MAY 2019 • $5.50
The Magazine of Influence for Financial Advisors
Goodbye Cold Calls and MailOuts. HelloTexts,Videos, and Podcasts.
Investing inYour
Faith
Welcome to the
NEW SCHOOL OF PROSPECTING! ARE YOU A FINDER, MINDER, OR GRINDER? Shannon Lee Simmons, CFP, CIM
Publication Mail Agreement # 40069004
Welcome to your new Canada Life Our companies, Great-West Life, London Life and Canada Life, have come together under one brand – the new Canada Life. It’s a brand that lets us speak to Canadians with conviction about who we are and what we believe – the potential in all Canadians. As one strong, united and ambitious brand, we can simplify what used to be complex, speed up what used to take time and bring more customer focus than ever to innovation. As the new Canada Life, it will be easier to do business with us. Our business is changing in fundamental ways, and today we’re embracing that change to do more for you, for Canadians and for the communities we call home. Together we can realize the promise of life in Canada – the promise of Canada Life. Welcome to your new Canada Life. To learn more, please visit canadalife.com/welcome or contact your local representative.
The Great-West Life Assurance Company, London Life Insurance Company, and The Canada Life Assurance Company market themselves under the Canada Life brand. London Life and design are trademarks of London Life Insurance Company. Great-West Life and the key design are trademarks of The Great-West Life Assurance Company. Canada Life and designs are trademarks of The Canada Life Assurance Company.
FORUM VOLUME 49, 2
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MAY 2019
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ISSN 1493-826X
FEATURES
10
New School of Prospecting
Goodbye seminars and cold calling. Hello texting, videos, and Instagram. Kira Vermond learns how Millennial advisors court the next generation of clients
DEPARTMENTS
COLUMNS
4
25 TAX UPFRONT
EDITOR’S JOURNAL How parents talk money with their sons versus their daughters
The federal budget made disability planning more efficient BY JAMIE GOLOMBEK
6
OPENERS Addressing senior stereotypes; how advisors should respond to clients who are considering medical assistance in dying
33 ADVOCIS NEWS Association updates and events
35 THE FINAL WORD Title protection is finally a reality in Ontario BY AL JONES
28 ESTATE DILEMMAS Complex estate documents require professional advice
COVER PHOTO: NIKKI JUMPER
Publication Mail Agreement # 40069004 Return Undeliverable Canadian Addresses to FORUM Magazine Circulation Department, 10 Lower Spadina Avenue, Suite 600, Toronto, Ontario M5V 2Z2
Know your client takes on a whole other dimension when it comes to their religion. Tamar Satov explores the way faith intertwines with financial values for many investors
BY KEVIN WARK
29 CORPORATE INSURANCE How to structure life insurance for shareholders BY GLENN STEPHENS
32 LEADERSHIP & GROWTH Yielding desired results means having a detailed process, strategy, and accountability BY KEVIN GRAY
September issue: Meet the incoming chair of Advocis
16
Have a Little Faith
22
Team Growth
All advisors must be a combination of finders, minders, and grinders some of the time. April-Lynn Levitt and Art Schooley explain how to use your strengths to evolve your practice MAY 2019 FORUM 3
BY DEANNE GAGE
Gender Money Talk
I
hail from a family of girls. In the 1970s and 1980s, my father was ahead of his time, teaching his daughters about tax returns, stocks, bonds, capital gains (I remember the days of 75 per cent!), registered and non-registered accounts — no TFSA back then. He brought home bank deposit and withdrawal slips and we learned to fill them out properly. He also taught us how to buy and sell a stock. He instilled in us the need to earn and save money for ourselves, not just our future families. But a recent Giftcards.com study has me wondering if my sister and I would have been taught differently if my parents also had a son. The results revealed a discrepancy between what sons and daughters learn about money from their parents. The study’s researchers surveyed 1,000 U.S. parents who had at least one child between the ages of 5 and 18. They found boys were more likely to learn about building wealth by investing. Girls, on the other hand, were usually taught about budgeting and “fiscal restraint.” The study noted: “Male youths were more likely to receive advice related to credit scores, taxes, and bank accounts. Boys also learned about donating from their parents more often than girls, even though women consistently surpass men in charitable giving.” Parents were also more inclined to give their sons a greater sum of money for allowance, chores, or special events. These results could partially explain why some women ultimately abdicate the majority of financial decisions to their future partners. Statistics around the world have shown that most men in male-female partnerships maintain the overall responsibility for household financial decisions, according to HSBC’s Future of Retirement report. “The only area where women assume sole financial control is purchasing groceries and day-to-day purchases,” the report notes. Men in these partnerships, meanwhile, are more likely to make the investment choices and decide upon and purchase the big-ticket items. Whether this is due to convenience, 4 FORUM MAY 2019
FORUM PUBLISHER: Peter Wilmshurst advocisforum@gmail.com EDITOR: Deanne Gage dgageforum@gmail.com COPY EDITOR AND PROOFREADER: Alex Mlynek ART DIRECTOR: Giselle Sabatini artdirector@forum-mag.ca ADVERTISING: Peter Wilmshurst advocisforum@gmail.com Tel: 416-766-4273 Fax: 416-760-8797
TFAAC BOARD OF DIRECTORS CHAIR Al Jones, CFP, CLU, ICD.D, ACCUD VICE CHAIR Abe Toews, CFP, CLU, CH.F.C., CHS PAST CHAIR Jim Virtue, CFP, CLU, CA SECRETARY Rob Eby, RRC, CFP TREASURER Catherine Wood, CFP, CLU, CHS CHAIR, THE INSTITUTE Stephen MacEachern, CFP, CLU, CH.F.C., CHS CHAIR, THE CLC David McGruer, CFP PUBLIC DIRECTOR Geoffrey Creighton, BA, LL.B, C.DIR, CIC.C DIRECTOR AT LARGE Eric Lidemark, CFP, CLU, CH.F.C, CHS DIRECTOR AT LARGE Kevin Williams, CFP, CLU, RHU DIRECTOR AT LARGE Patricia Ziegler, CHS, EPC
confidence, and/or knowledge is certainly up for debate. My own household is the complete opposite of this study. My husband and I are now raising two girls of our own and are building on the financial lessons I learned from my family. For those of you who advise clients with young families, ask them if there’s a difference in what they teach their sons versus daughters. It could mark the start of a fascinating financial literacy discussion.
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On April 5, we successfully launched eFORUM, our first newsletter. We feature brand-new content with up-to-date tax and estate planning news, strategies to build your practice, and help you get up to speed on technology. FORUM columnists Jamie Golombek, Doug Carroll, Kevin Wark, Masood Raza, and Bryce Sanders all contribute, writing about the issues of most importance to you. We also have new contributors whom I know you’ll enjoy. eFORUM is only available to Advocis members at this point, but I’d be happy to forward you a copy of our inaugural effort for a look-see. Just email me at dgageforum@gmail.com.
PRESIDENT & CEO Greg Pollock, CFP FORUM is published four times annually by The Advocis Publishing Group, 10 Lower Spadina Avenue, Suite 600, Toronto, Ontario M5V 2Z2 TEL: 416-444-5251 or 1-800-563-5822 FAX: 416-444-8031 FORUM is mailed to all Association members, the subscription price being included in the annual membership fee. Address changes can be made through info@advocis.ca or by calling member services at 1-877-773-6765. The opinions expressed in articles and advertising are those of the authors/advertisers and not necessarily those of FORUM or the Association. Material of a technical or semi-technical nature may become invalid because of later changes in law or interpretation. The Association is not responsible for obsolescence of FORUM articles whose content should be checked by the reader before implementation. Requests for permission to reprint articles are to be addressed in writing to the editor of FORUM. ™ Trademark of The Financial Advisors Association
of Canada carrying on business as Advocis.
FORUM EDITORIAL ADVISORY BOARD MICHAEL BERTON, CFP, RFP, CLU, CHS Assante Financial Management Ltd. LEONY DEGRAAF HASTINGS, CFP, EPC deGraaf Financial Strategies NICHOLAS LANDRY, CEBS, CHS, RCIS BFL Canada - CSI ROBERT MCEACHERN, CFP, CLU, CH.F.C. McEachern Financial IZUMI MIKI-MCGRUER, CFP, CLU, CH.F.C., CHS Freedom 55 Financial
PHOTO: DANIEL EHRENWORTH
EDITOR’S JOURNAL
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OPENERS Fodder For the Water Cooler NEW ADS SPEAK TO SENIORS’ SENSIBILITIES
L
ike younger generations, seniors loathe stereotypes. To address this, HomeEquity Bank is trying to eliminate formulaic labels and find better ways to talk to clients about heavily regulated products, particularly reverse mortgages. Yvonne Ziomecki, executive vice-president, marketing and sales with HomeEquity, explains that to qualify for a reverse mortgage, clients must be age 55 years or older. The loan allows people to convert up to 55 per cent of their home’s value into tax-free cash. “That’s our sweet spot and we would like to think we understand the demographic very well especially when it comes to financial service needs,” says Ziomecki. HomeEquity launched a series of light-hearted ads last year and when clips were shown to a focus group of “older Canadians” characterizing them as being educated, energetic, and enthusiastic instead of frail and helpless, they had a 26 per cent greater connection and 28 per cent better memorability than average. Ziomecki says the research came out with four main insights that advisors should take to heart: 1. Forget stereotyping; ads that show older Canadians as frail and in pain don’t resonate well with this generation. 2. The demographic does respond well to nostalgia tailored to their generation. 3. Selective parenthood memories also work well with this group. 4. Like most consumers, Boomers appreciate information in bite-sized pieces. “Financial services products have become more complicated; there’s a lot more disclosure and documents are longer for regulatory purposes,” she says, “but this may have made the products more difficult and more complicated to understand.” Ziomecki says the biggest takeaway for financial advisors is to be thoughtful about what they’re discussing with clients, be clear, and don’t jump from one topic to another. She says advisors should also periodically check with clients to make sure they understand what is being discussed. “The wealth is with older people,” she says. “We all need to know how to talk to them, engage with them, how to promote products, how to live better retirements, and it’s not going to happen with Millennial advertising — it’s just going to alienate them.” — Susan Yellin 6 FORUM MAY 2019
WOMEN STILL EXPERIENCE WAGE GAP: CIBC STUDY
W
omen may be controlling an increasing amount of wealth in Canada, but many still feel there is a major wage gap between what they earn and what their male counterparts receive. Since the 2008 recession, more women aged 25 and over are actively participating in the economy, accounting for 52 per cent of job growth in full-time positions since 2008, according to a recent report from CIBC Capital Markets. On top of that, women who are 55 years of age or older have seen labour market participation rates increase to almost twice those of men. “Today 41 per cent of women (single, divorced, widows, and women responsible for investment decisions) control no less than $2.2 trillion of financial assets,” the report says. “That number is expected to rise quickly, as the cohort of women with stronger labour incomes and retirees grow. We estimate that by 2028, women will control just under $3.8 trillion or more than one-third of total financial assets and more than double that number if we include real estate assets.” At the same time, a national survey of employed Canadians by Angus Reid Institute found gender pay gap a serious issue for four out of five women. About half of working men say they agree. Having said that, the survey also indicates a majority of both men and women said they would support an equal pay law for companies with more than 25 employees. More than 60 per cent of working Canadians say they think they are paid fairly, while one in five say a gap in pay based on gender is indeed alive in their own workplace. The poll suggests that women are more likely to feel this way than their male counterparts. — S.Y.
UNDERWRITING POV BY WENDY STOCKFORD
WHEN A CLIENT IS CONSIDERING MAID
PHOTOS: ISTOCKPHOTO
Y
ou assist your clients through diverse life stages, such as putting insurance policies in place for families, managing their savings and investments, collaborating on a retirement income strategy, and navigating the insurance claims process. Most of these life-changing events have something in common; they are occasions to celebrate. But how should advisors respond to clients who are considering medical assistance in dying (MAID), formerly referred to as physician assisted suicide? June 17, 2017 marked the one-year anniversary of the passage of legislation permitting medical assistance in dying in Canada. The federal government reports that more than 3,700 medically assisted deaths took place between December 10, 2015 and December 31, 2017 — the majority in hospital. The average MAID patient is a 73year-old senior, nearly equally split between female (51 per cent) and male (49 per cent), and the most common condition is cancer (neoplasm, at 56.8 per cent). Next are neurological illness such as multiple sclerosis or amyotrophic lateral sclerosis (23.2 per cent), and circulatory/respiratory system ailments (10.5 per cent). Ten per cent of MAID deaths were due to other underlying medical conditions. From an industry perspective, the Canadian Life and Health Insurance Association (CLHIA) released their position in 2016 that MAID was not expected to have a significant impact on the industry, provided it took place in accordance with the rules and processes set out by the federal, provincial, and territorial governments. Basically, in instances of medical assistance in dying: 1. A suicide exclusion in a life insurance policy will not apply to MAID, provided that the laws respecting the MAID process were followed. As part of an insurer’s claims adjudication, we’d be confirming that death did occur within the requirements of the MAID rules. 2. MAID does not prevent the insurer from investigating the validity of the coverage at time of claim, as may normally occur. Such an investigation is typically undertaken to confirm that the medical information provided in connection with the person’s application for insurance was accurate and complete.
