directly in front of the cashier and I saw a loonie and a quarter lying in plain sight on the ground.

With that old economist joke in my head, I watched in disbelief as person after person completely missed, or ignored (?), the FREE MONEY lying on the ground.

When it was my turn to order, I promptly reached down and picked up the free money, and placed it in the tip jar for the staff.

Clearly, $1.25 is not a large sum of money, but if you can find $1.25 in many places, it can add up. At Ginsler Wealth, we believe a critical part of our job, is to find you “free money”.

THE SEARCH FOR FREE MONEY

Investing is hard. What I have learned in twenty-five years in the business is that you should jump at opportunities to earn a risk-free return (the investing equivalent of “free money”). As we oversee your finances and investments, here are examples of what we are doing, and have done, to seek out free money for your benefit.

  1. Tax and Investment Holding Structuring

The first step is to ensure your family has the appropriate tax structure in place to conduct your activities – with the goal of the highest after-tax investment and financial outcomes. For example, we have helped many of you set up holding companies and family trusts. These structures aim to either defer the payment of taxes or reduce a family’s overall tax burden. Similarly, simply making use of government-provided registered accounts (like the RRSP, TFSA, RESPs, etc.) can save a dramatic amount of taxes over time. In the case of the RESP[ii], the government literally gives you “free money” when you contribute. When you structure, or maximize the use of registered accounts, to defer or save taxes, the result is money you get to keep instead of handing it over to the CRA.

  1. Negotiating Fee Reductions

We are very conscious of the investment management fees you pay, and we strive to keep them as low as possible. Once we have determined that an investment strategy is a suitable addition to our roster, where possible, we go to work negotiating the fee structure (and sometimes other terms). Our investing scale often results in our clients paying a substantially discounted management fee. For example, with one of the strategies we use, the management fee is reduced by 0.75% for Ginsler Wealth clients. This equates to an additional “risk free” 0.75% return on this investment in your portfolio.[iii] This fee reduction has, on average, represented an annual 8% enhancement to the return on that investment over the past 3 years. We utilize several strategies with discounted fee structures to benefit our clients.

  1. Taking Advantage of Discounted Dividend Reinvestment Programs (“DRIPs”)

Similar to a fee reduction, we love finding investment funds than enable our clients to automatically reinvest monthly distributions at a discount to their market value. A number of the strategies we use offer a 2% or 3% reinvestment discount. This means that you earn an immediate, risk-free return on each distribution that is reinvested. Like the small change on the Burger Shack floor, it may not seem like a lot of money, but—as the chart below shows—if you can collect small amounts every month in perpetuity, they can add up.

 

In addition, certain strategies we use will pay distributions, not in the form of income (which is taxable), but rather as a “return of capital”[iv] (ROC) which are not taxable in the year received. Instead, the investor will incur a higher, but more favourably-taxed, capital gain at a later point when the holding is sold. This ROC acts as a tax deferral and tax reduction mechanism. Which leads us into the next item below…

  1. Re-characterizing Income into Dividends or Capital Gains

As you likely know, interest income is taxed at the highest rates in Canada. That is why, in addition to the prospect for high returns, investing in equities—whose returns come in the form of capital gains only when sold—tends to be the most tax-effective way to grow wealth inside a taxable investment account. But for those who wish to invest in other potentially less-volatile or less-risky asset classes for a portion of their portfolios, we have found a few select investment strategies that either pay dividends instead of interest, or have a legacy legal structure that enables all returns of any type to be treated as capital gains. The above strategies can potentially reduce your taxes between 25%-50% on each dollar of income. Put another way, a 5% return on the aforementioned tax-advantaged strategy would be equivalent to a regular bond portfolio that returns 8% in the form of income. While 8% sounds better than 5%, ultimately, the net return after taxes is the true measure of portfolio performance and our effectiveness as portfolio managers.

  1. The Use of Whole Life Insurance, Especially Inside a Corporation

Whole life insurance is a permanent insurance policy that grows in value over time by participating in distributions from the insurance company’s pool of investments. This type of policy offers a significant opportunity to boost wealth and estate value, for two key reasons:

  1. The policy’s value grows tax-free and is typically distributed tax-free[v] upon death, and
  2. When held within a corporation, the proceeds can be paid to your estate on a tax-free basis[vi] without being subject to additional taxes like most other corporate assets.

