Navarro Financial Group

07/16/2024

The last two Federal budgets have included major changes for first-time home buyers, and we're seeing lots of investors who don't understand how to take maximum advantage of the new policies.
So we've put together a video rundown of the optimal strategy, integrating the First Home Savings Account and the changes to the Home Buyers' Plan. Check it out, and drop us a line if you have questions!

Here's an up-to-date strategy for optimizing your first home savings plan.

05/27/2024

Thanks Run for Water for a great event supporting a good cause!

https://raceroster.com/events/2024/81664/2024-run-for-water-5k-10k/pledge/team/7

11/16/2023

TAX-SMART INCOME SOLUTIONS
Downsized your home? Sold a business? Received inheritance? If you have a large lump sum you want to invest and turn into income, you NEED to tax-optimize it. Choosing the right investments drastically decrease your tax obligation, and protect your Old Age Security benefit from clawback.

This is our specialty. Join us Nov 23 at 12pm Pacific to find out how we do this for our clients. No charge, no obligation.
Sign up at navarrofinancial.ca/downsizers

10/23/2023

FREE WEBINAR TOMORROW 12PM PT
For many Canadians, their home is their biggest source of wealth, and downsizing the home often becomes part of their retirement strategy. But after the sale, you’re left with a large lump sum of cash, and you need to turn that lump sum into monthly income, hopefully while incurring as little taxation as possible.
We specialize in this scenario, and we have a particular set of lesser-known investment tools that we employ. Learn more at our FREE INVESTOR WEBINAR with Peter Bowen, Vice-President of Tax and Retirement Research at Fidelity.
Register at navarrofinancial.ca/downsizers
[The posts and information presented here are for information purposes only and do not constitute investment advice. Mutual Funds Offered through Investia Financial Services Inc. See bio for full social media disclaimer.]

10/11/2023

Big thanks to local realtor Leanne De Souza for publishing my article on one of the things we do best!

David Navarro is a Financial Advisor with Navarro Financial Group, offering Mutual Funds through Investia Financial Services Inc. “Can I downsize my home and use the proceeds to fund my retirement?” is a common question for late-career homeowners. This is for good reason: downsi…

09/19/2023

INSURANCE WITHOUT UNDERWRITING
Traditional life insurance applications involve an assessment of your risk level which is called UNDERWRITING. This includes a medical questionnaire, and potentially some tests or consultation with your doctor. If you're identified as higher-risk, you can be RATED (charged a higher premium) or DECLINED.

There's another option.

If you have medical complications, or you need life insurance ASAP and want to skip the underwriting process, Simplified Issue Life Insurance is a good option. There's no medical interview or exam; you just sign a Declaration of Insurability, and you're covered - often within 24 hours.

The tradeoff is that Simplified Issue builds extra risk into the premiums, meaning you pay a bit more; however, there are Simplified Issue products that are still competitively priced, and it's worth it to have coverage when you otherwise wouldn't be able to!

If you or someone you know has had medical complications, send us a DM and we'll set up a consultation at no charge!

05/19/2023

There’s a new way to buy your first home in Canada.
The First Home Savings Account is a new type of account, alongside the RRSP, TFSA, etc.
Its built-in tax advantages make it the best way to save up that first down payment. But you have to make sure you play it right, to maximize its advantages!
Questions? Drop them in the comments.



[The posts and information presented here are for information purposes only and do not constitute investment advice. Mutual Funds Offered through Investia Financial Services Inc. See bio for full social media disclaimer.]

04/24/2023

Yes, life insurance can provide for your dependents and/or pay off your mortgage in the event of your death. But that's only the start.
As part of a sophisticated financial plan, it can be a useful tool for a variety of objectives, including all of the above. That's why you need a well-qualified advisor with who will get to know your whole situation and recommend solutions from a broad toolkit.
Drop us a DM if you have questions.

12/21/2022

On Dec 7, the Bank of Canada increased the overnight interest rate by another 0.50%. Over the course of 2022, that rate has increased dramatically, from 0.25% to 4.25%, and more rate hikes are possible in the coming months as the BoC keeps fighting inflation. So how do we respond?

PAY DOWN DEBT
Lines of credit generally have variable interest rates, so they're getting expensive. Revisit your budget, and pay debt off aggressively.
Credit cards won't be affected, but their interest rates are too high anyways. Never carry credit card debt.
If multiple debts: pay the minimums monthly, and pay down the highest-interest rate debts first. Consolidate into lower-interest loans if possible.

RE-EVALUATE YOUR MORTGAGE
Variable-rate mortgages are directly affected. The recent 0.5% increase will increase your payment $30/mo for every $100k of balance. It may make sense to convert to fixed-rate.
Fixed-rate mortgages are unaffected until they renew. Be prepared for a major rate increase at renewal. If renewing in next 18 months, it may be worth renewing/refinancing early, before rates increase further.
Those applying for new mortgages will be able to qualify for less. It's wise to get a pre-approval now, with a long rate lock, to protect against future rate increases.

CONSIDER NESTO FOR MORTGAGE NEEDS
We recommend nesto, Canada's first digital mortgage finance company. They use advanced technology to screen the whole market in seconds to find the lowest rates.
Advisors are salaried, not commissioned - so their only incentive is to get you the best rate. They will give you a free no-pressure mortgage checkup.
Easiest mortgage experience in Canada.
Lowest-rate guarantee. If you find a lower rate, they'll match it or give you $500.
1% cash back on your mortgage balance.
Get approved now, and your rate is locked in for 150 days. This is the longest rate lock in the market, and gives you maximum protection against the coming BoC rate increases.