3. Insurers will still need to know the underlying cause of death — that is, the reason why the person elected to have medical assistance in dying — and the circumstances under which the death took place. An Attending Physician’s Certificate would be required to determine the manner and cause of death, and would be compared to the answers on the medical questionnaire. As can be seen, MAID should not pose a significant risk to insurers from an underwriting perspective because applicants are generally required to accurately and completely answer health questions upon application, and insurers require confirmation of the underlying cause of death at time of claim. Neither is MAID a factor when adjudicating life insurance claims, as CLHIA has expressed the industry position that the typical suicide exclusion that appears in many insurance contracts would not apply to MAID. However, the underlying cause of death is still a key consideration, notably if the client misrepresented their health or failed to disclose a pre-existing condition at the time of application. According to MAID legislation, the federal minister of health must publish guidelines on what information to include on death certificates in cases of medical assistance in dying. However, death reporting and investigation are under provincial and territorial jurisdiction, and many have adopted their own approaches. With that said, the underlying cause of death is a key piece of information that must be collected and analyzed. You can therefore be confident in following your usual business practices when providing the professional financial services your clients need at a critical time in their lives. But don’t neglect your own grief related to the pending loss of a long-time client and friend. Dying with Dignity Canada (www.dyingwithdignity.ca), a national human-rights charity, offers personal supports and bereavement resources, as well as a free “Advance Care Planning Kit” that can help your clients document their wishes for end of life. MAID is still in its very early days in Canada, and many questions remain. Health jurisdictions across Canada are collecting MAID data, including patient-related demographics, diagnoses prompting the MAID request, data of first request for MAID, and type of facility where MAID was provided. Future public health policies are likely to evolve, as more is known and understood about the MAID experience. WENDY STOCKFORD is director of wealth and life claims, operations and customer service, individual customer, for Canada Life.
MAY 2019 FORUM 7
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Responsible Investing is Growing Around the World
OPENERS
private equity houses now have teams 35% ofdedicated to responsible investing (RI)
DID YOU KNOW? 77%
respondents have already adopted or are currently 91% ofdeveloping an RI policy
respondents use or are developing key 72% ofperformance indicators to measure performance
of Canadians have made saving a priority over paying down debt
41% put their funds into retirement
SOURCE: PWC, FEBRUARY 2019
6 in 10 Consumers Willing to Share Significant Personal Data with Banks and Insurers in Exchange for Lower Pricing Consumers willing to share personal data in select scenarios
37% save their money to spend on their lifestyle 30% save money for future family or a child’s education 26% put money away for an emergency fund
Receive competitive/ lower prices
59% 24% 17%
Faster, easier loan approval process Personalized offers based on location Personalized services/ information that help reduce risk of inury, loss Some (location data) and A lot (lifestyle habits)
SOURCE: EDWARD JONES, 2019
53% 28% 18% 53% 23% 24% 53% 26% 20% A little (income data)
None
SOURCE: ACCENTURE, 2019
A NATIONAL CONFERENCE FOR INSURANCE AND FINANCIAL ADVISORS A high energy day with expert Advisors presenting quick-hitting TED Talk style sessions. Be prepared to leave energized and motivated to try new ideas in your practice.
June 25, 2019
Sheraton Cavalier, Saskatoon To register: http://www.advocisnorthcentralsask.com/landing-sfs
COVER STORY
Shannon Lee Simmons, CFP, CIM
10 FORUM MAY 2019
The New Schoolof
Prospecting Goodbye seminars and cold calling. Hello texting, videos, and social media. Kira Vermond learns how savvy advisors court the next generation of clients
PHOTOS :(left) NIKKI JUMPER; (right) ISTOCKPHOTO
A
few months ago on the first day of April, New School of Finance, a Toronto-based adviceonly financial planning and coaching firm, published a social media post that caused more than one follower to take notice. “Don’t forget that your 2018 tax returns are due TODAY! File by 11:59EST tonight to avoid facing any penalties,” the post read cheerfully — before letting the reader in on the ruse a few lines down with, “Just kidding! April Fool’s!” “We got a lot of comments,” says Shannon Lee Simmons, CFP, CIM, who is the company’s 34-year-old founder. “It was an effective joke, all in good fun.” Simmons, who started her now eightemployee company in 2014, is part of the firm’s so-called “faculty of financial awesomeness” according to the website, which uses the same cheeky tone throughout its pages. There are pleas for readers to “get your financial butt in gear!!” an admission to being “crazy PASSIONATE about financial literacy,” and a revelation that Simmons drops a dollop of red nail polish on the top corner of every calculator she has ever owned. (Why? No idea. She just does it.) Meanwhile, between posts about childproofing finances and the hidden cost of home ownership, the company’s Twitter feed waxes poetic about Oreo cookie flavours. “That piece has absolutely nothing to do with finance, but people love it! We get the most responses to the Oreo wars than anything else,” she says. While the fun and somewhat irreverent marketing tone may seem unexpected or even perilous in an industry bent on conveying a steadfast, conservative, and reliable air — think websites awash in greys and blues — according to Simmons, going against the longstanding grain is precisely the point. The firm’s bread and butter
clients are between the ages of 27 and 47, mostly Millennials but some GenXers, too. A relaxed, conversational tone goes a long way with them. The trick, however, is successfully following sales leads and prospecting this next generation of clients in the first place.
A GROWING NECESSITY Turning Millennials into clients is no longer simply a savvy business move for a few forward-thinking advisors, but a growing necessity for nearly everyone. Today, there are more than 7.3 million Millennials, those born between 1981 and 1996, living in Canada, making them the largest demographic group since the Boomers. And while they might be years away from becoming coveted high-net-worth clients — they’ve been labelled the “brokest generation” after all — if advisors like Simmons stick with them long enough, offering insight and support along the way, many will get there eventually. Even advisors and planners who are well into their careers and with a healthy client base are wise to continually prospect as a way to deal with attrition as current clients die, divorce, or move on for other reasons. Adding younger people to the roster means developing client relationships that will last for years longer. But older prospecting methods that worked in the past — think cold calling, direct mail, or seminars — aren’t necessarily effective now. According to many advisors who are actively courting Millennials, these in-your-face approaches are often a turn-off for the younger set. Prospecting the next generation of clients is so subtle, despite being just as reliant on a good systematic method of developing and qualifying sales leads, it hardly looks like prospecting at all. MAY 2019 FORUM 11
COVER STORY Take the “brunch effect.” That’s what Simmons calls word-of-mouth leads that come from current clients. She says her team started calling it that after asking warm leads to tell them how they heard about New School of Finance. She discovered that many of them were simply talking to their friends — her clients — on the weekend over brunch and were intrigued. Checking out her fun, chatty website and social media posts enticed them to reach out soon after. “It’s that word-of-mouth piece that’s so important with young people,” she says, explaining that with so much conflicting financial information on the Internet, many younger people new to investing and money management don’t know what to trust. Developing these customer-driven leads — where most of her new clients come from these days — doesn’t require advertising or high-pressure sales at all. What it does require is simply doing good work for current clients and making them feel good about their futures. No shame. No judgment. If you wow them, others will come. “I can’t stress it enough how much I agree with that. We have a waiting list because people can’t wait to send their friends,” says Simmons.
Julia Chung, CFP
A NEW SPIN ON OLD CHESTNUTS
Daniel Martens
MEET THEM WHERE THEY ARE Corey Ferrier, a 31-year-old CFP and national sales manager for Raintree Financial Solutions in Orangeville, Ont., agrees that old prospecting methods are going the way of the dinosaur. After all, advisors can’t call the majority of people in the phone book anyway since they’re either on a “do not call Corey Ferrier, CFP list,” no longer have a listed landline, or even a landline at all. “I swear, the 10 people left in Ontario with a home phone must be getting a lot of calls,” he says, laughing. So what works with Millennials like him? Efficiency and a having a healthy respect for your potential customer’s time. “We Millennials like our work-life balance. When we’re home with our families or with our friends, we really value that time and we don’t just want to give that up,” he says, mentioning that younger people often don’t want the hour-long evening sit-down 12 FORUM MAY 2019
or sales pitch. “You have to meet them on their terms. If they want to do a video conference instead, do a video conference,” Ferrier explains. And be prepared for texts. Lots of texts. If a warm lead turns into a hot prospect, he recommends setting up a 20-minute videoconference on a lunch break so the conversation doesn’t eat into family time. And if you want to pick up the phone to make a call? Text or message first and book a time, otherwise you’ll likely be sent to voice mail.
Meanwhile, Julia Chung, CFP, CLU, FEA, TEP, and Vancouver-based partner at Spring Financial Planning, has found new ways to update old prospecting tools that appeal to younger generations. Like Simmons’s website, hers skews younger too, likely because her marketing director is a Millennial and is aware of what appeals to others in her age group — even if the advisors, mostly Gen-Xers, have been a little unsure in the past. “The videos on our website? None of us wanted to do them. We were, ‘Ew, yuck. Nobody wants to see me talk for two minutes,’ and she said, ‘Yes, they do and you’re doing it,’ ” she says of the marketing director. Then there’s the company’s newsletter. While it gives solid financial information, it also uses an updated, friendly, conversational tone. It’s a fun read. The team sits down at the beginning of each year and creates a thorough content calendar and maps out a plan. Partner Sandi Martin, CFP, who lives and works a couple of hours north of Toronto, runs a popular podcast, too and isn’t shy to show off her personality on social media. After following her and creeping her posts, many new clients say they feel like they already know her before she starts working with them. Daniel Martens, a 32-year-old financial advisor and founder of Martens Financial in Stratford, PEI, says he also relies on traditional prospecting methods but gives them a new twist. Although he’s a new dad, he also volunteers to get out into the community and runs seminars. But rather than hosting runof-the-mill, general talks about RRSPs versus TFSAs, he focuses them specifically toward the people he wants to reach, often young
parents looking for, say, a way to maximize their child tax credits. Some advisors go even further with seminars for Millennials, turning them into social meet-ups with names like Wine Wednesdays or Pint Thursdays. New School of Finance runs online DIY courses with names like “Budget with Your Boo” (money management for couples) for $97. Even though so much of prospecting and service is being done online these days, Martens thinks face-to-face is still important for actually keeping clients, particularly in down markets. “If we get away from that, we’re not going to connect with our clients. We just become another person they’ve dealt with along the way,” he says. “They may as well go robo or go to the bank.” Even so, it’s still important to meet Millennials where they are in order to reach them — online. Simmons tries to increase her
VARIETY PACK
5 prospecting tips and tricks to give you the edge with younger clients 1. Make social media social Social media — all of those Facebook, Instagram, Twitter, LinkedIn, Snapchat, and who knows what other options on the horizon — can either help or hinder prospecting efforts. Social media is about being social and personable, says Julia Chung of Spring Financial Planning, who maintains that her colleague Sandi Martin uses the platforms particularly well. Martin is genuine and shares her opinions openly, knowing that she’s automatically drawing clients who “get” her. “A lot of people treat social media like it’s an advertising space, but she treats it like a relationship space and an opportunity to find peers,” notes Chung.
followers online so prospective clients see those numbers as an indication that she’s trustworthy and has something to say. Meanwhile, Ferrier recommends using very targeted advertising through Facebook, LinkedIn, and Google to grab the right eyeballs. Introductory LinkedIn messages can help, too, if they find the right person at the right time. Just recently, one of the advisors he works with landed a $7million prospect that way. After a few online messages, they were chatting on the phone and meeting in person. All in a span of three weeks. “It’s up to the two of them to close now,” he says, “but it does work.” KIRA VERMOND is a veteran financial journalist based in Guelph, Ont.
3. Think it through Especially at the beginning of your career, it’s tempting to try to reach out to every kind of client, from recent grads to empty nesters, to build up a client base. But it pays off to envision the one or two main demographics you’re trying to reach and market to them. Knowing who those prospects are, though, takes some careful thinking. Chung says her firm’s staff reviews their corporate values every year at their retreat and then ensures all their marketing and communications incorporate them. To reach their younger clients, they keep things casual but professional. “Older institutions are still thinking people want big and safe,” she says. “But [Millennials] genuinely want financial institutions that are full of humans who are going to listen and behave in a fiduciary way.”
4. Make sure you’re getting the most up-to-date-training Corey Ferrier is now primarily working with other advisors as their sales manager and, as a Millennial himself, he knows the best ways to reach his peers. That means using social media well and targeting online ads. His age and outlook are a boon for the company, which is trying to figure out where the industry and prospecting are going. It pays to find other forward-thinking firms to work for, too. “If you’re getting trained on old-school paperwork where you actually have to sign with a pen, that’s a bad sign,” he says.
5. Think young and listen 2. Save telephone calls for later If you’re hoping to gather information about warm leads by enticing them with a newsletter, make sure your sign-up forms are simple and short. A name, email address, and one or two other targeted questions should do the trick. Don’t bother asking for a phone number. That’s a turnoff for Millennials who worry you’ll call them. If you feel you must ask for a number, ask for the best one to text.