For someone with a corporation, the additional after-tax value of dollars invested in a whole life insurance policy can be potentially double what could be achieved without the use of insurance.[vii] Now that’s what I call “free money”!

For a deep dive into whole life insurance, along with a more concrete example of the above, please listen to the latest episode of The Unlimited Podcast—Insurance 201 with Sterling Park.

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Why am I telling you about all this? First, we want to ensure you know what we are doing and how we are thinking around meeting your long-term wealth and investing goals. Second, we have always been clear that we don’t have a crystal ball and can’t predict the future. To mitigate this limitation (which we believe all investors and forecasters have, whether they admit it or not), we want to stack the deck in your favour by taking advantage of as much risk-free money and opportunities that we can find. This approach is akin to shifting the starting line of a race closer to the finish line.

Now, if only I could get that line at Burger Shack moving a bit more quickly!

 

THE ONLY THING “LIMITED” ABOUT YOUR GINSLER WEALTH EXPERIENCE…

 

Like most other businesses, Ginsler Wealth can be found on popular social media platforms including LinkedIn, Instagram, Facebook and X (formerly, Twitter). And of course, we have The Unlimited Podcast that is available to all as well. While we are active on those platforms, over the past few months I have realized that I have a lot I would like to share with our clients and closest “friends of the firm”, but not necessarily with our large number of public followers. And I wanted to do so in a way that would not bombard your email Inboxes.

So contrary to prevailing social media wisdom, we have created @ginslerwealthx, a private X account, to provide you with inside access to what we are thinking about and working on – on your behalf. Please note that while the account is private, once you follow it (and we let you in!), you will be able to see the other Followers and vice versa.

Think of it as the only thing “limited” about your Ginsler Wealth experience.

—————–

Finally, I would like to congratulate my colleague Safal Bhattarai—who many of you know well—on becoming registered by our Regulator, the Ontario Securities Commission, as a Portfolio Manager[viii], and as such his promotion to Portfolio Manager at Ginsler Wealth.

 

Thank you for your trust, support, and confidence. We are available 24/7 should you need us.

Sincerely,

Brian singnature

Brian Ginsler
President & CEO

 

 

 

 

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[i] Text taken from: https://www.cbsnews.com/news/efficient-market-thinking-is-inefficient/

[ii] Registered Education Savings Plan.

[iii] The additional 0.75% return is “risk free” because it is a direct subsidy by the manager and does not depend on the underlying performance of the investments themselves, which of course always carry some level of risk.

[iv] This return of capital (ROC) may be a full (i.e., 100%) or a partial return of capital, depending on the fund.

[v] The tax-free nature of whole life insurance may not be absolute under certain circumstances, including in shorter duration insurance policies. This letter is meant only to provide a high-level overview of the benefits of whole life insurance and is not comprehensive. Please speak with Ginsler Wealth Financial Services Inc., a FSRA licensed insurance agency, or your own insurance advisors for more specific details.

[vi] Ibid.

[vii] The precise outcome of utilizing these types of insurance policies will depend on the age, gender, and medical profile of the insured(s) at time of entering into the policy and the age of death of the unsured(s) amongst other factors. Talk to Ginsler Wealth Financial Services Inc. or you own insurance advisor for more precise details.

[viii] Technically, the registration category is called “Advising Representative” but is known in the industry as a “Portfolio Manager” registration.

Insurance 201 with Sterling Park on The Unlimited Podcast

As a follow-up to Episode 33: Insurance 101 with Simon Kay, this episode features Zak Goldman and Jonah Mayles from Sterling Park providing an Insurance 201 lesson for our listeners, with a focus on the tax and wealth creation advantages of whole life insurance.

Whole life insurance is a permanent insurance policy that grows in value over time by participating in distributions from the insurance company’s pool of investments. This type of policy offers a significant opportunity to boost wealth and estate value, for two key reasons:

  1. The policy’s value grows tax-free and is typically distributed tax-free[i] upon death, and
  2. When held within a corporation, the proceeds can be paid to your estate on a tax-free basis[ii] without being subject to additional taxes like most other corporate assets.

