Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Table of Contents
Introduction.....................................................................................................2
Objectives and Data........................................................................................5
Financial Planning............................................................................................8
Analysis..........................................................................................................10
Development.................................................................................................11
Retirement Planning......................................................................................14
Risk Management..........................................................................................21
Investment Planning......................................................................................27
Tax Planning...................................................................................................32
Estate Planning..............................................................................................34
Education Planning........................................................................................41
Insurance Planning........................................................................................47
In conclusion..................................................................................................53
1 | Page
Introduction:
Dear Mr. & Mrs. Arbid,
Thank you Arbids for choosing Artil Financial Services Inc. As per the
engagement letter we signed on May 19th, 2016, I will work with you to
develop and maintain the confidence you have in me and my firm.
My name is Mahmoud Artil, I am a Certified Financial Planner (CFP), and a
Certified Financial Advisor (CSI). I hold a Bachelor Degree in Finance from the
University of Abu Dhabi, United Arab Emirates. I have been practicing
financial services and focusing on financial planning since 2006. My clients
vary from business owners, employees, professionals, families and retirees.
The aim of getting my services is not only to manage your short-term
expenses; but also to make the most use out of your financial resources by
finding a way to reach your goals and future objectives. Everything with
planning preforms better.
There will be an ongoing periodic meetings to construct and implement the
best plan for your objectives and goals. Through different stages, we will
share the responsibility to get the maximum benefit out of our meetings
which will be scheduled as follow:
COLLECTING
INFORMATION
In
order
to
provide
the
most
3 | Page
During any phase, I will be available 24/7 to assist and evaluate any specific
decision you might frequently consider or face. In emergencies, I will also be
welling to respond on any inquiry or dilemma needs clarification. I will always
refer you to one of our professional planner when I will be out of reach or in
vacations.
I look forward doing business with you and I hope our services will satisfy
your needs at your best comfort.
Sincerely,
Mahmoud Artil
Client Meeting 1:
In our first meeting; it was a pleasure getting to know you more and your
wife Donna. You showed your concerns about your family debt load and
whole financial situation. I understand that debt volume is increasing
nowadays in the Canadian society due to low interest rates offered and life
style demand; however, this phenomenon should be seriously treated and
managed. We had discussed the importance of the financial health and how
to manage your expenses. We had a brief understanding of each partys
responsibilities and tasks to overcome those obstacles. In order to best
4 | Page
1. To reduce the huge load of debt without effecting their current lifestyle.
2. Meet their expenditures and manage their spending.
3. Increase
their
insurance
unexpected uncertainties.
5 | Page
coverage
to
protect
the
family
from
1. Retire when John reaches 63 years old and Donna 61 years old.
2. Generate an income of $75,000.00 annually at retirement.
Objectives VS. Time Horizon: Before analyzing my customer capabilities and needs, I set a time frame to achieve
their goals and objectives. This strategy helps to distinguish and priorities their
objectives from date of engagement till death.
6 | Page
Implementation Years
Monitoring Years
Retirement/Generate Income 2
17
44
44
16.5
17
10
20
30
40
50
60
70
This Chart illustrates meeting objectives with a time frame of 17 years (63 years old at retirement) and
monitoring till death as expected (90 years old).
8 | Page
Financial Planning: :
$169,185.00
:
:
$67,800.00
$32,040.00
Total
$99,840.00
$62,350.00
Saving
$16,800.00
$178,990.00
Debt
** John MasterCard
Credit Limit
Amount outstanding
Interest rate
Minimum Payment
Total interest you will pay
Total to pay back
Months to pay off debt:
:
:
:
:
:
:
:
$45,000.00
$43,594.00
19.99%
$1,305.00
$20,627.13
$64,221.13
50
9 | Page
:
:
:
:
:
:
:
$10,000.00
$7,225.00
18.50%
$185.00
$3,918.43
$11,143.43
61
:
:
:
:
:
:
:
$400,000.00
$202,500.00
6.30%
$2,270.00
$71,372.46
$273,872.46
121
:
:
:
:
:
:
$14,250.00
7%
$85.00
$41,488.04
$55,738.04
656
:
:
:
:
:
:
$24,000.00
7.5%
$480.00
$4,866.47
$28,866.47
61
10 | P a g e
:
:
:
:
:
:
:
$24,000.00
$6,600.00
7%
$300.00
$484.41
$7,084.41
24
Analysis:
There are many general strategies to follow which manage your money and
limit your spending. Limiting your cash is one of the techniques widely used
to limit your spending. People usually leave only the necessary cash to cover
their planned expenditures. This doesnt mean to be too strict in yourself;
miscellaneous is real and it should be included in your budget plan. In
addition, using credit widely, its an easy access to your account; however,
you shouldnt miss use it to over buy now and pay late. Its widely
recommended to keep your credit card monthly payment limited to 20% of
your after tax income.
