Wealth Maximization

Wealth maximization is very exciting for us as this is where a lot of the tools of excellent financial planning can be used. First, we need to have a financial plan. For us the financial plan is the cornerstone of accumulating wealth, maximizing wealth, protecting wealth and ultimately transferring the wealth.

Many things will be considered as part of the plan to maximize your wealth, such as do you have debt that needs to be reduced? Do you have a budget that you are following? What type of investments should you be using? How can your returns be maximized while risk is lowered? How can you achieve the best after tax returns? Which types of accounts should you be using? How much do you need to save and what rate of return do you need to achieve? What strategies can be used to improve your situation? As life changes for you what then needs to be done to modify your plan so that you stay on track with a good financial plan?

There are many components to maximizing your wealth and it needs to be updated at least once or twice a year.

Debt Reduction Planning:

Debt consolidation

    • Debt consolidation is a strategy to lower the overall cost of interest on debt carried. If credit card debt is high then it may be possible to secure a line of credit at a lower interest rate and use the proceeds from the line of credit to pay down the credit card debt.

Debt management

    • Debt management is about properly handling debt and a strategy to pay down the debt in an efficient manner. Considerations include paying down the higher interest rate debt first. Paying down non-deductible interest before paying off deductible interest depending on the interest rates.
    • Debt management also includes how to use debt to build equity or wealth as in some cases debt can be advantageous on assets that appreciate in value.
    • Strategies exist that can accelerate the paydown of debt thereby saving substantial amounts of interest that instead can be saved and used to accumulate more wealth.


Budgeting is an important part of financial planning as a budget assists in creating awareness of where money is being spent and a way to assess whether where it is being spent is the best use of the money available. Budgeting also assists in setting goals and the attainment of those goals.

Budget Worksheet

A Budget worksheet can be a useful tool in recording the sources of your income and the outflow of expenses, savings and debt payments. Click here for the Government of Canada Budget Planner.

Creating a Financial Plan

A financial plan will assist in documenting where you currently are financially, what things need to be addressed to make your current financial situation stronger and a roadmap for the years ahead to assist in achieving the goals that have been established in the financial plan. Financial plans should address at least the following areas:

  • Retirement or Financial Independence Plan
  • Budgeting and Cashflow Plan
  • Debt Plan
  • Mortgage Plan
  • Investment Plan
  • Fee Plan
  • Pension Plan
  • RESP Plan
  • Real Estate Plan
  • Insurance Plan
  • Tax Plan
  • Estate Plan

A good comprehensive financial plan can be an integral tool in assisting in the building and maximization of wealth as well as protecting the wealth and ultimately the transfer of the wealth. To be effective the financial plan should be reviewed once or twice a year to ensure progress is being made toward the goals and adjustments made to the plan if necessary.

Importance of Saving

The importance of saving is fundamental to the maximization of wealth. Whether one is saving for a down payment to purchase a home, or to start a business or to get an education or for longer term retirement purposes it would be difficult to accumulate wealth without saving. The most important component to accumulating wealth for most people is time. Time will allow for money or the value of assets to compound in value. The earlier one starts to save the better as this will allow for longer periods of time for the accumulated wealth to compound and experience exponential growth.

Use this excellent Investment & Regular Deposit calculator to see how you money could grow over time.

Tax planning

Tax planning allows us to try to minimize the amount of tax we pay legally by using various types of tax avoidance measures such as contributions to an RRSP, or using a Tax Free Savings Account.

The more tax we can avoid paying means that we will have more to invest and save or use for other purposes. It will be easier to maximize ones wealth if the amount of income tax paid is minimized in a legal way.

In addition to using RRSPs and TFSAs there are many other ways to avoid paying taxes, such as splitting income between spouses or family members, creating deductible interest expenses and deferring tax to be paid to future years. A couple of other commonly used tax avoidance strategies are the use of flow-through investments and estate freezes.

Flow-Through Investments

Flow-through investments allow investors to access exploration expense deductions that cannot be used by certain resource companies and are legally allowed to be flowed through to investors by these companies through the purchase of certain types of shares referred to as flow-through shares. For more information on how flow-through shares work please refer to the attached booklet

Flow Throughs 2019

Estate Freezes

Estate freezes are a way to potentially defer the taxes related to the ownership of a qualifying small businesses. An individual who owns shares in a qualifying small business corporation may be able to claim an $800,000 lifetime capital gains exemption (LCGE) when those shares are sold. By using an estate freeze it may be possible for parents who are close to or have exceeded their LCGE to have their children access some of their LCGE by becoming owners of shares of the business through a family trust. Careful consideration to the timing and structure of estate freezes need to be made and consultation with estate freeze experts is recommended.