For someone with a corporation, the additional after-tax value of dollars invested in a whole life insurance policy can be potentially double what could be achieved without the use of insurance.[iii]

Brian and the “Dynamic Duo” of Zak and Jonah explain whole life insurance and how it works, compare the after-tax result of using insurance vs. not, and provide insight into how to know if an insurance policy is right for you.

Zak is a founding partner of Sterling Park. He has advised affluent clients and business owners for over 20 years. He holds the Family Enterprise Advisor™ (FEA) designation and an MBA from the Rotman School of Business at the University of Toronto.

Jonah is a partner at Sterling Park and is the tax, legal and estate planning guru in the firm. Before joining Sterling Park, Jonah was a tax lawyer at Fraser Milner Casgrain and Torkin Manes where his practice focused on business succession planning, estate planning, advising on and drafting family trusts and structuring/implementing tax-efficient sales and purchases of businesses.

You can listen to this episode here or find us in your favourite podcasting app, including Apple Podcasts, Spotify, Google Podcasts and Amazon Music.

 

[i] The tax-free nature of whole life insurance may not be absolute under certain circumstances, including in shorter duration insurance policies. This letter is meant only to provide a high-level overview of the benefits of whole life insurance and is not comprehensive. Please speak with Ginsler Wealth Financial Services Inc., a FSRA licensed insurance agency, or your own insurance advisors for more specific details.

[ii] Ibid.

[iii] The precise outcome of utilizing these types of insurance policies will depend on the age, gender and medical profile of the insured(s) at time of entering into the policy and the age of death of the unsured(s) amongst other factors. Talk to Ginsler Wealth Financial Services Inc. or you own insurance advisor for more precise details.

This episode is brought to you by Ginsler Wealth Financial Services Inc., a FSRAO licensed insurance agent corporation. Nothing in this podcast should be deemed to be insurance or financial advice, and is for informational purposes only.

Insurance 101 with Simon Kay on The Unlimited Podcast

As long as humans have been taking risks, we have been looking for ways to mitigate those risks. Insurance, while a very popular risk transfer tool, can be complex and easily misunderstood. On this episode of The Unlimited Podcast, Brian speaks with Simon Kay of IPS insurance, who provides an Insurance 101 lesson, focusing on insurance for individuals and families.

Brian and Simon discuss different types of insurance, how to determine how much insurance you need, individual vs. group coverage, and more.

Simon is the President of IPS Insurance, a specialized insurance advisory firm with a very unique private underwriting approach to determine insurability. Simon is an insurance industry veteran, having started his insurance career back in 1988 as an insurance agent at London Life. More recently, Simon is a founding investor in Fairgrounds, a free-to-join racquet club focusing on Pickelball and Padel – some of the fastest growing sports in the word.

You can listen to this episode here or find us in your favourite podcasting app, including Apple Podcasts, Spotify, Google Podcasts and Amazon Music.

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And COMING SOON…The Unlimited Podcast goes back to school for Insurance 201, where we explore the use of insurance for tax-efficient wealth accumulation.

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This episode is brought to you by Ginsler Wealth Financial Services Inc., a FSRAO licensed insurance agent corporation. Nothing in this podcast should be deemed to be insurance or financial advice, and is for informational purposes only.

The original article for Brian’s summary of the history of insurance can be found here.

The Wisest Investment with Robin Taub on The Unlimited Podcast

November is Financial Literacy month in Canada, so as part of Ginsler Wealth’s ongoing efforts to promote financial literacy, Brian speaks with Robin Taub, CPA, CA, the author of The Wisest Investment: Teaching Your Kids to Be Responsible, Independent and Money-Smart for Life.

Brian and Robin discuss her path to writing the book on financial literacy, the 5 Pillars of Money, her 11 Healthy Habits of Financial Management, and how parents can overcome the challenges of teaching their children about money.

Robin is a Chartered Professional Accountant (CPA, CA), keynote speaker, and bestselling author recognized for her expertise in personal finance and financial literacy. Her award-winning book, The Wisest Investment, has received accolades, including praise from David Chilton, the star of Dragons’ Den and author of The Wealthy Barber.

With a unique ability to simplify complex money topics, Robin acts as the “Google Translate” for personal finance, making it accessible to all. Her background includes roles in audit, taxation, and derivatives marketing at leading Canadian firms. She is also a passionate advocate for advancing women CPAs into leadership roles.