Use our link below, or DM us for more info.
https://www.nesto.ca/ia/david-navarro

[The posts and information presented here are for information purposes only and do not constitute investment advice. Mutual Funds Offered through Investia Financial Services Inc. See bio for full social media disclaimer.]

12/01/2022

Most people know they should save for retirement, but often they don't know how exactly those savings will turn to income.
Your retirement income is a combination of government benefits, workplace benefits, and your own personal assets. Here's a quick breakdown of the most common sources:

CANADA PENSION PLAN
- Based on contribution over your years employed in Canada.
- Maximum benefit for 65yo is $1,203.75/mo in Q4 2022.
- Can start as early as 60 (reduced) or as late as 70 (increased).
- Call 1-800-277-9914 for a projection.

OLD AGE SECURITY
- Based on Canadian citizenship/residency.
- Full OAS at 65 is $685.50/mo in Q4 2022.
- Can start as early as 65 or wait (waiting increases monthly amount up until age 70).
- Subject to 15% clawback starting at $81,761 of income.

GUARANTEED INCOME SUPPLEMENT
- For Canadian residents 65+ who receive OAS and have low income (below $20,784 if single; more if married).
- Maximum is $1,023.88/mo in Q4 2022.
- Subject to 50% clawback above income threshold.

WORKPLACE PENSION PLAN
- DEFINED BENEFIT PLAN pays a set amount based on your career. Plan admin will provide projections and options.
- DEFINED CONTRIBUTION PLAN provides an accumulated lump sum of employee contributions + employer contributions + growth. Income is based on size of that lump sum. Often can be transferred out as a lump sum to an RRSP or LIRA (Locked In Retirement Account).

RRSP
- Must be converted into a Registered Retirement Income Fund (RRIF) or annuity by end of the year you turn 71. One-time conversion, can't be undone.
- Annuity is a financial product that provides predictable income for a predetermined period. Eliminates market risk.
- RRIF is a type of account in which to hold investments. Vulnerable to market risk. Minimum annual withdrawal based on age (4% at 65, increasing up to 20% for 95+).
- Income from both Annuity and RRIF is taxable.

TFSA
- No age limit, no minimum withdrawal.
- Withdrawals are not taxable
- Withdrawals do not impact OAS clawback or income-based government benefits.

OTHER REVENUE
- Downsize principal residence
- Rental properties
- Money/assets retained in personal corporation
- Non-registered investment account

To decide when and how to retire, it's wise to add up all the sources of income. Once you've done that, you can start asking real questions, like:
- Does this income match my desired lifestyle and other goals?
- If not, should I work 1-2 more years to increase income, and/or should I downgrade my lifestyle expectations and goals?
- How can I strategically draw income to maximize benefit and minimize tax?
..and you'll have real numbers to work with as you make these decisions.

DM us if you have questions.

[The posts and information presented here are for information purposes only and do not constitute investment advice. Mutual Funds Offered through Investia Financial Services Inc. See bio for full social media disclaimer.]

10/29/2022

The Tax-Free Savings Account (TFSA) was introduced in 2009 to give Canadians access to a registered account that can help them save for the future. Here are 5 reasons they can help you!

1. COMPLEMENT YOUR RRSP. Both RRSP and TFSA are tax-favourable investment vehicles. RRSPs generate a tax deduction for contributions and grow over time in a tax-deferred manner. However, once you start withdrawing, you’ll be taxed on those withdrawals. A TFSA is the opposite: you use after-tax dollars to contribute, so growth and withdrawals are tax free.

2. MATCH CURRENT INCOME WITH THE RIGHT VEHICLE. It makes sense to contribute to a TFSA when your income is lower, and withdraw when your income (and tax bracket) is higher; because all TFSA withdrawals are tax free, the net result will be less tax paid. Conversely, you should withdraw RRSP funds when your income tax rate is lower, usually in retirement. Contributing to BOTH is ideal, but if you can’t, prioritize TFSAs when your income level is lower.

3. REDUCE TAX OBLIGATIONS ON INVESTMENTS. Before the TFSA, most people who contributed the maximum to their RRSP would use non-registered accounts to invest. But any growth achieved in these accounts is taxable, often creating a significant tax hit. The TFSA offers tax-sheltering benefits since growth in your account is never taxable.

4. FUND SHORT-TERM GOALS. TFSAs help build your savings and create a tax-free income stream in retirement. They’re also good when you have shorter-term financial needs (home repairs, buying a vehicle, taking a vacation), and want to use your TFSA to cover those expenses. TFSAs provide flexibility because you can withdraw and re-contribute later, without penalty or tax.

5. KEEP GOVERNMENT BENEFITS INTACT. Some government programs are income-tested, which means increased income reduces benefits. TFSAs allow you to withdraw funds without impacting benefits like Canada Child Tax Benefit, Guaranteed Income Supplement or Old Age Security.

The posts and information here are for information purposes only and do not constitute investment advice. Mutual Funds Offered through Investia Financial Services Inc. See bio for full social media disclaimer.