While many new advisors are told they should find clients who fit their own demographic, Chung isn’t buying it. At least not anymore. Back in her 20s, she received some harsh feedback from a mentor stating that, as a Chinese-Canadian woman, clients weren’t going to see themselves in her and want to do business. For a while she believed it. “But the reality is, all people want to be met where they are.” In other words, even though some 32-year-old prospects might initially feel most comfortable talking to a thirtysomething advisor, that doesn’t mean a 50-year-old advisor doesn’t stand a chance. Empathy and active listening go a long way no matter who you are. “I mean, 90 per cent of my clients don’t look anything like me and they’re not my age,” says Chung. — K.V.
MAY 2019 FORUM 13
L O N G - S TA N D I N G C L U D E S I G N AT I O N H O L D E R S
The Institute for Advanced Financial Education honours longstanding CLU® holders – those who have held their designation for 25 years or more—demonstrating a longtime commitment to excellence in financial advice. We are honouring CLU designation holders who are celebrating milestones in five year increments. 25-YEAR CLU DESIGNATION HOLDERS
Lida Hoffmann CLU,CH.F.C. Mimi (Micheline) Rogers CFP,CLU,CH.F.C., CHS,CEA Bradley Holt CFP CLU CHS CH.F.C. Stuart Rowles CFP,CLU,CH.F.C.,CHS Diane Huba CLU Kelly Aikens CFP,CLU,CH.F.C.,CEA Nandini Roy CFP,CLU,CH.F.C. Ronald Johnston CFP,CLU,CH.F.C. Pierre Baliki CFP,CLU,CH.F.C. Sin-Eng Siow CFP,CLU,CH.F.C. David Juvet CFP,CLU,CH.F.C.,CHS Murray Biggar CLU,CH.F.C. Raj Sircar CLU Brian Kalyn CFP,CLU,CH.F.C. Susan Blais CFP,CLU,CH.F.C.,CHS Daryl Smith CFP,CLU,CH.F.C. Manish Kanani CFP,CLU,CH.F.C. Dennis Boodram CFP,CLU,CH.F.C. Richard Squires CLU,CH.F.C. Richard Kizell CFP,CLU,R.F.P. Robert Boyd CFP,CLU,CH.F.C. Kim Stanley CFP,CLU,CH.F.C. Darren Knott CFP,CLU,CH.F.C. John Boyd CLU,CH.F.C. Michael Steele CFP,CLU,CH.F.C. Stuart Libin CFP,CLU,CH.F.C. Robert Buness CFP,CLU,CH.F.C. Andrew Stevenson CFP,CLU,CH.F.C. Peter Liden CFP,CLU,CH.F.C. Jeffrey Burchill CFP,CLU,CH.F.C. Michael Stewart CFP,CLU,CH.F.C. Bruce Lindsay CFP,CLU,CH.F.C. Carleen Carels CFP,CLU,CH.F.C. Susan Stobart CFP,CLU,CH.F.C. Bob Lloyd CFP,CLU,CH.F.C. Allan Chapman CFP,CLU,CH.F.C. Robert Taylor CFP,CLU,CH.F.C. Joe Lopes CFP,CLU,CH.F.C. Wah Chew CFP,CLU,CH.F.C. Joe Terejko CFP,CLU,CH.F.C., CHS David Luke CFP,CLU,CH.F.C. Jay Corrado CFP,CLU,CH.F.C. Michael Thorne CFP,CLU,CH.F.C. Kevin MacDonald CFP,CLU,CH.F.C.,CHS Robert Corrigan CLU,CH.F.C. Richard Todd CFP,CLU,CH.F.C. George MacKenzie CFP,CLU,CH.F.C.,CHS Alix Crispe CFP,CLU,CH.F.C. Brent van Ryzewyk CFP,CLU,CH.F.C.,CHS,CEA Moez Mahedi CLU,CH.F.C. Steve Cutt CFP,CLU,CH.F.C.,FMA Lee Vardy CFP,CLU,CH.F.C. Mary McGregor CFP,CLU,CH.F.C. Caron Czorny CFP,CLU,CH.F.C.,CHS,CEA Kent Wiebe CFP,CLU,CH.F.C. Angus McLarty CFP,CLU,CH.F.C. Edgar De Souza CFP,CLU,CH.F.C. Joann Wong Bittle CFP,CLU,CH.F.C. Claude Menard CLU,RHU Brent Dennison CFP,CLU,CH.F.C.,CHS Robert Morris CFP,CLU,CH.F.C. 30-YEAR David Dickinson CFP,CLU,CH.F.C. Brian Morton CFP,CLU,CH.F.C. CLU DESIGNATION HOLDERS Peter DSouza CLU Joginder Narula CFP,CLU,CH.F.C. With more 5,000 CLU® and CHS designation holders in good standing. The institute for advanced financial education is the leading designation body in canada for Duane Ebythan CFP,CLU,CH.F.C. Mary Anderson CFP,CLU,CH.F.C. Kenneth Nesbitt CFP,CLU,CH.F.C. financial services practitioners in the specialty areas of advance estate and wealth transfer, and living benefits. The institute provides a platform of standards and advanced knowledge through designation programs and accreditation services. Institute destinations speak powerfully of a practice that isBall builtCLU,CH.F.C. on knowledge and a belief in the Gilman Ennis CFP,CLU,CH.F.C. Philip Michael Noc CFP,CLU,CH.F.C.,CIM continuous refinement of that knowledge. John Esler CFP,CLU,CH.F.C. William Benson CLU,CH.F.C. William Odishaw CFP,CLU,CH.F.C.,CHS John Fahie CFP,CLU,CH.F.C. Henry Block CFP,CLU,CH.F.C. Gary Olson CLU,CH.F.C.,CHS,CFP Ralph Fege CLU, CH.F.C.,CHS Raymond Bourgeois CFP,CLU,CH.F.C.,CHS John Parkes CLU Kevin Flynn CLU,CFP Jeffrey Cait CFP,CLU,CH.F.C. Thomas Pilkington CFP,CLU,CH.F.C. Douglas Foster CLU,CH.F.C.,CHS Robert Clark CFP,CLU,CH.F.C. Gerald Preston CFP,CLU,CH.F.C. Alexander Fraser CFP,CLU,CH.F.C. Robert Craig CFP,CLU,CH.F.C. Nick Pszeniczny CLU,CMP Stephen Fretwell CLU Randolph Cummings CLU Anna-Marie Rasmussen CFP,CLU, Gord Fulton CLU,CH.F.C. Hugh Desjardins CLU,CH.F.C. CH.F.C.,CHS
The Institute for Advanced Financial Education (The Institute™) is the leading designation body in Canada for financial services practitioners in the specialty areas of Advanced Estate and Weatlh Transfer, and Living Benefits. The Institute provides a platform of standards and advanced knowledge through designation programs and accreditation services.
Holding a CLU designation is proof of commitment to higher standards. Even under the most difficult economic circumstances, longstanding CLU designation holders have continued to help Canadians build and preserve their wealth.
James Douglas CFP,CLU,CH.F.C. Kevin Dunphy CFP,CLU Darrell Ert B Comm,CLU,FEA Mark Goldasic CLU Gay Griffith CLU,CH.F.C. Paul Grimes CFP,CLU,CH.F.C. Charles Grossholz CFP,CLU,CH.F.C. Barry Grossman CFP,CLU,CH.F.C. Edward Harp CFP,CLU Richard Harvey CFP,CLU,CH.F.C. Gwen Harvey CFP,CLU,CH.F.C. Elizabeth Hesson CFP,CLU,CH.F.C. Robert Houle CFP,CLU,CH.F.C. Lowell Jones CLU Karl Jung CLU James Kraft CA,CFP,CLU,CH.F.C.,TEP Mansuralli Lalani CFP,CLU,CH.F.C. Kenneth Lam CFP,CLU,CH.F.C. Lydia Lapointe CLU,CH.F.C. David Lewis CFP,CLU,CH.F.C. David Lim CLU,CH.F.C. Thomas Liska CLU,CH.F.C.,CFP,RFP John McAleer CFP,CLU,CHS Glenn McAthey CFP,CLU,CH.F.C.,CHS Peter Mccormick CLU Leo Mccready CLU,CH.F.C. Douglas Menzies CFP,CLU,CH.F.C. Allan Minaker CFP,CLU,CH.F.C. Robert Morton CLU Paul Mowbray CFP,CLU James Murray CFP,CLU,CH.F.C., CHS Sandra Pollack CFP,CLU,CH.F.C.,TEP Peggy Pratt CFP,CLU,CH.F.C. Lee Raine CFP,CLU,CH.F.C. Michael Rickaby CFP,CLU,CH.F.C. John Robinson CFP,CLU,CH.F.C. Derek Rundell CLU,CH.F.C. Roland Seguin CFP,CLU,CH.F.C. Brett Simpson CFP,CLU,CH.F.C.,RHU
Jack Snedden CFP,CLU,CH.F.C. Mark Stefan CFP,CLU,CH.F.C.,CHS Steven Suchorab CFP,CLU,CH.F.C. Clark Taylor CFP,CLU,CH.F.C. John Thompson CFP,CLU,CH.F.C. Chris Thompson CFP,CLU,CH.F.C.,CHS Alexander Thomson CFP,CLU,CH.F.C. Clifford Wiegers CFP,CLU,CH.F.C. Kent Wiebe CFP,CLU,CH.F.C. Joann Wong Bittle CFP,CLU,CH.F.C.
40-YEAR CLU DESIGNATION HOLDERS Ted Austin CFP,CLU,CH.F.C.,EPC W Callery CFP,CLU,CH.F.C. Randy Chevalier CFP,CLU,CH.F.C. Sat Chopra CFP,CLU,CH.F.C. Chuck Corrigan CFP,CLU,CH.F.C. Hal Couillard CFP,CLU,CH.F.C. Ronald Ewasiuk CFP,CLU,CH.F.C.,RFP Ronald Fennell CFP,CLU,CH.F.C. Robert Fitzsimmons CFP,CLU,CH.F.C. Robert Fleischacker CFP,CLU,CH.F.C.,CHS Arliss Francis CLU Paul Greene CFP,CLU,CH.F.C.,CIM Andrew Hamilton CFP,CLU CH.F.C. Robert Hansen CFP,CLU,CH.F.C. Alan Harris CFP,CLU,CH.F.C. Gerald Hodson CLU Daniel Hynek CFP,CLU,CH.F.C.,CHS Dieter Jaster CFP,CLU,CH.F.C. Tom Kalvik CFP,CLU,CH.F.C. David MacFadyen CFP,CLU,CH.F.C. Brian Mallard CLU,CH.F.C.,R.F.P. Christopher Matthews CLU Douglas Maybee CLU,CH.F.C. Mark Rowland CLU Jack Shaffer CFP,CLU,CH.F.C. Leslie Smith CLU
Jack Stratton CLU Wynn Sweatman CFP,CLU,CH.F.C. Peter Von Stackelberg CFP,CLU,CH.F.C. Andy Watson CFP,CLU,CH.F.C. John Wilson CLU,RHU Matthias Yeung CLU
50-YEAR CLU DESIGNATION HOLDERS Charles Fiszman CLU Richard Giuliani CFP,CLU,CH.F.C. John Irviss CFP,CLU,CH.F.C. Lorne Wotton CLU
60-YEAR CLU DESIGNATION HOLDERS Bill R. Andrew CLU Ross Durant CLU, CH.F.C. Rayner McCullough CFP,CLU
65-YEAR CLU DESIGNATION HOLDERS Hugh Bailey CLU
For more information on the CLU designation, please visit www.iafe.ca/clu
The Institute for Advanced Financial Education™ (The Institute™), CLU® and CH.F.C.® are trademarks of The Financial Advisors Association of Canada (TFAAC). The Institute is a wholly owned subsidiary of Advocis®. Copyright © 2018 TFAAC. All rights reserved. Unauthorized reproduction of any images or content without permission is prohibited. Financial Planning Standards Council is the marks licensing authority for the CFP® marks in Canada, through agreement with Financial Planning Standards Board Ltd. CAIB® is a registered trademark of the Insurance Broker Association of Canada. F.Pl. is a registered trademark of the Institut québécois de planification financière. FEA® is a registered trademark of the Family Enterprise Xchange.