Robin holds a Bachelor of Commerce degree with High Distinction from the Rotman School of Management at the University of Toronto and is a lifelong learner, having completed the Canadian Institute of Chartered Accountants’ In-Depth Tax Course.

Residing in Toronto, Robin and her husband have raised two (mostly) money-smart young adults. Besides her financial expertise, she enjoys snowboarding, cycling, and attending concerts, including a memorable backstage encounter with Bruce Springsteen.

For more about Robin and to purchase a copy of The Wisest Investment, click here.

You can listen to this episode here or find us in your favourite podcasting app, including Apple Podcasts, Spotify, Google Podcasts and Amazon Music.

If you like what you hear, please don’t hesitate to rate us kindly. And if there are particular topics you’d like covered, please let us know.

Tax-Effective Giving with Ali Spinner on The Unlimited Podcast

Ali Spinner on The Unlimited Podcast

Even though tax season is coming to a close, it is never to late to plan for next year! On this episode of The Unlimited Podcast, Alexandra (Ali) Spinner joins Brian to share some tips and tricks for maximizing your charitable donations.

Brian and Ali discuss Ali’s “Three W” framework for giving, alternative donation methods, different avenues for philanthropy, how Ali became known as the Tax Ninja, and much more!

Ali is a Partner in Crowe Soberman’s Tax Group, a member of the firm’s Management Committee, and leader of the High-Net-Worth tax practice. Her practice focuses on helping wealthy families and high-performance professionals structure their affairs in a tax-efficient manner. She works closely with her clients to ensure that their short and long term personal, financial, estate, and philanthropic goals are carefully considered in their planning. Ali brings a high level of passion and warmth to her practice and enjoys building deep relationships with her clients across generations.

Ali’s broad technical expertise includes domestic, cross-border, and international tax matters for individuals, trusts, estates, and corporations. She is experienced in complex estate and trust planning, post-mortem planning, corporate reorganizations, and the preparation of Canadian tax returns and compliance forms. Her transaction advisory experience includes tax due diligence and business purchase and sale structuring. She has testified in Ontario court and has been recognized by the court as an expert in taxation matters.

Ali has more than 20 years of experience in public accounting and tax and estate planning. In 2022, she was elected as a Fellow of the Chartered Professional Accountants of Ontario. The distinction of Fellow formally recognizes her exceptional service to the professional and to the broader community.

Ali is a past lecturer in the Commerce Program at the University of Toronto’s Rotman School of Management, CPA Canada’s In-Depth Tax Program, and the School of Accountancy Tax Program administered by CPA Ontario.

In 2020, Ali was the recipient of the Award of Excellence presented by the Jewish Foundation’s Professional Advisory Committee. In 2016, she was a winner of the M&A Advisor Emerging Leaders Award (Top 40 Under 40). In 2015, she received the CPA Ontario and the Institute for Management & Innovation at the University of Toronto’s Alumni Award. She is also a 2002 recipient of the Gordon Cressy Student Leadership Award from the University of Toronto.

This episode can be found here or find us in your favourite podcasting app, including Apple Podcasts, Spotify, Google Podcasts and Amazon Music.

If you like what you hear, please don’t hesitate to rate us kindly. And if there are particular topics you’d like covered, please let us know.

Ginsler Wealth Third Quarter 2022 Client Letter – Opportunity Knocks

(An audio version of this letter can now be found as Episode 11 of The Unlimited Podcast by Ginsler Wealth. Use the link provided or find us on your favourite podcast app.)

 

To Ginsler Wealth’s Clients:

The economic and investment climate remained very challenging in Q3, following a very difficult first half of the year. As at September 30, 2022, the U.S. equity markets (as measured by the S&P 500) are just 6% above where they were in February 2020, just prior to the pandemic, after having risen 41% above the February 2020 peak and 107% from the March 2020 lows.

S&P500 Performance Since 2020

The Canadian equity markets (as measured by the S&P/TSX index) are just 3% above February 2020 levels after having risen 23% above the February 2020 peak and 97% from the March 2020 lows.

S&P TSX Performance Since 2020

Canadian bonds (as measured by the S&P Canada Aggregate Bond Index) are down almost 11% this year. Central banks continue to raise interest rates to fight high inflation and Russia continues its war with Ukraine. It is reasonably likely that all the equity market gains made from the time Covid-19 began will be erased. Two and a half years…gone. So, what does this mean?