Health and Welfare Trusts

  • Health and Welfare Trusts (H&WT) when structured properly can allow medical and dental expenses to effectively be deducted for tax purposes against a small business owners corporate income.
  • These trusts can also be used to top up traditional group benefit plans to allow for any medical and dental expenses not covered by the group plan to also be expensed through the H&WT
  • A small administrative fee is levied by the trust administrator to adjudicate the medical and dental claims to ensure they are allowable by CRA.
  • It is important to use an administrator who is able to structure the pan properly and does a diligent job in adjudicating claims.
  • Contact a Planwell advisor for more information on the H&WT available through us.


Investments are a key component to the maximization of wealth and can take many forms. The key is having an investment plan which will clarify which investments are most suitable for your situation and appropriate for your risk tolerance level and will assist in attaining your wealth goals.

Maximizing wealth through investments will also require considering how to obtain the best after-tax returns and the best net returns after fees.

The Planwell Net Return Portfolios

  • The Planwell Net Return Portfolios have been designed to deliver better returns over the long-term with less volatility. Each of the eight portfolios have also been designed with a focus on obtaining the best net return after fees. The Planwell portfolios have been designed incorporating pension style components into them such as alternative investments and real estate and infrastructure holdings. The alternative investment allocation provide exposure to important diversifying investments normally missed in traditional portfolios. These alternative investments tend to provide lower correlated returns to the traditional markets resulting in a smoother performance for the overall portfolio.
  • One of the keys to the Planwell portfolios is the repeatable and defendable construction process which prevents subjective factors from entering into the selection process. Each component of the portfolios exists for a reason and is constantly monitored to ensure only the best components are being used.

Mutual funds

  • Mutual funds or professionally managed investment funds have proven to be one of the best and easiest ways to access the best active management. When one does not need active management then a passive ETF may be more appropriate if the return on a net return basis is projected to be better.
  • At Planwell we seek out managers with proven long-term track records of beating their respective benchmarks with lower volatility. We incorporate these investments into our Planwell Net Return Portfolios to assist in the long-term maximization of wealth.
  • Meet some of the managers we use in the articles below:

Meet David Fingold




  • Stocks or the ownership of shares of a company have proven over time to be a very successful way of maximizing wealth. Of course, the trick is knowing which shares to buy and sell and when to do this. Our experience is that as the sophistication of professionally managed money increases it is more and more difficult for an individual or broker to compete with professional managed money. Therefore, our preference is to hold stocks through the equity components of the professionally managed investment funds we hold.
  • Clients can hold stocks within our accounts subject to certain fees.


  • ETFs or Exchange Traded Funds have become quite popular over the last decade as they offer the opportunity to purchase investments with a lower MER (Management Expense Ratio) than a mutual fund. It can certainly make sense to use an ETF when one is looking for exposure to a passive area of the market or a low cost way to hold the investment.
  • ETFs are included in the Planwell Net Return Fee-Based portfolios as this does allow the product cost to be less on these investments.



  • Bonds traditionally have been used to reduce the overall volatility of portfolio by diversifying against the equity or stock components in a portfolio.
  • After almost 40 years of generally declining interest rates since the high interest rates in the 80’s bonds are a trickier investment today as they don’t offer the same degree of diversification as they have in the past.
  • Bonds are also trickier investment today given the current interest rate environment and one has to be careful about chasing higher yields with lower credit quality.
  • Fortunately, there are some alternative investments that also offer compelling yields which have taken away some of the need for the allocations to bonds.
  • One also needs to watch with bonds with low yields what is the net return after fees.
  • Bonds are no longer an easy investment and require careful evaluation in order to contribute effectively to the maximization of wealth.


  • Guaranteed Investment Certificates or GICs offer fixed interest rates for set periods of time. GICs can also come with guarantees covering the principal and interest to certain levels depending on the length of the term and the institution issuing the GIC. Check out the Canadian Deposit Insurance Corporation for more information. For information on the guarantees provided by credit unions check out the Credit Union Deposit Insurance Corporation.
  • At Planwell we have access to over 40 Canadian institutions that offer GICs which allows us to obtain very high rates every day for our clients. For more information about our rates contact us for a quote or check out our GIC rate page.


. Private Investments/Alternative Investments

  • If we look at some of the large pension funds and endowment funds it can be easily seen how prevalent the use of private equity and alternative investments has become. Gone are the days of pensions simply having around 60% in public equities and 40% in fixed income.
  • The Canada Pension fund as of March 31, 2019 was valued at $392 Billion and had 23.7% in Private Equities and 12.1% in Real Estate. The Ontario Pension Plan with $191 Billion as of Dec 31, 2018 had 26% in Real Assets which include Real Estate, Infrastructure and Real Rate Products, as well as 7% in Absolute Return Investments. The Harvard Endowment fund with $39.2 Billion as of June 30, 2018 had 16% in Private Equity, 21% in Hedge Funds and 13% in Real Estate.
  • Unfortunately, the majority of most balanced funds or funds of funds do not include much of an allocation to private and alternative investments.
  • Including private investments and alternative investments assists in diversifying the portfolio and having investments that are less correlated to the traditional public equity and fixed income markets, resulting in a portfolio typically offering a smoother performance profile.
  • Each Planwell Net Return Portfolio (excluding the Laddered Portfolios) holds a combination of Private Investments and Alternative Investments to contribute to a better diversified portfolio offering above average returns with less volatility.