ETHICS
Have a Little
Faith
Know your client takes on a whole other dimension when it comes to their religion. Tamar Satov explores the way faith intertwines with financial values for many investors
16 FORUM MAY 2019
PHOTO: ISTOCKPHOTO
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ewfoundland business owners Alma and Keith Greeley have always put their money where their faith is. For them, that included living off the income from Keith’s St. John’s-based electrical contracting company and donating all the proceeds from their other business, a holding company of rental properties, to charities that support their Christian beliefs. When the couple started to plan for retirement seven years ago, they asked their financial advisor at a national firm for strategies on how they could start liquidating the holding company’s assets, while continuing to gift money to the Kingdom of God throughout their retirement. What they got instead was raised eyebrows and a lack of understanding. “She just shook her head and asked us why we would want to give our money away,” recalls Alma. “She didn’t understand that when you have a calling, you want to follow through with it.” Thankfully, through their volunteer work with the International Alliance for Missions, the Greeleys met Lorne Robinson, CFP, a former pastor who had built a successful practice in Corner Brook, Nfld. He advised them to invest money from the sale of their properties in the Canadian National Christian Foundation, which acts like a private foundation but at a fraction of the cost. As they liquidated their properties, they could make tax-deductible donations to be invested with CNCF, and every year for perpetuity they would be able to choose which Christian charities to support using the investment earnings. “We were so excited that there was a way for us to continue to give,” says Alma, 62, who recently moved with Keith to Springdale, a community of less than 3,000 people near the province’s centre. “We decided to trust Lorne with all of our investments. He understood what we wanted to do, and he supported us.” Knowing your clients and their goals is one of the most important aspects of being a financial advisor. And, as Robinson’s relationship with the Greeleys shows, that can include understanding their lives from a faith-based perspective — whether that be Christian, Muslim, Jewish, Mennonite, Hindu, or any other religion. “Clients are looking for financial and investment advice that align with their values,” says Robinson, who left Newfoundland in 2015 to become national director of Kingdom Advisors Canada in Ottawa, an international certification program designed to better equip financial advisors with ideas that inform a Christian world view. That means not only knowing what the scripture says about finances (e.g., spend less than you earn: “The wise have wealth and luxury, but fools spend whatever they get,” Proverbs 21:20 NLT), but also understanding the importance of living a life based on calling and being a steward of God’s resources on Earth. “It’s not what do I want to do with my money, but what would God want me to do with His money,” says Robinson. As such, there are obvious parallels between faith-based and socially responsible investing (SRI): screening out companies that are bad for society or detrimental to the Earth, based on environmental, social, or governance (ESG) considerations. But as clients come to understand how they can make a difference in their com-
munities and around the world through their financial decisions, it’s only natural that they would want to bring the specific ideals of their faith to the table as well. For example, in addition to these widely held concerns for fairness, justice, and equity, Islamic law has numerous guidelines for financial products and investments to be considered sharia-compliant or halal. This includes the prohibition of interest (riba), contracts with excessive uncertainty (gharar) and zero-sum transactions such as gambling (maysir). “Halal investing is socially responsible in its avoidance of particular products and industries,” says Khaled Sultan, CFA, an investment advisor and portfolio manager at CIBC Wood Gundy Financial in London, Ont. “Meeting sharia (or halal) requirements for investing means selecting only certain companies based on the industry they operate in and on their financial ratios.” In other words, halal investments cannot support companies with significant revenues from alcohol, tobacco, pork-related products, interest-based financial services, weapons, gambling, or pornography. Similarly, the practical guidelines for all aspects of Jewish life, including finances, comes from the Talmud, the primary text of Orthodox rabbinic law. And at 2,711 two-sided folio pages, it’s pretty specific, says David Wm. Brown, CLU, CHS, TEP, partner at Al G. Brown & Associates in Toronto, a third-generation financial services firm with a predominantly Jewish client base. While the Talmud generally highlights that same biblical concept of being a custodian or steward of God’s Earth, it also delves into the importance of diversifying assets between land, commerce, and cash; educating children about finances from a very young age; how money should be spent (10 per cent each on charity, community, and savings, 20 per cent on investments, and 50 per cent on daily spending); and repairing the world. “Investments are integral to the essence of Jewish life — but it’s all about the purpose and meaning of the investment,” says Brown, adding that some prohibitions include investing in companies that support child labour, human trafficking, pollution, and cruelty to animals. With all these specific faith-based financial parameters, it’s clear why clients would be interested in having an advisor who understands their needs. “Clients want to deal with someone who speaks the language they understand,” says Robinson. Brian Barsness, CIM, director, investment services at Kindred Credit Union (formerly Mennonite Savings and Credit Union) in Kitchener, Ont., agrees that synchronicity between advisor and client is key. “Is the advice you’re giving your clients on Monday morning the same as the advice they got in church on Sunday morning? If not, there’s a disconnect that can be troubling to the relationship.” Of course, that isn’t to say any advisor would limit their services to any one group. In fact, quite the opposite — as SRIs become more popular, even secular investors are turning to financial institutions such as Kindred, which is inspired by Mennonite principles including a commitment to peace, social justice, and mutual aid, because they agree with the ethical approach. “I’m not here to dictate to clients what they should or shouldn’t do,” concurs Brown. “Some of my clients are very observant, some are not observant at all, and others are not Jewish. You always take your cues from the client.” MAY 2019 FORUM 17
ETHICS
in the 2011 census), opportunities for advisors who offer halal financial and investing services is poised to grow as well. A GROWING NICHE Indeed, a 2015 study on Islamic Finance in There are now 65 professionals in Canada with Canada by the Toronto Financial Services the Certified Kingdom Advisor (CKA) designaAlliance and Thomson Reuters projected a tion, up from just 14 when Robinson joined the 132-per-cent increase in Canadian Islamic organization four years ago. “There is clearly a mutual fund assets between 2014 and 2020, to US$557 million from US$240 million. The need for advisors all across the country who report went on to say that an “Islamic fund understand this market,” he says. universe in Canada that attracts non-Muslims Some of those CKAs work at Kindred, which Khaled Sultan could be even larger, at US$2.04 billion accordis itself an example of growth in the faith-based ing to our estimates.” niche market. The financial institution saw net membership growth increase by 25 per cent and deposits grow by Even robo-advisors are entering this niche market; in 2017, $78.5 million in 2018, for total net assets of $1.2 billion. Although Wealthsimple became the first robo-advisor to launch a halal portKindred no longer tracks a client’s church or faith affiliation, it folio for Canadians. estimates that around 70 per cent of the credit union’s members And, of course, there’s the faith-based crossover with the larger SRI market, which now represents more than half (50.6 per cent) have a Mennonite background. of the country’s investment industry, up from 37.8 per cent just Given that the Muslim population in Canada is expected to two years ago, according to a 2018 report from the Responsible reach 2.7 million by 2030, or 6.6 per cent of the country’s projected total population (more than double the 3.2 per cent recorded Investment Association of Canada.
BEST PRACTICES FOR
FAITH-BASED ADVISORS
A
dvisors who offer faith-based services often walk a fine line. On the one hand, they hope to help clients align their financial lives with their religious beliefs. But on the other, they don’t want to alienate anyone or impose their personal views on others. Here are a few tips to navigate this tricky territory.
Take the Client’s Lead An advisor’s main role is to serve their clients. So, it makes sense not to broach the topic of faith unless they do so first. “I was very intentional in not putting my faith forward,” says Lorne Robinson, CFP, who started his career in full time ministry as a pastor before working as a financial advisor for 24 years in Newfoundland and Labrador. “Unless clients opened the door and initiated a conversation about faith, it was not something I pursued with them.” Having said that, clients are more likely to bring up the topic if you stay approachable, says Sucheta Rajagopal,
18 FORUM MAY 2019
CIM, FCSI, CFP, a portfolio manager with Mackie Research Capital Corp. in Toronto, who specializes in SRIs. “If you are open and non-judgmental, in my experience clients will open up and tell you those personal moral stories that they might be embarrassed to tell others,” she says.
Consider Specialty Designations Having a recognized designation, such as Responsible Investment Specialist (RIS) or Certified Kingdom Advisor (CKA), can be a signal to current and potential clients that you have a deeper understanding of ethical or faith-based financial concerns. “All our advisors have the RIS designation; many are CKAs as well,” says Brian Barsness, CIM, director of investment services at Kindred Credit Union in Kitchener, Ont. “The advisor gets the benefit of having their profile put up on Kingdom Advisor’s website, and the clients get the assurance that there is training and legitimacy in what that advisor can do for them.”
Walk the Talk Of course, no additional certification is necessary to provide faith-based services. David Wm. Brown, CLU, CHS, TEP,
partner at Al G. Brown & Associates in Toronto, for example, can help his clients adhere to the rabbinic laws outlined in the Talmud because he is a lifelong practising Orthodox Jew. “If you want to get into this niche, the relationship your clients have to God has to be your relationship as well,” he says. Advisors who walk the talk often end up indicating to clients that they are faith friendly through their actions. “Some of our Jewish clients will not do business with those who are not shomer Shabbos [literally, keepers of the Sabbath],” says Brown. “So, when they see that we are closed on Saturdays and all the Jewish holidays, they are more comfortable dealing with us.”
Go for Niche Marketing If you’ve done all of the above and still aren’t having much luck finding the right clientele, consider niche-marketing opportunities, such as classifieds in faith-related publications or websites. For instance, a number of advisors who specialize in sharia-compliant and halal investing advertise on the Canadian online hub MuslimLink.ca, including those at large firms such as CIBC Wood Gundy, Investors Group, and RBC Wealth Management. — T.S.
Brian Barsness
David Wm. Brown
Lorne Robinson
Sucheta Rajagopal
Sucheta Rajagopal, CIM, FCSI, CFP, a portfolio manager with Mackie Research Capital Corp. in Toronto who specializes in SRIs, says many of her clients open up to her about their faith and how it shapes their investment preferences. “SRI itself is about values, so I’m used to having conversations about morals with my clients,” she says. “If what they think is right or wrong comes from a faithbased perspective, they’ll tell me right away.” For example, some of her Christian clients are concerned about climate change and want fossil fuel–free portfolios, which gets back to the concept of the steward looking after the Earth. Others may be interested in impact investments, so they can support specific faith-based initiatives. Still others may be spiritual, but not affiliated with any religious group, and are concerned with inequality or poor working conditions. That can mean avoiding investments from countries with bad labour practices, or choosing to support companies in those countries that are trying to foster change. Rajagopal herself was born a Hindu and is now a Buddhist. “We all want to make the world a better place, so we come together on that,” she says.
WHAT ABOUT ROI? “That’s always been the question from day one — can you get good returns and be true to your beliefs,” says Barsness, who previously worked for Meritas, the first faith-inspired mutual fund company in Canada. “The answer is 100 per cent yes. Numerous studies have shown that you don’t have to give up performance to align your investments with your values.” A 2015 report by Carleton University’s Centre for Community Innovation, for example, found that Canadian SRI fixed income and balanced funds financially outperform the benchmark 67 per cent of the time, with risk characteristics in line with other Canadian mutual funds in these asset classes. And a 2015 meta study by the Morgan Stanley Institute for Sustainable Investing, which reviewed seven years of performance data for 10,228 open-
end U.S. mutual funds, found that sustainable funds tend to have slightly higher returns and lower volatility than their traditional counterparts. Nevertheless, the perception persists that values-based investments are somehow inferior. “I call it the zombie myth, because it’s the myth that won’t die,” says Rajagopal. The irony, however, is that many faith-based investors don’t care if they earn slightly less by staying true to their values. “About a third of my clients will tell me they don’t mind if they have to sacrifice returns, because they can’t sleep at night in good conscience if they’re making money from products that kill people or companies that use child labour,” says Rajagopal. “Then I tell them, the good news is, you don’t have to sacrifice anything.” That sentiment rings true for Scott Albrecht, 42, a bookkeeper and long-time member of Kindred Credit Union. As a lifelong Mennonite, he’s a staunch pacifist who grew up alongside wartime conscientious objectors, and spent 12 months over a four-year period in his 20s volunteering on Christian peacekeeping missions in Colombia. “I chose Kindred because it was a Mennonite institution. I like that they screen out investments for military and weapons — which is a big issue for me,” says Albrecht, who admits he’s never even considered traditional investments. “My investments have performed quite well. I haven’t compared them to other ones, so I don’t know if they’re better or worse, but I’m not losing any sleep over it.”
CHARITABLE GIVING Another aspect of faith-based financial advice that cannot be underestimated is clients’ deep desire to give back, as was the case for the Greeleys. Jews, for instance, believe in giving 10 per cent of their annual income to tzedakah (charity), on an annual basis. “Tzedakah is integral to our system,” says Brown. “For that reason, investments are important — if you make the right investments, you will earn funds that you can circulate back and give in the form of tzedakah.” According to a 2018 poll conducted by Kindred Credit Union, 70 per cent of its members currently incorporate charitable giving into their financial plans. Furthermore, members who feel it is very important that their financial institution offer SRIs were also more likely to volunteer, and to donate to a charity within the previous month. “Charitable giving is high right across the board with all SRI clients,” says Rajagopal, adding that her clients tend to make aboveaverage donations on an annual basis, as well as volunteer. “I have a client who retired from the Royal Bank and became a volunteer with Doctors Without Borders. It took up 100 per cent of her time — it was almost like another job.” And that, too, is a concept for faith-based advisors to keep in mind, says Robinson. “I have developed a personal conviction that work is meant for an entire lifetime, which provides a very different perspective on retirement than most have. In one sense, I retired from my financial planning career serving clients, but in fact I really retired to my current role so I have maintained a purpose,” he says. “People shouldn’t retire from something, but retire to something.” TAMAR SATOV is a Toronto-based editor and writer. To receive a PDF of this article, email dgageforum@gmail.com. MAY 2019 FORUM 19
CLU DESIGNATES
John A. Tory
AWARD 2018 THE INSTITUTE CONGRATULATES 2018 JOHN A. TORY AWARD WINNER
VAUGHN HOSKINS CLU®, CPA, CA FOR ATTAINING THE TOP MARK IN CANADA.