OPPORTUNITY KNOCKS

While it is easy to focus on the negative, we are focusing on opportunities this environment presents. For GW, this means taking the following actions:

  1. Looking at historic trends, especially equity market returns
  2. Adjusting your portfolio and/or finding new strategies
  3. Putting cash to work (even if just to earn more than bank account interest)
  4. Taking time to plan
  5. Focusing on your health


Looking at Historical Trends

While all client portfolios are tailored to your specific needs, goals, and objectives, in general, your investment portfolios with Ginsler Wealth include more than just traditional stocks and bonds. This diversification has helped insulate your assets from some of the challenges of this year.

However, we still believe that over time, equities should be the highest return contributor to your overall portfolios. What does history say about equity returns following large declines? The table and chart below show that following declines of 25% or more, the S&P 500 (the barometer of the overall U.S. equity market) has historically gone on to post substantial gains.

Chart of S&P Performance Post-25% Declines

Average S&P500 Performance Post -25% Losses

As Ben Carlson says in the article where the above data was reported: “History provides no guarantees for the future, but I do find some level of comfort in knowing that buying stocks when they’re down big like this tends to offer positive outcomes.”


Adjusting the Portfolio and Finding New Strategies

While the data above should provide a level of optimism for equity returns going forward, I do note that the 2022 decline shown in the table above is also the smallest major decline. There certainly could be more pain in the short term. But the current environment has also created opportunities in other areas. These are just a few of the strategies we are either adding to or exploring on your behalf:

  • Actively managed bond portfolios – as interest rates have risen, so too have yields on these portfolios – and we are confident that the managers we utilize are well aware of, and planning for, potential future interest rate increases,
  • Agriculture, infrastructure, and other assets that could perform well in inflationary and/or recessionary environments,
  • Structured Notes that provide dramatic downside protection along with the potential for high interest payments or magnified returns,
  • Cash management opportunities – ways to earn a better return on cash that is sitting in your bank account (see next section).

In finding new strategies, we have spent a significant amount of time reviewing investment opportunities from existing and new managers, exchange-traded-fund providers, and even the banks (see Structured Notes above). We do not make investment decisions lightly. Our due diligence process is detailed, rigorous, and thorough.

For instance, we recently reviewed all the legal documentation (a few hundred pages!) for a U.S.-based fund that could be a good fit for certain client portfolios. In our review, we believed we had found one very important missing word, the missing needle in the haystack. After inquiring, we received the following (redacted) email back from the manager:

“Ginsler Wealth Team – It turns out you were quite correct, and our hilariously expensive NYC attorneys missed a very important word in the XXX clause.” 

You rely on us to be thorough and thoughtful before investing your money. We take this responsibility very seriously.


Putting Cash to Work

We know some investors are concerned about the current economic environment and have been sitting on cash in their bank accounts. This cash earns next to nothing and, net of inflation, its value is being eroded.

Due to demand from existing and new clients, we have compiled a selection of lower-risk, shorter-term “Cash+” strategies that we believe could provide a higher and potentially more tax-efficient return on dormant cash. The chart below provides a comparison of bank high interest savings account rates versus the target return on the Ginsler Wealth cash management mandate.

Bank Savings Rates vs. GW Cash Strategy

We believe a reasonable portion of the target return above should come in the form of capital gains which are taxed at half the rate of interest income. As a result, the net differential return after taxes, relative to the bank savings accounts, should be even higher than illustrated in the chart above.

While high and rising interest rates are bad for borrowers, they are beneficial to savers.


Taking Time to Plan

When investment gains are challenged, it is a reminder that keeping every dollar is even more important. On the planning side, we have been working with several clients to introduce more tax effective trust and corporate structures. This planning can serve to potentially minimize taxes over time and/or at the time of a business sale, while also protecting the owners of the assets from lawsuits and/or creditors. Doing this structuring work today, could lead to perpetual, risk-free returns in the form of ongoing tax savings.

We are also (continuously) seeking opportunities to harvest investment losses to be used in the future to offset capital gains. While no one enjoys crystallizing losses, when other opportunities present themselves (see above), switching out of current losers can lead to tax savings on future winners.

