What to Teach Your 18-Year old About Opening a TFSA

What to Teach Your 18-Year old About Opening a TFSA

It’s not easy getting your teen interested in the idea of investing in their future. Most teens have a shorter attention span and are rarely focused on long-term goals — they’re thinking about the present. This can make it somewhat difficult to explain the benefits of saving, especially if most of the financial terms go straight over their head.

If your teen has turned 18, it’s time to start teaching them about TFSAs. 18 is the age when Canadians can begin opening and using TFSAs, and with compounding interest, it’s wise for them to start early and do just that.

With the right words and some guidance, you can help them grow a future nest egg as they ease into adulthood. But where to begin? Here are five things you can teach your 18-year old today about opening a TFSA.

The Art of Compounding

If you start early, the power of compounding can add up to millions of dollars over the long-term. If that won’t get your teen’s attention, nothing will. Once they are interested in what you have to say, that’s when you shock them with the long-term benefits of a TFSA. The best way to make them understand is to show them a real-life example of how much money they can expect to earn in 20, 30, 40, and even 50 years when they start making small contributions each month, starting now. When they see the power of compounding in action, it’s sure to get them excited about forming a long-term strategy that invests heavily in their future.

The Benefit of Tax Savings

It’s unlikely that your teen knows much about taxes or how they will impact their savings over time (and if they do, great for them!). That’s why now is the best time to teach them about tax-sheltered instruments, like a TFSA. They may not fully understand all the tax jargon in relation to capital gains, interest earned, or Canadian dividends. Hone in on the fact that with a TFSA, they can withdraw their money tax-free — unlike the majority of banking accounts. They’ll appreciate the idea of avoiding fees and having more money in their pockets.

How to Maximize Contributions Without Penalties

Accidentally contributing more than $5500 a year may result in penalties. It’s essential to teach your 18-year old about the maximum contributions and how they can add to their account without acquiring fees. For instance, if they were to contribute the full $5500 in one year, they could have to wait a full calendar year before putting more money into the account. Your teen can contribute to their TFSA for every year that they have been at least 18 since 2009, as illustrated here. An example of this would be if you have a son who turned 18 in 2016 and is just opening a TFSA now, he would actually be eligible to contribute $16,500 right away.

How to Be Smart With Their Money

Unlike an RRSP, money can be withdrawn from TFSA at any time without paying taxes. This could be a concern if you invest in your teen’s savings account and they withdraw the money straight away. That’s why it’s important to teach them how to be smart with their money, why a long-term goal is better than short-term gains, and that a TFSA is an investment tool more than a savings account.  You may even consider teaching them how to use their TFSA to purchase mutual funds, GICs, and other investment accounts to help grow their money, not just save it. The more they know now, the better choices they will make in the future.

If you’re not sure how to discuss TFSAs with your teen, we can help. At The Beacon Group of Assante Financial Management Ltd., we manage not only our client’s wealth plans but also their children’s investments too. We can teach them the benefits of long-term objectives and what the right choices are for investments with a particular goal in mind. To learn more about our family wealth planning, contact us today.

How to Make the Most of the Holiday Season in Calgary

How to Make the Most of the Holiday Season in Calgary

‘Tis the season to indulge in too much sugar, spend time with family, and help those in need. With Christmas just around the corner, there’s so much happening in and around the city to help you embrace the magic of the season. This year, get out and make the most of the holiday season in Calgary with these suggestions.

Shop Early

We all know that the holidays bring a flurry of activity in malls, stores, and markets across the city. Leaving the shopping list to the last minute is always a regretful situation when you have to endure the crowds and long line-ups. To avoid the chaos, get out as early as possible to get a jumpstart on your shopping. Not only will there be more selection, but there will also be more parking and fewer crowds to navigate!

Make Time for Family

Life gets busy, which means we don’t always have as much time as we’d like to spend with our loved ones. That’s why the holidays are an ideal opportunity to rest, recharge, and spend some quality time with family and friends. Meet up for brunch dates, host an app and cocktail party, or cook Christmas dinner to carve out time and catch up with everyone.

Support Local Markets

The holidays are all about embracing the magical, light-strewn settings, the nostalgia from our childhood, and the quaint, cozy markets that pop up across Calgary during this time of year. With so many Christmas markets to explore, you and the family can sip on hot cocoa, find one-of-a-kind, hand-made goods, and support local artisans while creating new memories together.

Give Back

Though giving back is essential any time of the year, the holidays are always a healthy reminder of how lucky we are, and how other families and people within our city aren’t so fortunate. Giving back to support your community, whether it’s through charitable donations, volunteering, or inviting your neighbour over to join you for Christmas dinner, are simple ways to help those who are less fortunate.

With our busy schedules and fast-paced lives, it’s essential to learn how to slow down once in a while and appreciate the special moments with family and friends. Merry Christmas and happy holidays from us at The Beacon Group of Assante Financial Management Ltd.!

5 Ways Workaholics Can Feel Fulfilled in Retirement

5 Ways Workaholics Can Feel Fulfilled in Retirement

Feeling useful and having a purpose in our lives is vital for our happiness. Since building a career takes a great deal of time and effort during the course of our life, our work becomes a defining part of our identity. Many of us genuinely love our jobs, and it’s hard to give them up when the time comes.