ALBERTA
Seongho Park, CFP, CLU Bonny Stedman, CLU Anthony S. Tadros, CFP, CLU Coleen Joan Taylor, CFP, CLU, CHS Barry Michael Stephen Trischuk, CFP, CLU, CHS Alexandra Marguerite Catherine Valdal, CFP, CLU, CHS Gilbert William Van der Woerd, CFP, CLU Pai Chuan Evan Wang, CLU Judy Yi Rong Zhu, CLU
MANITOBA Francine Allousie Diogo, CFP, CLU Jolene R. Hall, CFP, CLU, CHS Angela L. LeBrun, CFP, CLU
Craig Anheliger, CFP, CLU Brandon Bailey, CLU Randal D. Denton, CLU Lorna V. Fernandez, CLU Nathan Giesbrecht, CFP, CLU Cameron Ross Graham, CLU, CHS Melissa Granger, CLU Patrick R. Hanna, CFP, CLU Taylor Koester, CLU Jonathon Luimes, CFP, CLU Robert D. Mailer, CFP, CLU Lloyd R. Mitchell, CFP, CLU, CHS Charles Jun Park, CPA, CMA, CLU Mitchell Reynolds, CFP, CLU, MBA Jessica Theroux, CLU Christopher Thiessen, CFP, CLU Henry B. Tian, CFP, CLU
NEW BRUNSWICK John C. Maisey, CLU, CHS
NEWFOUNDLAND Vaughn Hoskins, CLU, CPA,CA
ONTARIO
Edison Yufeng Wen, CLU
BRITISH COLUMBIA Michael Araujo, CLU Manuel Del Dago Fernandez, CFP, CLU Bryan Ference, CLU, CHS Mehul Gandhi, CFP, CLU Victoria Gerson Gubbe, CFP, CLU Brian KJ Girard, CLU Christopher Lee Gorman, CLU, CHS Jesse Martyn, CFP, CLU Namir Mustafa, CFP, CLU Jeffrey M.P. Nason, CFP, CLU, CHS Jim Chun Ying Pan, CFP, CLU
Melanie P. Adams, CLU Taha Al-Dabagh, CFP, CLU, CHS Maria Concepcion Alcon, CLU, CHS Damian Alexander, CLU Zeeshan Ali, CLU Thomas Allen, CFP, CLU Luciano Aquino, CLU, CHS Christopher R. Arthur, CLU Jennifer Lauren Beasley, CLU, CHS Melba Belo, CFP, CLU, CHS Robert Jason Bird, CLU, CHS Randy Butt, CFP, CLU, CIM, CHS Adam J. Campbell, CLU Camilo Chacon Sandoval, CLU Patrick F. Chambers, CLU Priscilla P. Chan, CLU, CHS Salil Chatrath, CLU, CHS Nilani Chelliah, CLU Shan Chen, CLU Guanfang Chen, CLU, CHS Ryan Bradleigh Chin, CLU Tim Chuang, CLU Lee-Ann Cole-Manley, CFP, CLU, CHS
Scott Cordier, CFP, CLU Roberta Joy Courtemanche, CLU Mark B. Coutts, CFP, CLU, CHS Mark G. Coyle, CFP, CLU Shamali Das, CLU Yun Deng, CLU Manjit Dhir, CFP, CLU, CHS Charlene Davina Dipchan, CLU Ryan Bradleigh Chin, CLU Jie Dong, CLU Gregory Paul Dowdall, CFP, CLU Ashley DSilva, CLU Mike S. Ellis, CFP, CLU Aleksandra Emmerson, CLU Elaine M. Erhart, CLU Nicole Ewing, CLU Jaimie Foncea, CLU, CHS Pinal Gadhvi, CFP, CLU Chenthuran Ganesarajah, CLU Arvind Gangwar, CLU Jeffrey H. Gillmeister, CLU Fitzroy Gilzene, CLU Gianni Gimpoli, CLU Karthiga Gnanachandran, CLU, CHS Andrew S. Gooden, CLU Tao Guo, CLU Shivani Hallan, CLU Brian S. Horton, CFP, CLU, CHS Shufeng Hu, CLU Mr. Wilson Huang, CLU, CHS Xue Huang, CLU Michael Hunter, CLU, CHS Nadeem Ibrahim, CLU Trevor Francis Ireland, CFP, CLU Anne-Marie Isaacson, CLU, CHS Zahra Jahed-Shoar, CLU, CHS Ravinder Singh Jassu, CLU Brijinder Kahai, CLU Yash Khubchandani, CLU, CHS Derek Kohalmi, CLU, CHS Shihao Lai, CLU Lisa D. Lamers, CLU Cherry Ann Regalario Legrand, CLU, CHS Jamie Lepper, CLU Bryan Lew Yew Pha, CLU, CMA, CFP Qingyong Lian, CLU
The Institute for Advanced Financial Education (The Institute) is the leading designation body in Canada for financial services practitioners in the specialty areas of Advanced Estate and Weatlh Transfer, and Living Benefits. The Institute provides a platform of standards and advanced knowledge through designation programs and accreditation services.
You have demonstrated exceptional commitment to both your career and your clients by obtaining the CLU® designation. www.iafe.ca
Yanjun Liu, CLU Michael Logashov, CLU Michael F. Lutes, CFP, CLU Thien Ly, CLU, CHS Laura A. Madsen, CLU, CHS Martin M. Maretzki, CLU, CHS Brett Martinson, CLU Armen Martirosyan, CLU Simon Maxwell, CLU Justin McCarron, CLU, CHS Adam McInroy, CFP, CLU Erin Danielle McManus, CLU Jane McMillan, CLU Cameron H. McTavish, CLU, CHS Jean-Daniel Methot, CLU Uday Mohaya, CFP, CLU Lester R. Nazareth, CLU, CPA Dale I. Niman, CLU, CHS Shane Nixon, CFP, CLU Sarah Oommen, CLU, CHS Eric J. Orr, CLU, CHS Loredana Otrocol-Mahalagiu, CLU Gregory Oue, CFP, CLU Ali Pahlavani, CFP, CLU, CHS, MBA Vijay N. Pandya, CLU Cielito Lindo Kahano Parone, CLU, CHS Svetlana Petlaha, CLU, CHS Frederick John Pratt, CLU Bamathi Ramthas, CLU, CHS Jason Dwight Ransome, CLU, CHS Gnanachandran Rasalingam, CLU, CHS Victor P. Reyes, CLU Tabitha Jean Riccio, CLU, CHS Christopher A. Riddell, CLU, CHS Michele A. Ripley, CFP, CLU Victoria Robertson, CFP, CLU, CHS Kristian Marc James Robillard, CLU Luis Arthur Rosaroso, CLU Daniella Rusyn, CLU, CHS Trevor Salfarlie, CLU Ryan Douglas Saysell, CLU Anita Shah, CLU, CHS Minoo Shahriarizavareh, CFP, CLU Irene Sham, CLU Jake E. Sheehan, CLU
Daniel Sheppard, CLU Ryan Simone, CLU, CHS Amarina Singh, CLU, CHS James Mark Skeggs, CFP, CLU Jacqueline Elaine Smith, CLU Jennifer F. Stoddard, CLU Tatyana Subbotina, CLU, CHS Naz Sukhram, CLU Rick S. Sukhu, CFP, CLU Dennis K.W. Sum, CLU Jinsong Sun, CFP, CLU Brett Volpe, CLU Sandeep Kaur Wadhawan, CLU, CHS Ryan Robert Waszczuk, CFP, CLU Lucas White, CFP, CLU, BBA Vicky K. Williams, CLU, CHS Teresa S M Wong, CLU, CHS Shanshan Wu, CLU, CHS Yun Xie, CLU Chi Xu, CLU Mirna Yogeswaran, CLU, CHS Anthony Yu, CLU, CHS Jin Zhang, CFP, CLU
Weilong Zhi, CLU
PRINCE EDWARD ISLAND James C. Sullivan, CFP, CLU
QUEBEC
Leslie W. Dunstall
AWARD 2018 THE INSTITUTE SPECIALLY RECOGNIZES THE 2018 DUNSTALL PRIZE WINNERS FOR ATTAINING TOP MARKS IN THEIR RESPECTIVE PROVINCES:
ALBERTA
Charles Jun Park, CPA, CMA, CLU
BRITISH COLUMBIA Mehul Gandhi, CFP, CLU
MANITOBA Angela L. LeBrun, CFP, CLU
ONTARIO Nicole Ewing, CLU
PRINCE EDWARD ISLAND James C. Sullivan, CFP, CLU
Debbie A Beaupré-Odorico, CLU, Pl.Fin, TEP Nick Giannone, CLU
SASKATCHEWAN Brandon D. Anholt, CLU Jason D. Aspinall, CFP, CLU Jonathan Matthew Bast, CLU Michael Edward Carey, CFP, CLU Brandon M. Deering, CLU, CHS Devin J. Harris, CFP, CLU Curtis Kimpton, CFP, CLU Clayton Q. Lane, CFP, CLU Kevin A. Monsebroten, CFP, CLU, R.F.P. Dennis J. Nieth, CFP, CLU Jack Wozniak, CFP, CLU, CHS
The Institute for Advanced Financial Education (The Institute), CLU® and CH.F.C.® are trademarks of The Financial Advisors Association of Canada (TFAAC). The Institute is a wholly owned subsidiary of Advocis®. Copyright © 2019 TFAAC. All rights reserved. Unauthorized reproduction of any images or content without permission is prohibited.
PRACTICE MANAGEMENT
Team Growth
All advisors must be a combination of finders, minders, and grinders some of the time. April-Lynn Levitt and Art Schooley explain how to use your strengths to evolve your practice
22 FORUM MAY 2019
W
e worked for a number of years with a highly successful insurance advisor, we will call Fred, who once posed the following question: “What do you think goes through my mind after a client says yes to one of my recommendations?” His answer was the following: “Who’s next?” This is the classic mindset of a finder. Finders are business owners who are always looking for their next prospect and converting the next prospect into a new client. They are what we call natural rainmakers. While Fred was growing his business, he continued to spend much of his time prospecting and finding new clients. Fortunately, he had an inside licensed team member we will call Barb. Barb’s strength was building relationships with clients and ensuring that their clients always came back to Fred when they had new financial needs. Barb understood that selling an existing client was usually easier than finding new clients. Her natural strength of being a minder help Fred maximize all the good prospecting work that he had done over the years by maintaining and building those relationships. A couple of years ago, Fred decided to retire. He sold his business to an advisor who we would describe as a grinder. This advisor, we will call her Tricia, took a planning approach with the clients that she bought from Fred, and rather than looking for quick transactions, went deeper in terms of understanding the clients’ entire financial situation including what they wanted to accomplish. Tricia was able to convert many of the term contracts that were put in place by Fred, and after completing an entire financial plan, she started managing the assets of many of the clients. Her approach was more analytical, and was a longer process than Fred’s was, but yielded larger premiums and assets because of her grinder style. The original concept of the finder, minder, and grinder roles came from David Maister’s 1993 business book classic, Managing the Professional Services Firm. In it, he described these three key roles as they relate to professional services businesses, including accounting, legal, and consulting firms. From our years of coaching financial services professionals, we find these terms are equally relevant in our industry. As in the story above, typically finders like to provide simple solutions that can be quickly implemented so that they can move on to the next opportunity. They enjoy networking, are often motivated by sales contests and campaigns, and may get bored with the follow-up work required with paperwork, completing financial plans, and ongoing service of existing clients. We sometimes find that finders have a naturally fast pace and actually
have a challenge with slowing down. These people will likely have success with traditional methods of prospecting such as cold calling, striking up relationships with people they meet on a daily basis, networking, and socializing with potential clients. Strategies for success for the finders would be to set up systems and processes to build a team around the finder to free up 80 per cent of their time so they can focus on new business development. One advisor we work with has this style, and after going through a client segmentation exercise to reduce the number of client relationships that were not ideal, he found he was bored. We encouraged him to use his new-found extra time to build business development on a higher level with his ideal business-owner clients — spending time with them socializing at events such as hockey games, intimate get-togethers, and going down south on a golf trip with a group of clients. By focusing his efforts on his strengths, and building key relationships, he was able to double the amount of new business to the firm. Finders may also have success bringing in subject-matter specialists to help with the typical grinder work involved in higher-level cases. Minders are great at managing relationships and providing ongoing service to clients. We often see associate advisors hired to take on this role of looking after existing clients. They may have a challenge with competitive selling, and are more effective if they are coached to adapt a relationship selling style. These advisors can still reach top levels, but will take a slower path than the finder will. They often need to work on speeding up their pace and encouraging a sense of urgency within themselves. For example, following up before leads get cold, and with clients, encouraging action and not letting them procrastinate on important decisions. When an advisor with the minder style wants to build their client base, they are often successful in getting introductions from existing clients, as they can capitalize on the deep, trusting relationships they have developed. The key is implementing a comfortable process to use consistently. A growth strategy would involve bringing on someone in a finder role, even if the role simply involves calling clients and prospects, and booking up the minder advisor’s calendar. Grinders are the often called the “worker-bees” of the business. One advisor we would classify as a grinder told me that his favourite part of his job is “digging deep into the numbers to come up with the perfect solution.” They are often analytical, detail-oriented, and enjoy the planning piece for clients. They may have many professional designations. On the downside, prospecting and sales may be a challenge for grinders as they can suffer from “analysis-paralysis,” which is the tendency to spend too much time analyzing and not enough time implementing.