 

Focusing on Your Health

Finally, while finances and investments are what we do and are important, we aim to be helpful in many aspects of your lives. It is often said that “health is wealth” and we totally agree with this sentiment. As such, through a new relationship with Medcan, Ginsler Wealth clients can now enjoy a 15% discount on Medcan’s flagship Comprehensive Health Assessment, along with three other advanced health tests. Please contact us if you want to take advantage of this. We are also exploring partnerships with other health organizations with the goal of bringing more value to you in the future.

During the past quarter, we also recorded an Unlimited Podcast episode about the state of mental healthcare in Canada with Dr. Juveria Zaheer and Sandi Treliving, both involved with Toronto’s Centre for Addiction and Mental Health (CAMH). Mental health is an equally important component of your overall health, and we hope this podcast episode can help provide some insights into what you can do to help others or manage your own mental health.

 

CLOSING THOUGHTS

As we head into the final stretch of 2022, I don’t believe uncertainty or volatility will dissipate. Our role – on your behalf – is to seek out opportunities this challenging environment presents. I hope you can tell…we are on it.

Thank you for your trust, support, and confidence. We are available 24/7 should you need us.

Sincerely,

Brian singnature

Brian Ginsler
President & CEO

Brian Ginsler Announces Launch of New Independent Wealth Management Firm, Ginsler Wealth

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Brian Ginsler, a Canadian wealth management industry leader, is pleased to announce the official launch of a new, independent wealth management firm, Ginsler Wealth Management Inc. (“Ginsler Wealth”).

Ginsler Wealth was created as a direct response to growing demand from high net worth families for a comprehensive solution for their overall wealth management needs. Ginsler Wealth provides financial planning services, which include tax, estate and insurance planning, along with an open-architecture investment management platform that brings a universe of investment opportunities to clients, without the sale of proprietary products.

“Ginsler Wealth is a new wealth management experience,” said Brian Ginsler, President & CEO. “We exist to serve successful families that embrace independence and the flexibility it provides; families that want unconstrained wealth management solutions; and families that expect a higher, more personal level of service. Think of it as your wealth…unlimited.”

Ginsler Wealth’s founder, Brian Ginsler, is a wealth management industry veteran. After completing his MBA at Harvard Business School, Ginsler achieved his Chartered Financial Analyst and Certified Financial Planner designations and has held leadership roles in investment banking, wealth management & family office, investment management and alternative lending. Ginsler is a registered portfolio manager. He was the first advisor in Canada to achieve the Certificate in Blockchain & Digital Assets from the Digital Assets Council of Financial Professionals in New York (“DACFP”).

Ginsler Wealth’s services fall into four categories:

  1. Planning – Cashflow & budgeting; tax, insurance, estate and retirement planning.
  2. Investing – Goal setting, asset mix determination, investment manager & strategy selection, reporting.
  3. Coordinating – External advisor & investment manager oversight, review of private investments, consolidated reporting.
  4. Living – Lifestyle concierge, information services, strategic business advice, philanthropic planning.

Ginsler Wealth believes high net worth families can no longer be constrained by traditional investment portfolios simply comprised of stocks and bonds. Ginsler Wealth client portfolios include real estate investments, alternative investments, investments in private deals and private companies, and exposure to digital assets such as Bitcoin and Ethereum.

As the first advisor in Canada with a certificate in Blockchain & Digital Assets (i.e., “cryptocurrency”) from DACFP, Ginsler Wealth is uniquely positioned to advise Canadians on adding digital asset exposure to their overall portfolios.

In addition, Ginsler Wealth has introduced a unique fee structure: “We strive for direct alignment with our clients in everything we do,” said Brian Ginsler. “We believe our standard management fee is lower than our competitors; if we don’t do a good job for our clients, we get paid less than our competition. Our performance oriented fee structure allows us to do well only if our clients do well.“

Ginsler Wealth is a new alternative for those seeking an independent, unconstrainted wealth management alternative. “Our independence ensures we solely serve our clients and enables us to be unconstrained in our ability to search the world for the most appropriate solutions,” said Ginsler.

 

About Ginsler Wealth Management Inc.

Ginsler Wealth Management Inc. (“Ginsler Wealth”) is a new wealth management experience. We exist to serve successful families that embrace independence and the flexibility it provides; families that want unconstrained wealth management solutions; and families that expect a higher, more personal level of service. Think of it as your wealth…unlimited.