As per your case, I can see a very high equity ratio and we should control
and work out a plan to reduce your debt and pay it off quickly. We will
struggle at the beginning and we might use your savings to pay out high
interest debt. In the recommendation part, I will clearly show you numbers
reflecting how much you will save by paying out your debt from your savings
than the return you are getting right now. This doesnt mean we will not
invest your money or use all your reserves. Investing money is necessary in
every plan, however we should consider many things like taxes, dividends,
capital gain, and interest on the return on investment.
11 | P a g e
Development:
There are many suggestions you advised me earlier with regard to the
lifestyle downsizing you are planning to do. In our language, there are three
important categories to evaluate the perception of money.
The value of money to some individuals means security, those people who
save and plan for tomorrow. To others; it means freedom; they spend and live
day by day without thinking of tomorrow. The second is the risk tolerance,
some will hide their money at home or invested in risk-free investments,
while others will invest their savings in balanced risk investment or even
high ones. Finally, is the credit you are willing to take; some people will
expand their investment and business by borrowing money from the financial
institution and others will refuse.
12 | P a g e
After a quick analysis of your current expenditures please find the below
suggested budget to which I literarily eliminated some unnecessary
expenses which you can manage to live without till you clear some of your
debts.
13 | P a g e
14 | P a g e
There are some adjustments with the expenses I made according to your
recommendations, I hope it will satisfy your needs. First, I decreased the
vacation amount you are spending monthly from $500 to $400 a month,
restaurants to half from $750 to $375 and summer camps to be effective
only in summer. However, I also decrease the entertainment expenses to
$350 instead of $500. Finally, since John is working just around you will no
longer need a car and you can depend on your wife till we clear any of the
outstanding loans you have.
By this quick calculation, we made annually $10,184 of extra saving to be
invested for your retirement and future expenses. I hope you would be able
15 | P a g e
Retirement Planning:
Introduction
There are many retirement plans that you would find interesting to invest in
for your retirement. Weather if you want to retire early or you decide to work
longer, the sooner you set a plan, the more likely you will find yourself
prepared financially and mentally for your retirement. As age expectancy is
increasing due to better hygiene and medical care, Canadians are living
longer
16 | P a g e
retirement? Those sort of questions will help you set your objectives
according to the time set.
You need to know how much you should save After setting your goals
and understand your objectives; you would be able to figure out how much
money you are required to spare monthly to meet those objectives and live
comfortably at retirement.
Identify your investment opportunities Based on your risk tolerance
and money you can spare our constructed plan will advise you where and
how to invest through many investment choices to meet your goals easily
and efficiently.
Contribute to RRSP and make sure you use any contribution room
The government saving plans allows you to save without taxes and you may
carry forward your unused contributions yearly. This in one of the plans that
you can take an advantage of tax deferral till you withdraw the funds at
retirement. It is strongly recommended to contribute in the unused rooms
and not to skip any.
18 | P a g e
Purchase a life
annuity
Transfer to RRIP
19 | P a g e
20 | P a g e
21 | P a g e
RRSP:
John RRSP contribution to this DC plan
23 | P a g e
24 | P a g e
Risk Management:
Risk management and estate planning is a major part of our plan which
helps you to identify the unnecessary risk that you might be able to avoid.
The use of risk management mainly to reduce the severity and probability of
risk. The risk could be controlled by avoiding or reducing it, and it could be
financed by sharing or retention. There are several parts we should
understand like the health and long-term care, death insurance, life and
disability insurance, assets managements, estate planning, reduce the risk
impact, wills, taxes reduction and personal trusts.