PHOTO: ISTOCKPHOTO
Grinders are the often called the “worker-bees” of the business. Prospecting and sales may be a challenge for grinders as they suffer from “analysis-paralysis.”
MAY 2019 FORUM 23
PRACTICE MANAGEMENT Grinders are often successful at getting introductions to clients from other professionals such as lawyers and accountants, as they are often grinders themselves. They respond well to their level of detailed planning, and have a high level of trust in these advisors. As in the story above, purchasing a block of business is also a great opportunity for grinders to mine the clients for business by doing a deeper level of analysis. These roles have evolved and shifted over the past few years in the financial services industry due to increasing regulation, more demanding consumers, and a trend toward providing comprehensive wealth management and planning. These days, all advisors must be a combination of finders, minders, and grinders some of the time. In particular, all advisors must be finders at the beginning of their careers when they are starting to build a client base from scratch. Another trend we see is that the upcoming generation of financial advisors, who are often joining successful practices of senior advisors in an associate role, are not natural finders. Often, the senior or founding advisor has a very strong finder style, and this can cause a lot of friction between the senior and associate. In this case, roles, development plans, and expectations must be clearly defined on both sides for a successful business transition to occur. The important thing is to first recognize your primary natural
style. If you don’t recognize yourself in any of the descriptions above, you can use assessment tools such as the DISC profile to help you determine this. Alternatively, ask for some feedback from people that you work with. Once you know your style, you can tailor your marketing and growth strategy around your strengths. If you are a minder or grinder who hates networking, don’t do it! Focus on activities you enjoy, and you will be more successful. Finally, join or build a team made up of complementary styles. This can be accomplished by hiring team members — we are seeing more teams with an in-house paraplanner for example. We have a team who hired someone strictly to focus on new business development. This person brings clients into the firm to meet with the advisors who will do the planning and ongoing relationship management. Alternatively, you can build strategic alliances with others through your firm or suppliers to fill in any gaps. Our belief is that there are many paths to success in this business. By leveraging your unique talents with team members with different talents, you can develop a winning practice.
Once you know your style, you can tailor your marketing and growth strategy around your strengths. If you are a minder or grinder who hates networking, don’t do it! Focus on activities you enjoy, and you will be more successful.
APRIL-LYNN LEVITT and ART SCHOOLEY are coaches at The Personal Coach. They provide customized one-on-one business coaching for financial advisors and their teams to drive results and realize confidence, focus, and freedom. To receive a PDF of this article, email dgageforum@gmail.com.
Need to speak with your clients about philanthropy? Speaking with your clients about philanthropy provides a well-rounded planning service that helps to maximize their financial goals and connects their wealth and values to charity. Abundance Canada can help. Our relational approach can assist you in providing your clients with strategic and personalized gifting solutions. Learn more at abundance.ca or call 1.800.772.3257
Generosity changes everything Abundance Canada is a public foundation registered with the Canada Revenue Agency (CRA). Since 1974, we have helped individuals with their charitable giving in their lifetime and estate through our donor-advised model. Charity Registration No: 12925-3308-RR0001.
TAX UPFRONT
BY JAMIE GOLOMBEK
RDSP Changes The federal budget made disability planning more efficient
A
s trusted advisors, most of us are likely well versed in the ins and outs of registered plans. But what about the registered disability savings plan (RDSP)? If you have a client who is living with a disability, or is a parent of a child with a disability, then it behooves you to brush up on the intricacies of the RDSP as it can be an excellent way for families to save, tax-deferred, for the future, as well as potentially collect up to $90,000 in government grants and bonds. Favourable changes to the RDSP announced in the 2019 federal budget mean that should the effects of your client’s disability improve such that they’re no longer eligible to claim the disability tax credit (DTC), the client is no longer obliged to terminate their RDSP and they can potentially keep any government funds contributed to date. Before going through the recent changes, let’s begin with a short RDSP refresher. Launched in 2008, the RDSP is a taxdeferred registered savings plan open to Canadians eligible for the DTC. Up to $200,000 can be invested in the plan, and while contributions are not tax-deductible, all earnings and growth accrue taxdeferred until withdrawn from the plan. The main attraction of the RDSP, however, is the ability to supplement the plan with matching government funds: the Canada Disability Savings Grant (CDSG) and Canada Disability Savings Bond (CDSB), both potentially available for RDSP beneficiaries age 49 and under. CDSGs and CDSBs are based on “family” income, which includes income of the beneficiary’s parents if the RDSP beneficiary is under age 19. Once the beneficiary reaches age 19, it’s the beneficiary’s own family income that is used to determine the amount of government assistance. When family income is below $95,259 in 2019, CDSGs are equal to 300 per cent of the first $500 of annual contributions
and 200 per cent on the next $1,000 for a maximum annual entitlement of $3,500, subject to a lifetime maximum of $70,000. If family income is over that amount, the CDSG is simply 100 per cent on the first $1,000 of annual contributions. Families who have income below $31,120 can also receive a CDSB of $1,000 annually, up to a lifetime maximum of $20,000. The $1,000 CDSB is then phased out gradually as income increases above this amount until it’s fully eliminated once
RDSPs can continue to remain open even if the beneficiary becomes ineligible for the disability tax credit (although contributions will not be permitted). family income reaches $47,630. Note that unlike the CDSG, the CDSB is not a matching amount, meaning that no contributions are required to get up to $1,000 in CDSBs annually, depending on family income. Under the current rules, when the beneficiary of an RDSP ceases to be eligible for the DTC, no further contributions may be made to RDSPs, and no CDSGs or CDSBs can be paid into the plan. In addition, the tax rules generally require that the RDSP be closed by the end of the year following the first full year throughout which the beneficiary is no longer eligible for the DTC. Currently, there is one limited exception: if a medical practitioner certifies that a beneficiary is likely to be eligible for the DTC in the foreseeable future, an election can be made to keep the RDSP open for five years. The RDSP issuer is required to set aside
an amount (known as the “assistance holdback amount”) equal to the CDSGs and CDSBs paid into the RDSP in the preceding 10 years. This requirement ensures that RDSP funds are available to meet potential repayment obligations. When the RDSP is closed, the assistance holdback amount must be repaid to the government, with any remaining assets going to the RDSP beneficiary. In the 2019 federal budget, the government relaxed these rules by announcing that RDSPs can continue to remain open even if the beneficiary becomes ineligible for the DTC (although contributions will not be permitted, and further CDSGs and CDSBs will not be available). For years throughout which the beneficiary is ineligible for the DTC, and that are prior to the year in which the beneficiary turns age 51, the assistance holdback amount rules apply, and any RDSP withdrawals may prompt the repayment of grants and bonds. Once the beneficiary turns 51, however, the assistance holdback amount will be gradually reduced over 10 years, based on the CDSGs and CDSBs paid into the RDSP during a reference period. For example, for the year in which the beneficiary turns 51, the reference period will be the nine-year period immediately prior to the beneficiary becoming ineligible for the DTC. The assistance holdback amount will therefore be equal to the amount of grants and bonds paid into the RDSP in those nine years, less any repayments of those amounts. These new rules will generally apply beginning in 2021 but, as of the budget date, RDSP issuers are no longer required to close an RDSP solely because an RDSP beneficiary is no longer eligible for the DTC. JAMIE GOLOMBEK, CPA, CA, CFP, CLU, TEP, is the managing director, tax and estate planning at CIBC Financial Planning and Advice in Toronto. He can be reached at Jamie.Golombek@cibc.com. MAY 2019 FORUM 25
CHS DESIGNATES
You have demonstrated exceptional commitment to both your career and your clients by obtaining the CHS® designation.
ALBERTA
BRITISH COLUMBIA
ONTARIO
Roxanne Arnal, CFP, CHS Henry John Barendregt, CHS Aaron Darrell Berard, CHS Lydia E Chan-Kruska, CLU, CHS James William Clark, CHS Vaneesa Shay Dawn Cline, CHS Steve L. Emerson, CHS Lillian Fairclough, CHS Jennifer V. Gose, CHS Megan Griffiths, CHS Lukas C. Hayes, CHS Calvin B. Johnson, CFP, CHS John David Kluthe, CHS Tricia A. Lalonde, CHS Patricia P. C. Mark, CHS Dalton L. Ozorio, CHS Paul R. Pinel, CHS Mark Ramme, CHS Greg K. Schierbeck, CHS Suzanne A. Smith-Demers, CFP, CHS Craig R. Strain, CFP, CLU, CHS David James Talbot, CHS Don Yason Tumacder, CHS November Varga, CHS Riley Warnock, CHS Erin Ashley Wiens, CHS Corey Williams, CHS Jeffrey C. H. Wilson, CHS Heather Yeomans, CHS
Theresa Michelle Aucoin, CHS Lindsay Shannon Beal, CHS Alicia M. Cherneski, CHS Karla E. Graff, CHS Ian R. S. Hartmann, CHS Phil Keane, CHS Brittany Larsen, CFP, CHS, FMA Dillon Parker McLellan, CHS Rachel Elizabeth Memory, CHS Juanpaolo Mercado, CHS Landon Orr, CHS Michael L. Reilly, CHS Courtney Smith, CHS Clayton D. Snow, CHS Saskia Vermeulen, CHS Sylvia Yuan Zheng, CHS, CFP
Alexander Anastasopulos, CHS Adam C. Anderson, CHS Luciano Aquino, CLU, CHS Portia M. Arriola, CHS Jennifer Lauren Beasley, CLU, CHS David L. Bruce, CHS Michael Callahan, CFP, CHS Roshan Charles, CHS Karen E. Chisholm, CLU, CHS Angie N. Chiu, CHS Kyung-Jin Chon, CHS Imran Choudhary, CFP, CLU, CHS Chi Kin Chu, CHS Jennifer A. Davies, CFP, CLU, CHS Kristen Genevieve Fazio, CHS Mariano Ferrara, CHS Dana Jane Fridge, FLMI, CHS David W. Gajewski, CHS Bruntha Garoonanedhi, CHS Joseph Guido, CHS Maria Lea Domingo Hernaez, CLU, CHS James G. Hughes, BBA,CFP,CLU,EPC, CHS Michael Hunter, CLU, CHS Michael A. Irwin, CHS Anne-Marie Isaacson, CLU, CHS Sarah Judd, CHS Daniel Nessim Kachani, CHS Mathew M. Keating, CHS, CFP Yash Khubchandani, CLU, CHS Tim Kott, CLU, CHS Aaron Lalande, CHS
MANITOBA Jeffrey L. Caligiuri, CFP, CLU, CHS Jolene R. Hall, CFP, CLU, CHS Melissa N. Mestrovic, CHS Michael A. Walker, CHS
NEWFOUNDLAND Matthew J. White, CHS
NOVA SCOTIA Geoff S. Campbell, CHS Matthew J. Garland, CHS Calen J. Outhouse, CHS
The Institute for Advanced Financial Education (The Institute) is the leading designation body in Canada for financial services practitioners in the specialty areas of Advanced Estate and Weatlh Transfer, and Living Benefits. The Institute provides a platform of standards and advanced knowledge through designation programs and accreditation services.
www.iafe.ca
Marjorie Lee, CHS Cherry Ann Regalario Legrand, CLU, CHS Timothy W. Lew, CHS Suzzanne Y. Lu, CLU, CHS Patrick C.R. MacDonald, CHS Laura A. Madsen, CLU, CHS Karen M. Manuel, CHS Patricia Elizabeth Mason, CHS Janice C. McFarlane, CFP, CLU, CHS Mr. David E. McPhee, CHS Gemma Mendoza, CLU, CHS Katina Michelis, CHS Laura A. Money, CFP, CHS Michael J. Mullin, CLU, CHS Christina Nesrallah, CHS Maria Jula Ornedo, CHS Brad Paproski, CFP, CLU, CHS Harper Price, CHS
Christopher A. Riddell, CLU, CHS Daniel Rinaldi, CLU, CHS Beata Rodzoch, CHS Ma Shirley Ruiz, CLU, CHS Roberto Sabelli, CHS Leticia Osoteo Salarzon, CHS Sonny M Sangemino, CHS Gino Scialdone, CLU, CHS Kusum Sen, CHS Angelo Setten, CHS Ami H. Shah Sandra Shoebridge, CHS Ryan Simone, CLU, CHS Gurmeet Singh, CLU, CFP, CHS Claudette M. Skerritt, CHS Carlos Soares, CLU, CHS Glen A. Steinson, CHS Matthew Stiller, CHS
Charito Suniga-Parone, CHS Michael Andrew Thorpe, CHS Simeona May Ticsay, CHS Anna Tsepelis, CHS Francesco P. Turchi, CHS Stacey L. Westervelt, CHS Colin James Anil Whitehead, CHS Cheryl Ann Williams, CH Jennifer C. Williams, CHS Teresa S. M. Wong, CLU, CHS Autumn R. Wyonch, CHS Anthony Yu, CLU, CHS
SASKATCHEWAN Weston B. Fader, CHS Mr. Nathan Smith, CHS
The Institute CHS
AWARD 2018 SPECIAL CONGRATULATIONS TO
DAVID JAMES TALBOT CHS ON ACHIEVING THE 2018 CHS AWARD FOR THE HIGHEST MARK IN THE ADVOCIS CHS EDUCATION PROGRAM.
