Book Giveaway and Financial Survey

I have been writing about financial and wealth trends for over six years. Today, I provide a link to a survey about how these trends are affecting you personally. I would appreciate it if you would complete this survey. To provide incentive (at least I hope it is incentive since you are reading my blog) I will giveaway five copies of my book Let's Get Blunt About Your Financial Affairs to those who complete the survey. The survey will take you between 3-5 minutes to complete, so it is not time consuming and you will have the opportunity to receive a summary of the survey. I would suggest the survey is most applicable to those in their mid-forties and older.

A discussion of some of these trends and why they are important is provided below by Jonathan Townsend, the National Wealth Advisory Services leader for BDO Canada LLP.

Canadians Feel Financial Strain From Different Directions

By Jonathan Townsend

Recently, the trend of Canadians providing multi-generational financial support has come up as an emerging issue. At a time when many of us should be preparing to retire peacefully, numerous people have signed up for additional financial obligations such as housing, education, and health care—not for themselves—but for their children or parents. This added burden, along with longer life expectancies is putting considerable stress on many Canadians.

In a recent Globe and Mail article, 44% of millennials expect to receive financial assistance from their parents to purchase their first home. Many of them consider home ownership a priority; however due to increased housing prices many cannot fund the purchase independently. Instead, millennials are relying on their parents to make home ownership a reality.

Conversely, the parents of baby boomers are living much longer. Many of them may have not saved enough or are facing unexpected medical conditions which require special care or assistance. Again, many Canadians, especially baby boomers are stepping up to the plate. They are taking care of housing and health care costs for their parents, which have considerable costs. In a recent study by CIBC, it is estimated that these costs average $3,300 per year for a caregiver, and amounts to an estimated cost of over $6 billion to the Canadian economy.

The added financial commitments may not have been part of many Canadians financial planning. The time, energy and money being used to support parents and children is putting a huge strain on funding many of our own retirements. Significant numbers of Canadians are nowhere close to hitting their targeted retirement nest egg because their investment returns have not been what was expected in large part because of the cost of financially caring for their children and/or parents. While research shows it is physically and mentally beneficial to work longer, many people need to work longer, out of financial necessity, to support the family and fund lifestyles and retirement.

For those lucky enough to have cashed in on sky-high real estate prices in some Canadian cities or for those who have received an inheritance, they have decisions to make regarding the net proceeds of downsizing or their inheritance and how much goes to their children or parents.

It’s admirable that many Canadians are taking care of their families’ financial needs but it may come at a cost. BDO Canada is exploring these changes and added expectations that we are facing to see how it is impacting our retirement and financial planning. We invite you to participate in this national survey, which will form a report outlining the key insights we uncover. Respondents will be entered into a draw to win one of five, Let’s Get Blunt about Your Financial Affairs books, written by Mark Goodfield.

Complete the survey now by clicking this link. Please note the book giveaway link is at the end of the survey and takes you to a different location so that your survey comments remain confidential.

Jonathan Townsend is the National Wealth Advisory Leader at BDO Canada LLP. If you have any questions, please contact him at 519-432-5534 or jtownsend@bdo.ca.

This site provides general information on various tax issues and other matters. The information is not intended to constitute professional advice and may not be appropriate for a specific individual or fact situation. It is written by the author solely in their personal capacity and cannot be attributed to the accounting firm with which they are affiliated. It is not intended to constitute professional advice, and neither the author nor the firm with which the author is associated shall accept any liability in respect of any reliance on the information contained herein. Readers should always consult with their professional advisors in respect of their particular situation.

Why Survey: Are your Employees not your best source of Client Information?

Wow, what a stunning revelation. According to a recent survey by RBC Wealth Management, the top three concerns of high net worth clients are the transfer of wealth at death, minimization of taxes and financial needs during retirement. Who would have guessed such? How shocking! Could/should RBC's wealth management advisors not have conveyed this message to the wealth management department in the first place?

RBC completed 2,500 surveys during sessions with their high net worth clients and, according to Howard Kabot, vice-president, Financial Planning, RBC Wealth Management Services, they found that their clients “are very concerned about estate planning. What happens to their wealth during retirement and after they are gone are their main priorities… Clients tell us that they want to make sure their families are appropriately taken care of and that their financial plan is as efficient, effective and prudent as possible."

If I was RBC, I would be concerned that my high net worth clients are going to ask themselves the question, "why did I have to tell RBC this, should RBC not already have been aware of my concerns via my advisor?". I have written about most if not all these “estate planning concerns” in my blog during the last year because I know that they cause apprehension to my high net worth clients. I didn’t conduct sessions and surveys, I just listened to my clients concerns during meetings and lunches etc.

This survey reminds me of a variation of this theme. Years ago a friend of mine worked at a company that in its infinite wisdom decided to engage an efficiency consultant. She told me she could tell her employer everything they needed to know about how her company could become more efficient for the cost of a free lunch. The company paid the consultant hundreds of thousands of dollars for advice that was discarded a year later when the organization became dysfunctional. Why companies do not first access the opinions of their human internal resources (employees) in these type situations is somewhat mystifying.

Obviously, I am just picking on RBC to make a point; this could be a survey by CIBC, BMO or Scotia or any other large company. In addition, before you marketing types attack me, I know this survey was probably partly undertaken by RBC to learn about their clients and partly to be released as a study. But why do companies spend money on endless surveys and consultants when their employees should have most if not all the answers?

One would think that RBC should have been able to determine its clients’ top concerns through a session with its own wealth advisors. These findings could then be confirmed with 50 or so clients to make sure the advisors are in sync with their high net worth clients.

My firm is by no means the most progressive in the world, but we constantly request feedback and suggestions from our staff on internal and client matters. We even have outside consultants solicit opinions from our staff in confidence so they won’t withhold their true feelings out of fear of recrimination.

In my opinion, most of these surveys are a waste of time and money and the resources would be better spent talking to your staff on the ground. Assuming your employees are on the ball, you will get most of the information you need from your staff and their interpretations and understandings can be confirmed by a limited survey of your clients. More importantly, if your clients’ opinions do not agree with what your employees expected, you will have identified a huge expectation or communication gap which adds further value to the whole exercise and then you can commission a full fledged survey.

The blogs posted on The Blunt Bean Counter provide information of a general nature. These posts should not be considered specific advice; as each reader's personal financial situation is unique and fact specific. Please contact a professional advisor prior to implementing or acting upon any of the information contained in one of the blogs.