Ginsler Wealth is a registered portfolio manager and exempt market dealer in the province of Ontario.

Hats Off to the New and Improved RESP

Brian Ginsler featured in The Globe and Mail article by Rob Carrick

 

 

This week’s federal budget took the already essential registered education savings plan and made it just a bit better.

There’s more flexibility for people in how much they invest in RESPs each year, and the government is increasing the annual amount of grant money it will put into a plan to match funds contributed by parents and others. But with these improvements come added complications that warrant a fresh look at RESPs.

That’s what this edition of the Portfolio Strategy column is all about. Consider it your RESP investing toolkit, with suggestions on how to manage RESPs and strategies for making contributions that reflect the changes introduced in this week’s federal budget.

There are three main changes in RESPs that take effect for the 2007 tax year when the budget passes in the House of Commons:

the $4,000 annual contribution limit disappears.

the lifetime contribution limit rises to $50,000 from $42,000.

the maximum amount of money that Ottawa will pay into an RESP annually through the Canada Education Savings Grant rises to $500 from $400.

Each of these changes should cause you to reconsider your RESP investing approach. For example, a lot of people put $2,000 per child in RESPs each year because the 20-per-cent matching CESG grant paid out no more than $400 per child (20 per cent of $2,000 is $400). Now, you’ll want to ratchet up your annual contribution to $2,500 at minimum to capture the maximum $500 per year in grant money.

Note that the total amount of CESG available to RESP beneficiaries remains unchanged at $7,200. What the government has actually done, then, is accelerate payment of CESG so you can get it into your plan sooner and start earning investment returns.

The new RESP rules also mean you can put as much as $50,000 in a plan right away, a move that would cost you $6,700 in grant money. The background here is that the government will pay a maximum of $500 in CESG annually ($1,000 if you have unused CESG from a previous year), and it won’t credit you with additional CESG payments in future years for a large, lump-sum contribution made in the past. The bottom line: A large lump-sum contribution will cost you grant money.

The CESG is government largesse at its finest, but if you have $50,000 to invest in an RESP then consider turning your back on it and making a single lump-sum contribution. Financial adviser Brian Ginsler of Northwood Stephens Private Counsel produced a spreadsheet for this column showing that $50,000 invested in an RESP would produce $216,739 over the 25-year maximum lifespan for a plan, assuming $500 in CESG was collected for the year the contribution was made and investment returns averaged 6 per cent a year.

Mr. Ginsler found that you’d end up with $155,713 if you annually put $2,500 in an RESP to get the maximum $7,200 in grant money and then, once the grant money stopped flowing, immediately topped up the plan with $15,000 to reach the $50,000 lifetime contribution ceiling.

Another approach would be to make identical $3,333.33 RESP contributions for 15 years, giving you the $50,000 lifetime maximum and the full $7,200 in CESG. Mr. Ginsler said this would give you $168,805.

Still another slant would be a 15-year strategy presented by Keith Armstrong, an individual investor who was responding to a column earlier this week on RESPs. You put $15,000 in an RESP in the first year, and then make annual contributions of $2,500 for the next 14 years. Mr. Ginsler’s spreadsheet shows you’d have an RESP value after 25 years of $185,633 if you did this.

Mr. Ginsler made the point that someone with $50,000 who wanted to collect federal grant money could theoretically invest the money in a non-registered investment account and then gradually move it into an RESP.

But his calculations show that even when you add the proceeds of the non-registered account and the RESP together, this approach yields less than the $50,000 upfront investment.

There’s a simple conclusion to be drawn from this tangle of numbers about the new RESP rules, Mr. Ginsler said. “If you have $50,000, you’re better off plunking it in an RESP right now and having the benefit of continuous tax-free compounding working for you.”

For those who don’t have $50,000 per child to invest in RESPs, there’s the gradual approach to building up a plan.

Graeme McPhaden, a certified financial planner (CFP) with Armstrong & Quaile Associates Inc., has some simple advice in this regard: “Definitely be aggressive with your investing, and do it monthly.”