The Institute for Advanced Financial Education (The Institute), CLU® and CH.F.C.® are trademarks of The Financial Advisors Association of Canada (TFAAC). The Institute is a wholly owned subsidiary of Advocis®. Copyright © 2019 TFAAC. All rights reserved. Unauthorized reproduction of any images or content without permission is prohibited.
ESTATE DILEMMAS
BY KEVIN WARK
POA Preparation Complex estate documents require professional advice
M
ost people will devote significant energy into the drafting of their will — giving great thought to who should be their executors and guardians of minor children; who will receive treasured personal items or cash bequests; and which family members will share in the estate residue. For those with more complicated estates, these decisions can take months to finalize and are often revisited as personal and financial circumstances change. As part of the will drafting process, the estate lawyer will usually recommend the preparation of powers of attorney (POA) for property and for healthcare. Unfortunately, the client often does not apply the same level of due diligence when it comes to the preparation of a POA. The result is important issues may not be properly addressed, and the attorney may not even be advised of their appointment and what may be expected of them. Let’s highlight some of the planning issues that should be considered before a client executes a POA for property, and the adverse implications of not doing so. But first, we’ll review some basic principles governing POAs for property. A POA is a legal document intended to provide a person (the attorney) with the power to act on behalf of another person (the grantor) in respect of any property that the grantor owns or controls. All provinces now have legislation that allows a POA to continue to be effective upon the mental incapacity of the grantor. This is known as an enduring or continuing power of attorney. Recognize that the actions of the attorney can significantly impact the quality of the grantor’s life while incapacitated, as well as the financial security of family members and beneficiaries under the grantor’s estate. Thus, the decision regarding who will be appointed as attorney is as important as selecting the executor of an estate. In fact, it often makes sense for the 28 FORUM MAY 2019
grantor’s executor to also be appointed as the attorney or a co-attorney. This leads to an important planning detail, particularly where the attorney is not a family member. The grantor should confirm in advance that the person is willing to act and is fully aware of their legal obligations as an attorney. Assuming that person agrees to act, the attorney should then be provided with details on the type of investments and other assets currently owned by the grantor, and the location of relevant information and legal documents relating to that property. The POA should contain guidance and instructions in terms of funding the grantor’s lifestyle needs, as well as the making of gifts or loans to family members and/or charitable organizations. These instructions will also serve as a good reference point for others in evaluating whether the attorney is properly discharging his or her duties. Finally, the grantor should recognize that the POA may only take effect, or be acted upon, many years in the future. Provision should therefore be made for the appointment of alternate attorneys, who can step into the role should the primary attorney (for example, the spouse) become incapacitated, predecease the grantor, or choose not to act. The appointment of an attorney should also be reviewed on a regular basis to confirm that the designated person remains ready, willing, and able to act.
TO ACCEPT OR NOT ACCEPT POA In determining whether to accept the role of attorney, some important matters need to be considered, particularly where the attorney is not a family member: • The attorney may need to protect the grantor against his or her own actions by having the grantor declared mentally incapable. The attorney must be prepared to take on this task, knowing that it may be
emotionally difficult and result in irreparable damage to their relationship. • The attorney needs to understand that he or she will be held to a very high standard of care while administering any property on behalf of the grantor. Family members might take legal action if they believe the attorney is in breach of his or her obligations. • An attorney should recognize they may be required to take on this role for many years, particularly if the grantor experiences an early onset of Alzheimer’s or dementia. • While an attorney is entitled to compensation for their time and effort, such compensation is often subject to court approval that requires a full accounting of their administration of the grantor’s property. This can be a long and drawn-out process. The issues involved with naming a POA can be very complex, so consult with professional advisors before finalizing these arrangements. KEVIN WARK, LLB, CLU, TEP, is the author of The Essential Canadian Guide to Estate Planning (2nd Ed.) and The Essential Canadian Guide to Income Splitting.
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CORPORATE INSURANCE
BY GLENN STEPHENS
Reviewing Agreements How to structure life insurance for shareholders
T
he use of corporate-owned life insurance to fund shareholders’ agreements is a staple of the business market. The benefits of a funded buyout on death are obvious to an insurance advisor. And in most cases a client’s tax and legal advisors will agree that insurance is the best way to protect shareholders and their families in the event that the unexpected occurs. Having said that, agreements are often deficient in how they deal with a funded buyout on death. This creates opportunities for knowledgeable insurance advisors who are comfortable reviewing agreements. The more effort you put into reading and understanding these agreements, the more you will be seen as a resource to clients and to their other professional advisors, who may not necessarily be wellinformed on insurance planning strategies. Let’s consider some key areas to look out for:
STRUCTURE OF THE BUYOUT ON DEATH In most cases, a shareholders’ agreement will provide that, on a shareholder’s death, the shares will either be redeemed by the corporation or purchased by the surviving shareholder(s). There are many potential buyout structures and no single approach that works in all cases. An insurance advisor can assist in the analysis of the agreement by getting answers to the following questions: • Does the agreement refer to the use of life insurance as a funding vehicle? Most agreements will anticipate the use of insurance, but a surprising number provide for an unfunded buyout on death. In that case, there is an opportunity for the insurance advisor to show the clients that, in most
cases, life insurance is the most cost-effective and tax-effective funding alternative. • Does the agreement make reference to the capital dividend account (“CDA”) and how it is to be used in the buyout? This is a fundamental part of the tax planning when corporate-owned life insurance is used as a funding vehicle, and should be specifically addressed in the agreement. • Is the buyout on death mandatory or optional? In most cases, it is recommended that a buyout on death be mandatory, so all parties know exactly what will happen if a shareholder dies. This is especially true where insurance proceeds will be available.
OWNERSHIP OF INSURANCE Most agreements will provide for the corporation, which is typically an operating company (“Opco”), to be the owner and beneficiary of the insurance. While this is common, it is in fact something to be avoided if possible. Having Opco own the insurance increases the likelihood of having to transfer ownership of the policies in the future. For example, it is common for an individual to sell his or her Opco shares at the time of retirement. If the selling shareholder wants to obtain the policy for personal planning needs, the tax cost of transferring the policy can be prohibitive. In cases where Opco shares are owned by an individual’s holding company (“Holdco”), it is often advisable for the Holdco to own the policy on the life of its shareholder, with Opco named as beneficiary for as long as the shareholders’ agreement is in place. If Holdco sells its Opco shares at a later date, it will not be necessary to change ownership of the policy; changing the beneficiary is all that will be needed.
If the corporate structure or other factors require the policies to be owned by Opco, the agreement should usually provide that any shareholder selling shares during their lifetime has the option to purchase the policy on his or her life, perhaps for the greater of the policy’s cash surrender value and one dollar.
SHARE VALUATION In most cases, the price established for shares bought and sold on death should be fair market value, although this can admittedly be difficult to determine in the case of a private corporation. Valuation is a key piece of information for the insurance advisor, since this will help determine the amount of insurance that is required. Agreements will sometimes provide for shareholders to meet annually and agree upon the value of their shares. Typically, it is expected that the yearly updated value will be added to a schedule attached to the agreement. This may make sense in theory, but in practice most shareholders do not have the time or the inclination to perform this function. In other cases, the agreement provides a formula for calculating fair market value. This can provide an objective method of determining value although there is a risk that the formula will not remain current and therefore not provide an accurate measurement when the time comes. In many cases, the preferred route will be having the parties agree on a purchase price when a shareholder dies. In the event the parties are unable to agree, the agreement can provide for the appointment of an independent valuator. Whatever valuation method is used, the agreement should clearly state that the shares’ value will not include any amount in respect of the insurance proceeds that have been paid to the corporation on the shareholder’s death. Insurance is simply a funding vehicle and generally not part of long-term corporate value. GLENN STEPHENS, LLP, TEP, FEA, is the vice-president, planning services at PPI Advisory and can be reached at gstephens@ppi.ca.
MAY 2019 FORUM 29
ANN UA L
J.G. TAYLOR AWARD RECIPIENTS presented by
Gary Rusu CLU®
J.G. TAYLOR AWARD RECIPIENT Gary Rusu joined the life insurance industry in 1968 with no
he incorporated his Rusu Financial Inc. (RFI) practice. As
formal sales experience or university education, working for
Principal of RFI he works with is wife Marjorie the Secretary
Dominion Life in Saskatoon. Inexperience and the travel
Treasurer of the practice. He has been an Advocis member
expenses incurred to serve the markets he was responsible
since joining the industry in 1968, more than 50 years ago.
for almost pushed him out of the business. But an introduction to the Regional Manager at London Life in Saskatoon gave
Gary’s contribution to his community includes coaching
him a second chance. Gary credits London Life with giving
hockey, teaching Sunday School, canvassing for United Way,
him the training to succeed. He strongly believes he would
and serving as Past President and board member of various
not be here 50 years later without the second chance and the
clubs and associations. He remains active in his church and
training they gave him, a young upstart in the life insurance
currently serves as program director of his Rotary Club. Gary
business.
has been Moderator for the Life Underwriters Training Course and President of his LUAC Chapter. He has also moderated
Gary completed his Career Life Underwriters Training Course
CLU classes and served as President of his local Chartered
in September 1970 and obtained the Chartered Life
Underwriters Association chapter.
Underwriters (CLU) Designation in July 1975. In April 2001
With more than 5,000 CLU® and CHS designation holders in good standing. The institute for advanced financial education is the leading designation body in canada for financial services practitioners in the specialty areas of advance estate and wealth transfer, and living benefits. The institute provides a platform of standards and advanced knowledge through designation programs and accreditation services. Institute destinations speak powerfully of a practice that is built on knowledge and a belief in the continuous refinement of that knowledge.
Award recipients have demonstrated excellence among their peers. they have made an impact on the profession and the public they serve; exemplified the Institute’s code of professional conduct; positively affected their communities; participated in the industry, with either the Institute or Advocis; and/or within other financial services professions.
Bob Owens CLU®, CFP®, CH.F.C.® J.G. TAYLOR AWARD RECIPIENT
In 1995 Bob, and his partners, established Owens MacFadyen
Bob is a member of the Financial Advisors Association of
Group. After 20 years with a major financial services firm, their
Canada, the Conference for Advanced Life Underwriting
mission was, and still is, to offer independent, comprehensive
(CALU) and the Investment Industry Association of Canada.
financial management services. With his 42 years of experience, Bob is well recognized for his expertise in the financial issues
He has been active with industry and community
faced by professionals and business owners.
organizations, including Past Chair of CALU, Past Chair of Rothesay Netherwood School, Past President of Riverside
Bob holds a Bachelor of Business Administration from Acadia University. He has been invited to speak at numerous industry functions across Canada and the United States.
Golf and Country Club and Past Chair of National Health Care Coalition and is a Board Member of the Atlantic Institute for Market Studies.
The Institute for Advanced Financial Education (The Institute), CLU® are trademarks of The Financial Advisors Association of Canada (TFAAC). The Institute is a wholly owned Subsidiary of Advocis® Copyright © 2019 TFAA. All rights reserved. Unauthorized reproduction of any images of content without permission is prohibited.
LEADERSHIP & GROWTH
BY DAVID GRAY
plans and identify the initiatives required to meet your objectives. Most important, you must be able to articulate and deliver your strategy to your leadership team and their team members. This is where you will establish the WHY to your business and develop the value proposition to answer the question: “Why should I consider/continue doing business with your company?”
STRATEGY
Accountability must start at the top of the organization and permeate through the leadership team first to hold each other accountable to the strategy. Only then can it be passed down through the organization. This requires discipline and the ability to make tough decisions. It drives results that will come from being accountable to consistent and meaningful execution of the strategy. This is best achieved through the efforts of everyone on the “team” and a well-thought-out business plan. When everyone buys into a committed direction, the leader can influence the performance of the team with the right activities, and the end result will be the expected performance. Leadership is the link between strategy and execution. You will define your own leadership style and it is important to “know thyself.” Good leaders will spend a great deal of their career listening to their leadership team, their whole organization, and their customers. These are the insights that you will need to consider and act on to deliver your strategy. Besides process, strategy, and accountability, there is one more skill that leaders must achieve, and that is the execution of the business plan. If you cannot execute your business plans, utilizing the skills referred to earlier, then you must accept the accountability of the results. It is the job of leadership to achieve the expected results for the business, and this applies to leaders at every level.