Health and Long-term care:
In Canada, the health care and medical matters are covered by each
province to a restricted dollar amount or a number of doctor visit annually.
Those services cover some basic facilities and could be only grated to
residents only. There are many extended health insurances that would be
useful to cover the extra cost that may be in excess of the basic plan
coverage.
Some companies offer such coverage to their employees, however, you can
always purchase an individual plan at your own cost to cover yourself. Longterm care is designed to cover the health care need of the seniors from the
massive cost that could be raised. This coverage may be useful in case of illness or injury.
25 | P a g e
28 | P a g e
30%
11%
11%
28%
Pay-Later Loan
Line of Credit
RRSP Loan
House Mortgage
The only way out to solve this critical problem is by paying off your
mortgage through refinancing it through the next 10 years. Currently the
market closed mortgages according to my last records with an amortization
of 10 years charge an amount of 2.84% in interest. Thus we will be paying off
the mortgage loan through financing an amount of $102,519 over the 10
coming years at 2.84%. A quick calculation would lead us to a near figure of
$981.59 monthly for the coming 120 months.
Through this process, we will be saving around $1,944.40 monthly to be
invested in other resources to support our plan. This amount was calculated
by deducting the proposed loan monthly payment with the current monthly
payment of $2,926.
However, I would also strongly recommend you to consolidate your total
mortgage into one mortgage loan; not only to control the monthly payments
29 | P a g e
30 | P a g e
31 | P a g e
32 | P a g e
Investment Planning:
1. Improve your Investments
Whether you are choosing active administration utilizing money managers or
inactive administration utilizing Exchange Trade Funds (ETFs), consider both
increasing the profits for a given level of risk tolerance and minimizing your
investment risk for a given level of profit. This will guarantee that you keep
the increases made by your retirement funds however much as could
reasonably be expected. Your system will be vigorously affected by the
administration style and the advantage assignment inclinations you noted
before. In any case, enhancing your speculations is a consistent next stride
in the wake of finishing a Retirement Plan.
2.
35 | P a g e
Domestic Equities
Bonds; 80%
I made a quick analysis over the market and found out the bestselling bond
and growth stock to match your objectives would be:
36 | P a g e
Bonds
37 | P a g e
38 | P a g e
Tax Planning:
Every income earner pays the Canadian government and the province which
the taxpayer is living in on the annual income earned. However, as an
individual you must report your complete proceeds to the Canada Revenue
Agency (CRA). The taxes you should depends on your assessable income
either from your salary, dividends, interest, capital gain or business income.
The marginal rate of taxes raises as your assessable pay raises and
surpasses certain sums, called tax brackets. You can reduce your income and
the duties you pay by exploiting derivations and credits.
Tax deduction
Tax Deductions decreases your combined income to touch the base at your
net income for tax purposes. To illustrate some of the tax deduction that
would be useful in your situation youre your RRSP contributions, maybe your
future professional dues, unions and your childcare costs. Additional sources
would be like carrying over capital losses, diminish your net income to touch
base at taxable income the premise for figuring the taxes you owe.
Tax credit
Is much important as tax deductions, it is a particularly made to measure the
funds that is deducted from the measure of taxes you owe the government
yet not from the measure of proceeds you acquire. The measure of the tax
39 | P a g e
Non-refundable Tax Credit which is utilized against some taxes which you
might somehow or another owe. To illustrate some important points related
to our plan like essential individual sum, health costs, donations and gifts,
your son disability and the parental figure and care amounts. However, on
the off chance that the aggregate of these credits is more noteworthy than
the taxes you would owe, you won't get or be able to discount the difference
from them.
Refundable Tax Credits are amount which CRA would refund you as tax
credits in case you meet all requirements for it, whether if you have taxes to
pay or not. Yet you still need to claim them by filling a tax return form and
send it to CRA. To illustrate some point like the GST/HST credits, Working
Income Tax Benefit and your children activities fees like summer camp you
pay.
Estate
Wills
It is stated by the law of all countries, every person has to have a testament
which specifies what they own from money to properties and how they are
going to be scattered after his death. As long as the person has the ability to
be responsible for his decisions; yet he can submit a change to his
testament.
