Hogenhout & Associates Inc. Investment Planning

Now, more than ever, it is essential to have a comprehensive long-term plan in place to meet your financial goals. This can be a difficult and confusing task. Faced with a myriad of product choices and institutions from which to purchase them, you may be uncertain as to which are the right choices for your particular needs.

At Hogenhout and Associates we have developed a singular approach to financial planning, focusing on the five cornerstones of financial planning:

We invest time and energy in understanding our clients, in structuring an investment portfolio providing new products to meet each client's needs. Providing a high level of service guarantees our clients are satisfied with their relationship with us.

To be wealthy enough to enjoy a comfortable retirement is a dream of every Canadian. A Registered Retirement Savings Plan (RRSP) is one way to turn your dream into reality. A RRSP is a pension plan you fund yourself. Your contributions are tax deductible and all income earned on your contributions compounds tax-free while inside your RRSP. Although, we strongly believe that every Canadian should utilize the benefits of an RRSP within their overall financial plan, we also caution Canadians to not rely solely on an RRSP for your retirement dreams. In other words a RRSP should only be one part of your overall financial plan. Proper financial planning suggests that you investigate the many available RRSP-eligible and non-RRSP eligible products available in the financial marketplace. For example, RRSPs and mutual funds make a wonderful investment combination. Many investors seeking investment diversification have learned the benefits of having mutual funds in their RRSP.

Many investors are not aware of the options available on collapsing their RRSP. Your RRSP proceeds may be used to purchase a Registered Retirement Income Fund, a life annuity*, a fixed term annuity or you may simply take the proceeds in cash. If you choose the cash alternative, the entire amount will be included in your income for that year and taxed at your personal tax rate. The other alternatives will provide a stream of retirement income paid to you at regular intervals and taxed over that period of time.

The concept of investment planning integrates the fundamentals of financial planning with in-depth and detailed tax planning. Managing your investments, along with minimizing your personal and corporate income taxes, is the most crucial aspect of your financial security. Your investment portfolio must be "tax-efficient". It is imperative that the income tax implications of investments and related financial planning are fully understood. Presently the regulatory bodies within the financial industry do not require a strong basis of tax knowledge as a prerequisite to offering financial planning services. This is quite evident when, from time to time, we are asked to independently review people's personal and corporate financial situations. At Hogenhout and Associates you can be assured that our strong tax experience, along with our sound fundamental knowledge of financial planning, provide you with the professional comprehensive investment planning you need.

Managing your investment portfolio is often the most crucial aspect of your financial security; it must be monitored and maintained on an ongoing basis. Your investment portfolio must be working towards your financial planning goals. Your investment portfolio must be managed to maximize returns over the long-term as well as optimize tax-efficiency. You know this is a serious responsibility but keeping up with the constant flow of paperwork, new information, new products and constant tax changes is something many people find difficult to manage. That is why professional investment management is so important to your confidence and peace of mind.

You may not realize the many advantages of trusts as instruments in tax, estate and financial planning. There is surprisingly little information readily available to explain what trusts are, how they work and how they can be used. This is surprising because the uses of trusts, in the hands of someone familiar with them, are endless. When creating a trust it is important to bear in mind that the relevant legislation is complex and there are many pitfalls for the unwary. In some cases the use of a trust simply would not be advisable. Professional advice is essential.

In plain English, a trust arises when a person (known as a settlor) transfers legal title for a property to another person (known as the trustee) with instructions as to how the property is to be used for the benefit of named persons (known as beneficiaries). While there are many different uses of trusts, there are two main categories: living trusts (known as inter vivos trusts) and testamentary trusts (created under the terms of a will and arising as a consequence of an individual's death).

Estate planning and wills are subjects most people prefer to avoid. But proper estate planning is crucial to the orderly dispensation of your assets. Dying without a will risks needless taxation, legal challenges, delays and family strife. There are four principal methods of passing on assets:

Each method of passing on assets has advantages and disadvantages. All four methods should be considered in the formation of your estate plan.

Every tax-assisted investment opportunity promises to save you dollars. But there is more to these investments than simply minimizing the tax you pay. A tax-assisted investment must be a sound long-term investment which meets the standards of the most prudent and cautious investor. It is imperative that a tax-assisted investment meets the standards of Canada Revenue Agency (formerly Revenue Canada). Anyone investing in these types of investments must understand the potential drawbacks to these investments. For example, just because a tax-assisted investment has obtained a tax shelter identification number from Canada Revenue Agency does not mean the investment meets the necessary standards. Tax-assisted investments are for high-income earners, the same people that demand that everything is done to minimizes their tax exposure. Tax-assisted investments can provide significant tax savings as well as provide significant rates of return. However, it is our position that any person investing in these products fully understands the pros and cons. We have the expertise to analyze these investments as well as provide the investor with the necessary understanding. We are committed to developing long-term relationships with our high-income clients who require tax-assisted investments and therefore provide the necessary financial, tax and analytical expertise to assist these people in their choices.