A great deal of time, money, and resources are spent developing strategy within any organization. If you “Google” strategy models, you will get more than 200,000 hits on the Internet, so if one is not provided for you, then pick one and stay committed to it. Without strategy, you will not be able to find the direction to set your annual business
DAVID GRAY is a past president of GAMA Canada. His career has been focused on distribution management across major insurance companies in Canada. GAMA International Canada, a conference of Advocis, provides professional development and networking opportunities for leaders in the financial services industry. For more information, visit www.gamacanada.com.
The Power of Execution
Yielding desired results means having a detailed process, strategy, and accountability
A
leader’s role is to get results. They don’t need to produce the required results by themselves, but they need to engage other team members to work toward a common goal. Let’s examine three leadership skills that will inspire and motivate others.
PROCESS ENGAGEMENT By creating a process, a leader will be able to clearly define the actions required by team leaders and members. Most things we need to do in financial services are processdriven, and the more they are learned and executed, the more consistent the outcomes will be. We need process that will change beliefs and behaviours directly linked to the bottom line. We have recruiting, sales, new business, service follow-up, and referred lead processes, etc. Good leaders 32 FORUM MAY 2019
follow the process that is inherent in their corporate or business structure, and do not stray very far from the way it was developed. If leaders do not provide and execute this within the group, then the individuals will make it up as they go along and do what is comfortable within their own skill set. The team can’t be at fault for lack of achievement or follow-through, if there was no defined process to follow.
PHOTO: ISTOCKPHOTO
ACCOUNTABILITY
AdvocisNews ASSOCIATION UPDATES AND EVENTS
REGULATORY AFFAIRS
OSC TASK FORCE ON BURDEN REDUCTION: WE WANT TO HEAR FROM YOU!
T
he Ontario Securities Commission (OSC) established a Burden Reduction task force in November 2018 to identify ways to enhance the competitiveness of Ontario businesses by saving time and money for issuers, registrants, investors, and other market participants. The task force has a mandate to eliminate unnecessary rules and processes, while protecting investors and the integrity of Ontario’s market, with a focus on the following areas: Operational and procedural changes for OSC branches and offices. In particular, the OSC is seeking to identify changes to make day-to-day market participants’ interactions with the OSC easier and less costly, as well as providing greater certainty regarding regulatory requirements and outcomes; forms or filings that can be streamlined or are unnecessary or an unduly burden; and information directed at market participants that the OSC could provide more efficiently. Rule changes, with a focus on identifying OSC rules that are inconsistent with the rules of other jurisdictions and specific requirements that no longer serve a valid purpose. Enhancing and improving the investor experience with the disclosure provided to them (i) before they invest, (ii) as part of ongoing public disclosure and (iii) by registrants, with a focus on the interface between the OSC’s regulatory requirements and investors, modernizing information provided to investors, and other interactions that investors have with issuers or registrants because of regulatory requirements (for example, by promoting plain language). Advocis Legal and Regulatory Affairs staff are engaged in the process; we participated in the task force’s initial roundtable held on March 27. However, the task force’s work is an evolving process. We would like to hear about burden reduction strategies that are of particular interest to you and your clients. Send your thoughts to regulatoryaffairs@advocis.ca.
IN MEMORIAM Ivan Martin Advocis was saddened to learn of the passing of Ivan Martin, CLU, on March 3, 2019 at Sunnybrook Health Sciences Centre in Toronto. Ivan was an Advocis member for 50 years and the owner of Martin Financial Services Ltd. for 30 years. We send our condolences to his friends, family, and colleagues, and to the members of the Durham Region chapter. Robert Carr Advocis was saddened to learn about the passing of Robert Carr. Robert joined the association in 1986 and remained a member for 33 years. We send our condolences to his family and friends. Jerry Olynyk Advocis also sends condolences to the friends, family, and colleagues of Jerry Olynyk of the Greater Vancouver chapter, who passed away in April 2019. Jerry was a proud Advocis member since 1963. Colin Campbell Advocis expresses sympathies to the friends, family, and colleagues of Colin Campbell, who passed away February 19, 2019. An Advocis member since 1975, Colin served twice as president of the Kootenay chapter, moderated LUATC, and was speaker host at Banff School on numerous occasions. He has been treasurer of Advocis Kootenay since 2002. Colin was a strong believer in qualifications for all members of the financial planning world, with membership in Advocis being a very integral part of those qualifications. Happy Retirement! Advocis congratulates John F. Brown, long-standing member of the Toronto chapter, on his retirement. John has been an Advocis member since April 1, 1973.
MAY 2019 FORUM 33
AdvocisNews CHAPTER NEWS
CHAPTERS RAISE MONEY FOR VARIOUS CHARITIES
T
he Advocis Edmonton chapter’s support for AdoptA-Teen started in 2013 with a Christmas luncheon. For five of the last six years, the chapter has raised $66,680. Adopt-A-Teen fills a gap and provides $50 gift cards for teens aged 13 to 17. The cheque presentation for the 2018 event was held Februarly 13, 2019. Advocis Edmonton advocacy chair Kelly Smith presented the cheque in the amount of $23,051.07 to Andrea Peyton, who serves on the board for Adopt-A-Teen. The Edmonton chapter’s support for Sport Central started in 2016 (the board was attracted to the youth-based nature of this particular charity). Sport Central is dedicated to making resources available to assist underprivileged kids in sports across Edmonton, Central, and Northern Alberta. The chapter’s support included golf tournaments in 2017 and 2018, along with the Christmas luncheon in 2016. They have donated $20,970 over those three years. The cheque presentation to Sheldon Oleksyn, who serves as the executive director for Sport Central, was held February 13, 2019, and was for the amount of $5,615. Advocis Toronto celebrated International Women’s Day with featured speakers Elke Rubach and Samara Charters on March 7, 2019. Due to the high demand for this breakfast
LAMP 2019, CANADA REPRESENTED!
G
AMA International hosted its annual LAMP conference from March 17–20 in Grapevine, Texas. The event attracted more than 2,200 attendees from management teams around the world representing more than 24 countries. GAMA Canada was proud to host a Canadian reception as well have three sessions during LAMP lead by Canadian presenters. LAMP is an opportunity for leaders in our industry to demonstrate the importance of personal development. It is the financial services industry’s premier annual meeting, and attracts leaders from across the globe.
Save Future LAMP Dates: March 22–25, 2020: Gaylord Palms, Orlando, Fla. March 14–17, 2021: Caesars Palace, Las Vegas For more information, visit www.gamacanada.com.
34 FORUM MAY 2019
Edmonton chapter advocacy chair Kelly Smith and Andrea Peyton, Adopt-A-Teen; Advocis Toronto International Women's Day event.
event, Advocis Toronto also hosted a live national webcast. During the event, Robbie Fleischacker, CLU, president of Advocis Toronto, presented a cheque for $6,000 to Cystic Fibrosis Canada.
Notice of Annual General Meeting of Members The annual general meeting (“AGM”) of Members of The Financial Advisors Association of Canada carrying on business as Advocis (“the Association”) will be held in such meeting space as may be determined, at the Sheraton Cavalier Hotel, 612 Spadina Crescent East, Saskatoon on Wednesday June 26, 2019 at 3 p.m. local time for the following purposes: • To approve the minutes of the 2018 annual general meeting • To receive the audited financial statements for the financial year ended December 31, 2018 and the auditor’s report • To appoint the auditor for the next fiscal period • To elect directors • Any other business The AGM of Members of The Institute will be held in such meeting space as may be determined, at the Sheraton Cavalier Hotel on Wednesday June 26, 2019, immediately following the conclusion of the Advocis AGM for the following purposes: • To approve the minutes of the 2018 annual general meeting • To receive the audited financial statements for the financial year ended December 31, 2018 and the auditor’s report • To appoint the auditor for the next fiscal year • Any other business
FINAL WORD
Bring on Title Protection BY AL JONES
E
ventually, the long days of sowing and the hard work of tending begin to culminate in the reaping of a harvest. Your efforts pay off, and you start to see results and are able to enjoy them. That does not mean the work is done, but it does mean that it has been effective. We are proud to be entering such a time at Advocis. As you know, Advocis has been championing a“professions model” for financial advisors for more than 10 years. We believe that key issues facing our industry can best be solved through raising the professional bar for financial advisors, and have made the case to governments and the public. Doctors, lawyers, and other professionals are all required to adhere to professional regulations that help ensure public trust and professional accountability. But the same standards do not apply to the provision of financial advice. Today, anyone can hold themselves out as a financial advisor, whether they have designations or not, are members of a professional organization or not, are bound by a code of conduct or not, and are subject to disciplinary oversight or not. It has been a cornerstone of our advocacy efforts for a long time to change that, bringing it in line with the public will and the public interest. Higher professional standards give Canadians a well-founded assurance in the competence, integrity, and accountability of financial advisors, benefitting everyone, with the exclusion of the unscrupulous who will no longer be able to abuse the system. With your support, our advocacy efforts are producing significant results. The Ontario government’s budget last month signalled full support for title protection for financial advisors and financial planners. The following statement from the budget clearly shows that the government has been listening to us:
PHOTO: LUIS MORA
In Ontario today, there is no title protection for financial planners and financial advisors. Families risk receiving financial planning and advisory services from individuals who may not be appropriately qualified to help them save for the future. Lack of title protection undermines professionalism and confidence in those offering financial planning and advisory services. To remedy the situation, the government pledged to move forward with title protection legislation. “The government’s
plan responds to longstanding calls from consumers and the financial services industry to take action,” the budget says. “It presents significant opportunity to strengthen professionalism, and improve efficiency and competitiveness of the industry with the potential to create and retain more jobs.” This major announcement of planned title protection legislation in Ontario is a landmark on the path toward the professionalization of financial advice. It is a provincial development that will reverberate nationwide. Other projects are also coming to fruition. For many months, our team has been labouring diligently to bring our association’s public image into the 21st century. The result is a total overhaul of our look and feel, which includes a new logo, new advocacy and outreach materials, and, as the central hub of these and other developments, a sleek, new, modern website. The revamped Advocis website isn’t limited to dressing old content in new clothes. It was specifically designed to make it easier to bring you a regular stream of relevant, informative content. You’ll find the quarterly eFORUM newsletter there, the first edition of which features articles on everything from networking to insurance beneficiaries to the federal budget to the Advocis Financial Advisors Index. The site also hosts the new FORUM blog, where we will post often about industry news and other topics that matter to you. I encourage you to visit the new site and to explore it. It will only get better as the team tweaks it and adds to it. The launch of the new Advocis website truly kicks off a “brand new day” in our history. It is important to celebrate these welcome developments — outcomes of the hard work of all our membership and staff. But it is not the time to rest on our laurels. As Will Rogers once said, “Keep in mind that, even if you’re on the right track, you can still be left behind if you just sit there.” I encourage all of you to get involved with your Provincial Advocacy Committees to help advocate on behalf of the professionalization of financial advice across Canada. Hard work pays off. Let’s continue to work together to ensure that Canadians have access to professional financial advice, using the new digital tools that now stand at your service. AL JONES, CFP, CLU, ICD.D, ACCUD, is chair of Advocis. He can be reached at al.jones@freedom55financial.com.
MAY 2019 FORUM 35
25 years of outstanding performance. Fidelity Small Cap America Fund
$1,292,291 Mar. 31, 2019
2014
Series B PERFORMANCE AS AT MARCH 31, 2019 1 YEAR
3 YEARS
16.3% 9.3%
5 YEARS
10 YEARS
12.3% 19.1%
SINCE INCEPTION APRIL 6, 1994
10.8%
2004
2009
$100,000 Apr. 6, 1994
1999
Ask your Fidelity representative.
Source: Fidelity Investments Canada ULC. Performance shows annual compounded returns as at March 31, 2019 (Series B) net-of-fees, in Canadian dollars. Inception date: April 6, 1994. Chart depicts the growth of $100,000 invested in Fidelity Small Cap America Fund over the period indicated, in Canadian dollars, and is based on compounded monthly total returns. Other series’ performance will vary, largely due to fees and expenses. Read a fund’s prospectus and consult your financial advisor before investing. Mutual funds are not guaranteed; their values change frequently and past performance may not be repeated. Investors will pay management fees and expenses, may pay commissions or trailing commissions and may experience a gain or loss. The indicated rates of return are the historical annual compounded total returns including changes in unit value and the reinvestment of all distributions and do not take into account sales, redemption, distribution, optional charges or income taxes payable by any security holder that would have reduced returns. Fidelity Investments is a registered trademark of Fidelity Investments Canada ULC. 163117-v2019425