All of Mr. McPhaden’s clients make automatic monthly RESP contributions rather than scrambling at the end of the year to find some money. This ensures a steady, uninterrupted flow of money into an RESP, and eliminates any year-end scrambling to find the necessary cash. It also helps shield clients from the grief caused by investing a big chunk of money into a market primed for a fall.

That said, there are studies suggesting you’ll get superior returns with a big one-time investment as opposed to dollar-cost averaging, which is the term for spacing out your investments over time. Here’s yet another vote for lump-sum RESP investing.

As for being aggressive, Mr. McPhaden and others use an investing approach that focuses on equity funds for the first and middle years of an RESP, and then shifts into more conservative balanced funds (a mix of stocks and bonds) five years before the plan beneficiary is to start college or university. The idea is to build capital, and then preserve it while also achieving a little growth.

Mr. McPhaden’s fund of choice for starting an RESP is Ethical Special Equity, which focuses on smaller, riskier stocks. This is a socially responsible fund, which means it avoids certain sectors and looks for standout corporate citizens, and its performance over the long term is very good. The 10-year compound average annual return is 13.8 per cent, compared with 10 per cent for the average peer fund.

Kevin O’Brien, an adviser in Ancaster, Ont., said he uses two widely held stalwart global equity funds to start an RESP, Trimark Select Growth and Templeton Growth. Then, with five years to go until RESP withdrawals commence, he directs new RESP contributions to balanced funds like Trimark Income Growth. When it’s time to start making RESP withdrawals, Mr. O’Brien starts with the global funds.

The rule changes in this week’s budget will prompt lots of rethinking about RESP investing, but Mr. O’Brien has his own idea for helping families build up the savings they need to afford the cost of postsecondary education. “I’m hoping to get more grandparents involved,” he said. “If they want to leave a legacy, what better way?”

Go for the Grant?

The All-At-Once Approach

How it works: You contribute $50,000 when you open the RESP

Total amount of CESG: $500 (paid on the $50,000)

End value: $216,739

The Step-Up Approach

How it works: You make $2,500 annual contributions for 14 years to qualify for the maximum annual $500 in CESG, then a lump-sum $15,000 to bring you to the $50,000 limit.

Total amount of CESG: $7,200

End value: $155,713

The Step-Down Approach

How it works: You put $15,000 in a plan, then contribute $2,500 annually for 14 years.

Total amount of CESG: $7,200

End value: $185,633

The Steady Approach

How it works: You make 15 annual contributions of $3,333.33.

Total amount of CESG: $7,200

End value: $168,805

The ABCs of RESPs

The basic concept: Save for your child’s university or college education in a tax-sheltered plan, and have the federal government match every dollar you contribute up to $2,500 per year with a 20-per-cent grant. Withdrawals from RESPs are taxed in the hands of the beneficiary student, who would typically pay little or nothing in income tax. You do not get a tax deduction for making an RESP contribution, as you do with registered retirement savings plans.

History: RESPs have been around for decades, but they only took off after the introduction of the Canada Education Savings Grant in the 1998 federal budget.

Different kinds: There are three types of RESPs — individual, family and group. Individual plans are for a single beneficiary and can be set up by anyone (you can even set one up for yourself to return to school at a future date). Family plans, which can only be those related to a beneficiary by blood or adoption, are ideal for a group of siblings. If one doesn’t pursue a postsecondary education or takes a particularly long or expensive course of study, there’s flexibility in the family plan to allocate resources where they’re needed. Group plans, also called scholarship trusts, pool client money and invest it in a portfolio of bonds, GICs and such.

Where to set one up: Banks, financial advisers, investment dealers and discount brokers all offer RESPs, as do a variety of scholarship trust companies.

Pitfalls: The obvious one is where you have an RESP set up for someone who does not pursue a postsecondary education. In some cases, you can select another beneficiary to receive some or all the benefits. Alternatively, you can withdraw RESP assets, subject to taxes and repayment of CESG. You can also transfer up to $50,000 in RESP earned income to your registered retirement savings or a spouse’s, providing there’s contribution room.

Some other things you should know: A child needs a social insurance number to have an RESP set up on his or her behalf; the maximum life of an RESP is 25 years; CESG is only available to those 17 and younger, and the lifetime maximum amount is $7,200; the annual CESG maximum is $500, but you can receive an additional $500 to make up for grant money you didn’t claim in a previous year.

ROB CARRICK