It’s natural that when retirement rolls around, many of us feel as if we are losing that sense of identity and meaning.  This can feel confusing, overwhelming, and even scary; there are some simple ways that workaholics like you can learn how to settle and feel fulfilled. If you’re approaching retirement with apprehension, learn how to shed your fear and embrace your newfound freedom with these suggestions.

Join Something

Today, more than ever before, there are plenty of ways to get out there and get involved — whether it’s with your local community, a walking group, volunteering, or even with your church. Spend some time thinking of what you enjoy and ask around or do some research online to find a local committee or group you can join. This is an excellent way to give more purpose to your everyday life while also meeting new people and expanding your knowledge, skills, and experiences!

Pursue a Hobby

Retirement is all about embracing your freedom and spending time rediscovering what you enjoy. There’s no better time than now to pursue a new hobby or pick up with one that you left on the back-burner while you were focusing on your career over the years. Learn a new instrument, take art classes, try baking again, or find anything that will get you excited to learn and grow in your retirement.

Travel More

With time on your side, why not spend it seeing and exploring more of the world? Hop on a cruise liner or join a tour where you’ll have all the logistics taken care of for you — that way, you’ll be free to enjoy a completely stress-free experience. Think of all the places you were dreaming of seeing when you were younger and take advantage of retirement now by adding some adventure back into the mix.

Spend Time With Friends

Studies have shown that as we grow older, spending time with those we care about is not only beneficial for our well-being — it’s essential. Make a plan to meet up each week with friends or plan weekly dinners with family. Don’t be afraid to reach out to others and create plans from thin air! Being proactive is the key to a fulfilling social life.

Have a Plan Before You Exit

When your paycheque switches to your pension cheque (if you’re lucky), you need a plan to ensure that you’ll have enough money for your retirement. Being retired means you have the freedom and time on your hands to do what you’d like, but depending on what you’d like to do, it can get expensive.

Even if you have enough saved, you still need to understand how to access and manage your assets to keep your taxes at the lowest rate possible. Don’t wait to start planning until you wish you started earlier! Contact us at The Beacon Group of Assante Financial Management Ltd., and we’ll set you up with a Lifetime Approach system to help you achieve your retirement goals.

If you see yourself as a workaholic and worry whether you will feel fulfilled in retirement, remember that it all depends on being proactive! Feeling nervous about this transition is entirely normal. And, it will take some time to adjust to this new phase of life. By getting involved, finding new hobbies, and surrounding yourself with the people you care about, we promise it’ll be more enjoyable than you could have ever imagined.

5 Steps Small Businesses Can Take to Improve Their Work Culture

5 Steps Small Businesses Can Take to Improve Their Work Culture

Having a robust and healthy work culture is imperative when running a small business, no matter what industry you’re in. Regular interactions in your workplace (whether between your employees and management, between just your employees or within the management team) all significantly influence your business operations for better or for worse. The atmosphere inside a business is a direct indicator of productivity levels. Happy staff: better results.

While it’s not always clear-cut on how to achieve a better dynamic in the office, there are some key methods you can use which tend to work well to achieve a healthy company culture. Below are some simple, actionable steps that small businesses can take to improve their work culture and propel their business forward.

Be Transparent

Having an easy way for employees to collaborate, communicate, and share information efficiently is crucial for any business. It’s important to keep up-to-date with modern communication tools and project management apps to maintain transparency and organization. This is something that can help foster better workflow and teamwork which benefits the entire business.

Offer Rewards for Stand-Out Work

When your employees are working hard to produce the best results for your business, a little appreciation and recognition can go a long way. In fact, many studies have shown a dramatically lower employee turn-over rate amongst recognition-rich companies. Whether it’s a gift, a bonus, drinks at the local watering hole to celebrate a deal, or even a simple ‘thank you,’ rewards and gestures that show appreciation are meaningful yet straightforward steps that small businesses can take to improve their work culture.

Foster Stronger Coworker Relationships

Much like in sports teams, the relationships between your team members can make or break your success. That’s because when members get along, they communicate more effectively, which is the most important part of running a smooth operation. Think about whether the workplace is conducive to fostering better employee relations and how it can be improved. Hosting activities that allow your employees to mingle and get to know each other more, is always an impactful way to develop your company culture.

Be Considerate of Burnout

We live in a time where we’re always connected — that means that in addition to heavy workloads, there’s not much room for personal time to disconnect and recharge. It’s no surprise that burnout has become such a common occurrence in the workplace today. As the boss, it’s important to recognize when your employees have hit that stage because no matter how hard they try, burn out will significantly affect how they perform. Be mindful of this; help your employees avoid reaching this point by recognizing the need for adequate time off to relax and recuperate.

Be Flexible

Times are changing, and that includes the structure of the workplace. Offering flexibility to employees has proven to be very effective for improving morale, increasing employee retention, and ultimately, keeping them motivated to do a great job. Being flexible can differ for everyone — it could mean offering work-from-home days, shorter work days each Friday, more breaks, or letting parents slip out early to pick up their kids when they need to.

Improving work culture isn’t something that just happens. It takes time, effort, and a good level of understanding from you as a leader. Think about how you can propel your small business forward by incorporating these simple methods for fostering stronger relations and better communication among your team.