Your Legacy: What's Your Financial Game Plan?

If you are a sports fan, I hope you are able to find some time over the next few months to kick back and watch?the NHL and NBA play-off action unfold. No matter the team sport, commentators and analysts tend to?focus much of their discussion and debate around the?offensive?and?defensive?abilities?of the players and teams.

Coaches will often say that the best offense is a good defense. Isn't that the truth!?It's also true when you?consider your own financial?game plan.?As a business owner or professional, you want to focus on?getting your puck in the net?and growing?your business. It's also important to plan for?and minimize any bumps along the way with a good defense.

How is your offense and defense measuring up??

Does your defense support your offense?

In sports, offense is the action of attacking or engaging an opposing team with the objective of scoring points or goals.

Defense is the action of those players responsible for preventing the other team from scoring.

When both of these strategies?are in place, the results can be far greater than one without the other. Both are required for an?effective game plan.?Your?financial game plan?is no different.

If you are an established business owner or professional, your offensive play is to?score?goals.?You can do this by:

• Increasing your sales.
• Growing your business.
• Developing a diversified portfolio and building your wealth.

You likely have a strong offensive position. You should have a good understanding of your financial trajectory and understand what you will have in your retirement.?

Your offensive plan is critical. It includes everything you have been working so hard for.

The harsh reality is that if you don't combine it with a defensive strategy, you have put your assets?at risk.

Especially, if you have built up a significant amount of assets?over the course of your career and haven't thought enough about how you are going to protect those assets from tax erosion and other risks.?

Your defensive?play is to?protect your net.?You can do this by:?

• Minimizing liquidity risk so you can deal with unforeseen events.
• Protecting yourself with appropriate forms of insurance while maximizing tax-effective strategies.
• Implementing a risk management plan.

With a proper defense, you can protect yourself and your wealth so you don't put yourself in the vulnerable position of needing to:

• Find extra cash that would be better utilized in your business or portfolio.?
• Borrow?funds and pay?high interest rates.
• Sell assets you've worked hard to attain.

Protect Yourself with:

Liquidity?

It's important to?have the ability to meet short-term financial obligations without incurring significant?losses.?

An example of liquidity risk is having your money tied up in the business and not being able to pay staff or your monthly bills. It's critical to hold sufficient cash to meet demands to properly manage your liquidity risk.

Insurance

There are a variety of insurance solutions that should be considered as part of your over-arching risk management plan.?

Your most?important asset is your ability to earn income so protecting that asset is?a priority.?Think about how your inability to work would impact you, your business, your family and your financial game plan.

No one wishes for?a catastrophe to happen but if it does, it sure does alleviate stress when properly insured.

Disability Insurance?provides monthly payments?to help your?business?run smoothly in the event that you are prevented from working due to illness or injury.?

Critical Illness?Insurance?provides additional coverage, in a lump sum payment, for medical emergencies like heart attacks, strokes, or cancer.?

The costs associated with these health emergencies are significantly higher?than what would be covered in a standard health insurance plan.?

Life Insurance?is quite a unique product and?most people know what it?is?but don't know what it can do.?It's?the most cost-effective way to preserve your wealth while saving significantly on taxes.

A permanent life insurance policy allows you to:

1. Build your net worth on?a tax-preferred basis.?
2. Have tax-free access to cash value for emergencies or other needs including retirement.
3. Maximize your estate, helping you protect and leave a legacy for your family.

For pennies on the dollar, you can create a tax-free payout of the insured amount.?

An alternative approach to paying life insurance premiums is to consider an?Immediate Finance?Arrangement.

An Immediate Finance Arrangement allows?you to leverage your life insurance so you can benefit?from having the insurance and not have it impact your liquidity?in the short-term, while?paying very little interest.

Risk Management Plan

To determine the most appropriate defense strategy for you and your business, it's important to review both your offense and defense strategies?with a financial professional who can make sure that?a harmonious risk management plan is put into place.?

You can protect your assets with a plan that makes sense for you and your business.

- Happy Planning

??? New Podcast: Mayor of Money

The Mayor of Money podcast features wonderful guests and topical discussions around wealth, risk management, planning, entrepreneurship, real estate and development.

Living Benefits Protection?Rick?speaks with Vanessa Scott, National Living Benefits Sales Consultant with Manulife about protection for business owners.?

Up Close and Personal?Rick speaks with?Jeff Paikin, President of New Horizon Development Group about?his entrepreneurial journey and first real estate development.

Special Edition: Federal Budget 2022?Rick?speaks with?Jo?l Campagna, a Tax Partner with MNP about?The Government of Canada’s plan.

For tomorrow belongs to the people who

prepare for it today.

- African Proverb