Analyst Coverage Antrim Balanced Mortgage Fund

Antrim Investor Information Series A



Flow Through Investments

  • Flow-through investments allow investors to access exploration expense deductions that cannot be used by certain resource companies and are legally allowed to be flowed through to investors by these companies through the purchase of certain types of shares referred to as flow-through shares. For more information on how flow-through shares work please refer to the attached booklet.

Flow Throughs 2019

Segregated funds

  • Segregated funds can be beneficial in the right situation. The major attraction of segregated funds which are provided though an insurance contract is the principal guarantee that are offered normally between 75% to 100%. Also, under the right circumstances segregated funds can offer creditor protection. They can also assist in bypassing probate due to being under an insurance contract offering the ability to name beneficiaries.
  • One should be careful in selecting the duration of the maturity guarantee periods as they can range from as little as 10 years from the initial deposit date to as much as when the annuitant turns 105 years old. Longer maturity guarantee periods may not be very worthwhile as historically the risk of losing money in the markets over very long periods of time is minimal.
  • Also, one should consider the additional cost of the guarantees. Typically, the extra cost for the guarantees over and above the normal MER of the fund management will be .50% to 1.0%. Over long periods of time this can add up to a significant amount of money especially if one considers having left this money in the account to earn compound returns.
  • We recommend that for those that would only participate in equity investments due to the guarantees that it may be worth it or for those that are small business owners needing the potential creditor protection. Also, for those seniors looking to bypass probate as part of the estate plan.
  • So, for those that need the additional features of segregated funds and are willing to pay a premium for them we then suggest allowing us to show you the best segregated funds that still offer the best net return potential.  There are a wide variety of segregated funds ranging from equity to fixed income and daily interest.


  • Annuities offer the security of knowing how much will be received for a certain amount of time, i.e. 10 years, 20 years or life. Pensions are essentially annuities.
  • The upside of an annuity is the certainty of receiving a predetermined amount for a certain period, however this also means giving up control of the money that is being paid as the premium to an insurance company. Some annuities will provide a payment for a certain period but at death regardless of how much has been paid no more will be paid by the insurance company. Some annuities will provide a payment for a minimum number of years regardless of whether death occurs prior to the end of the minimum period. Annuities can also be structured to be indexed for inflation and also to pay out to a joint survivor if selected at the outset.
  • Low interest rates for the last decade or so have impacted annuities as the lower the interest rates the lower the payments.
  • One should carefully consider whether there are alternative options that may produce a similar level of income prior to committing to this type of investment. Where certainty is required and one is prepared to give up access to the funds then they are a possibility.
  • Annuity payments can vary considerably from insurance company to insurance company so it is important to deal with a broker who can obtain the best annuity payment and contract for you, such as a broker from Planwell Financial Services.

Real Estate

  • Real estate is often part of many people’s strategy for building wealth whether through a principle residence, rental real estate or commercial property. Just like with other investment types a plan should be in place for maximizing wealth accumulation through real estate and whether this will be through direct ownership of real estate or participating in non-direct property ownership like mutual funds, private equity offerings, limited partnerships or other methods.
  • Maximizing wealth through real estate can also include how to build up the equity in real estate more quickly through strategies to pay down any associated debt faster and more efficiently.

Insurance strategies:

Estate Bond

  • The estate bond strategy can be used for those that are insurable and have extra investments that they would like to maximize their value as part of an estate transfer. Essentially the estate bond strategy can include purchasing an annuity to create a guaranteed and care free stream of tax efficient income for life and purchasing a permanent insurance plan which is funded by the annual annuity payments. If structured properly this strategy can lead to greatly enhanced after-tax benefits to beneficiaries compared to simply having money invested in taxable accounts. This type of strategy can be used with a portion of one’s wealth to maximize the accumulation of wealth to pass on to those you care about.

Retirement Planning:

Under the Wealth Accumulation section we discussed the importance of having a plan for financial independence as part of the overall financial plan. For those that have reached financial independence or retirement part of the focus then changes to maximizing the income during this period which can include ensuring the best after-tax flow of income from the various investment account types (RRSP, RIF, TFSA, Open and Corporate) and other investments such as real estate holdings but also maximizing some of the other sources of potential income such as company pensions, government pensions and other government programs available.