41 | P a g e
The only situation where your properties arent distributed as you wanted, is
when you die without making sure there is a valid will. In such a case, the
law has to intervene and submit changes according to specific formulas.
However, everything goes the way you decided it to be without creating any
issues and family conflicts.
Heirs, those who are mentioned in the testament, are considered the ones
who benefit from your resources.
There are two ways to disperse your estate. First, is by specifying to whom
you will to inherit it. Second, after paying off what is needed, the remainder
of what you had will be shared between the heirs.
Other types of gifts can be given by forming a trust in your will, which is
known as a willing trust.
You get to choose who and when you want to give your assets to; this is all a
part of estate planning. This plan can contain other things such as, methods
that makes it easier to manage the financial capacities of the family, indeed,
how to lessen the taxes that should be paid off. Furthermore, there is an
42 | P a g e
44 | P a g e
45 | P a g e
The executor is the one who is responsible for finalizing any paperwork and
funeral arrangements after your death, in addition to satisfying the desires of
your will. An executor has responsibilities towards the testament after death,
and these tasks are as following: heirs and beneficiaries must be gathered in
a meeting with all responsible parties and the estate settlement process
should be viewed to everyone. Besides, the executor is responsible for
completing all the necessary forms to finalize the process of probating the
testament with court proving that the testament is valid and hes the chosen
executor to do so. Also he has to finish the distribution of the remaining lands
and properties of the deceased in addition to handling any trusts mentioned
47 | P a g e
Trusts:
48 | P a g e
49 | P a g e
Education Planning:
First it came to my knowledge that you have two kids who you would like to
raise up and educate at your own expense. We as financial planners do
recommend and support this idea however, your always have to keep in your
mind that the government would also support your kids and give them
student loans.
Before planning you should definitely ask yourself many questions to support
this idea like how am I going to connect between the education plan and my
retirement income at retirement, and how that process should be noted. You
need to set goals and targets to reach those objectives.
Targets:
-
How much will be the cost of education and how numbers would be
50 | P a g e
health
and
property
insurance,
retirement
arrangement,
obligation
The costs for food and lodging, books, supplies, and transportation are
What assets does your customer have now that he or she could use for
Will the circumstance be distinctive when the tyke enlists over the
span of studies?
-
51 | P a g e
52 | P a g e
53 | P a g e
54 | P a g e
56 | P a g e
Insurance Planning:
Domain arranging, lessen the danger sway, wills, charges diminishment and
individual trusts
Notwithstanding hazard assurance, protection can assume a critical part in
riches boost. At the point when used appropriately protection can improve
the domain for beneficiaries or philanthropy, give supplemental retirement
wage or go about as an expense effective option venture. Arranging early
will open the way to a more extensive scope of chances.
57 | P a g e
Life coverage
Handicap Insurance
Basic Illness Insurance
Long haul Care Insurance
Singular Health Plans
Travel Insurance
58 | P a g e
that we
can investigate,
the
majority
of
them
offer
the
accompanying advantages:
59 | P a g e
100,000 a year, and despite the fact that, administration nursing home cost
less the holding up rundown are amazingly long and their projects have
constraints in the measure of time dispensed to every individual.
60 | P a g e
The contract is versatile, which give you scope anyplace in Canada and
U.S
The premiums are level and in light of the age of the guaranteed when
it was acquired.
The contract has distinctive disposal periods which can give us the
choice to pay lower premiums on the off chance that we pick a more drawn
out one.
prior condition exist. In any case, you have an incredible wellbeing, which we
don't have to stress over.
61 | P a g e
Home Insurance
62 | P a g e
63 | P a g e
conclusion:
As the research has demonstrated, I have discussed so far the key
components for John and Donna that may need to properly implement; as
they are essential in guaranteeing a well maintained and secured retirement.
On another hand, I have also discussed the importance of having a
successful financial plan, such as, uncertainty of social security and pension
benefits, educational planning for your children, unforeseen medical
expenses and many other reasons they might face. Making saving for your
retirement can be considered as a priority for you and your family. The
sooner you start to save money, the more time you will have to grow that
amount of money, which will make you able to stick to your goals.
64 | P a g e