  • Private pensions account for one of the largest sources of wealth in Canada. Understanding your pension or your spouses’ pension is important as you consider the various options related to the pension to maximize your benefit from the pension.
  • Decisions will need to be made as to when to start the pension, whether to take a single life or joint pension, and whether to have the payments paid for a guaranteed minimum period.
  • When one is looking to change jobs and a pension is involved then decisions also need to be made about whether to retain the pension or consider moving the commuted value into a locked-in RRSP or LIRA. Some people prefer to take control of the value of the funds held within their pension plans instead of effectively converting these funds into an annuity payment upon retirement.
  • Having a qualified financial planner assist in the evaluation of these very important decisions is a great way to ensure a better understanding of your options and to assist in maximizing your wealth from these plans.

Old Age Security and CPP

  • Opportunities exist to maximize the value of what is available under both the Old Age Security and Canada Pension Program.
  • In some cases, for those with lower taxable incomes it may be possible to increase the amount eligible under the Guaranteed Income Supplement (GIS) program which is part of the Old Age Security program. For example, having savings in a Tax Free Savings Plan instead of an open taxable account could increase the GIS payments for some people. Similarly restructuring other sources of income to be more tax efficient may also assist in increasing the GIS payments.
  • For those with higher after tax income who are losing some of the Old Age Security payments due to the claw backs at higher income levels, restructuring the tax efficiency of your income may assist in qualifying for higher levels of Old Age Security income.
  • Both the OAS and CPP programs allow for the deferral of when to start taking the income and in certain situations this should be considered in order to maximize the value of these plans. A qualified financial planner can assist with these evaluations. Similarly, the CPP program allows for the income to begin before the age of 65 and in some situations, this may be advantageous for some people. However, this should be evaluated against other options.

Property Tax Deferral

  • In BC the government offers a Property Tax Deferral program for those 55 and older.
  • For many people this program simply allows them to defer the payment of a portion of their property taxes until their home is sold. For those using this program this allows them to have an increased annual cash flow for other things and the accumulated property taxes plus a low rate of interest is owed to the government.
  • Some people use this program also to maximize their wealth by effectively borrowing from the government at very low interest rates and investing this money to earn a higher interest rate allowing them to build extra wealth. According to the government’s website “Under the Regular Program, you’ll be charged simple interest at a rate not greater than 2% below the prime rate of our principal banker”. This can be especially attractive if room in a Tax Free Savings Account exists.

Life Changes:

As the saying goes the only things in life that are certain are death and taxes. Outside of these we know that many things can happen which can affect one’s financial plan. Divorce, new job or job loss and downsizing are just a few examples of changes that might occur. Each of these changes can have a positive or negative effect on the maximization of wealth and the financial plan needs to be adjusted.


  • Like most things the financial impact of a divorce can be made easier with planning. Divorce doesn’t necessarily need to be costly, drawn out or complicated but planning is essential.
  • It is important to get good advice from a qualified financial planner who can assist you with this process and in time establish an updated financial plan for your new situation.
  • Bereavement
  • Losing someone you care about is difficult and often comes with some financial changes and challenges.
  • It is good to have someone assist you through this process of sorting out some of the financial issues that will come up and to get things rearranged. Bank accounts, insurance plans, investment accounts, contributions and withdrawal plans and much more need to be addressed.
  • A qualified financial planner can assist during this difficult period with helping to get things reorganized and properly set up and a plan in place to reflect your new situation.


  • Losing someone you care about is difficult and often comes with some financial changes and challenges.
  • It is good to have someone assist you through this process of sorting out some of the financial issues that will come up and to get things rearranged. Bank accounts, insurance plans, investment accounts, contributions and withdrawal plans and much more need to be addressed.
  • A qualified financial planner can assist during this difficult period with helping to get things reorganized and properly set up and a plan in place to reflect your new situation.

New job or job loss

  • A new job may also come with an increased income which can assist with increasing one’s wealth. On the other hand, sometimes, a new job may mean a pay cut and a job loss can lead to a more difficult financial time.
  • Proper planning around these events is important as there are more tax efficient ways to access income during a job loss if this is needed. When one has an increase in income this can lead to decisions about whether it is better to save more in an RRSP or a TFSA or to pay down more off the mortgage. Consulting a qualified financial planner is a great way to look at each option to see which will be the most advantageous in the long term.


  • Sometimes downsizing to a different home is financially motivated and sometimes it is simply due to not needing as large a home anymore.
  • Along with downsizing will be considerations for possibly investing or paying down a mortgage with any residual left over, or downsizing may require additional funds if the downsized home ends up being more expensive.
  • Discussing your plans about downsizing with a qualified financial planner is a great way to explore the options that exist as the planner may have ideas that you have not considered. Clearly downsizing will be a change that will need to be reflected in an updated financial plan to continue to maximize your wealth

Planning Well
LeadS To
Living Well.

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