Anthony Layton MBA, CIM

Chairman & CEO, Portfolio Manager

Peter Guay MBA, CFA

Portfolio Manager
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Should you wait until 70 to take your CPP/QPP?

Canada’s retirement system is built on three pillars: Personal savings, employer pensions and the pensions we get from the government.

If you’ve been lucky, careful and saved enough, these three sources of income are supposed to see you through a comfortable retirement.

But everyone’s situation is different. We know, for example, that many people don’t save enough for retirement. And many don’t have a company pension.

So, government pensions like the Canada Pension Plan, the Quebec Pension Plan and Old Age Security are very important to a lot of people. And that’s why a debate over the age you should start taking your government pensions is attracting a lot of attention.

Some experts say you should probably wait until you’re 70 years old to take your government pensions. Does that make sense? Let’s look at the pros and cons.

The pros and cons

If you turned 65 today, and we’re entitled to the maximum payout from the CPP or QPP, you would be in line for a monthly pension of $1,114.

You can get your pension as early as 60, but for every year before you turn 65, your pension will be reduced by 7.2%. So, if you take it at 60, the reduction is 36%. At current rates, you would receive a maximum of just $713 dollars.

On the other hand, you receive 8.4% more for every year you wait from 65. So when you turn 70, you would be in line for a pension that is 42% greater than the one you would have got at 65. Your maximum would be $1,582 a month, if we ignore inflation for the five years you waited.

OAS benefits can also be boosted by deferring the starting age to 70 though the increase is “only” 36 per cent.
Despite these incentives, people just can’t wait to get their hands on their pensions. Only 6 per cent of all CPP recipients postpone the start of their payments past the age of 65, and a huge number start at 60.


Well, many people can’t afford to wait. They haven’t saved enough for retirement and they need the money.

What if government pensions disappear?

Others hate the idea of drawing down the money they’ve saved for retirement while they wait to collect their government pensions. Many also ask what if I die early? Or what if government pensions aren’t there when I go to collect mine?

I believe concerns about the long-term viability of our government pensions are valid.

At PWL, we expect investment returns to diminish in the years to come. In fact, we expect them to average just 5% a year versus a historical average of 8.4%. (To learn more about diminishing returns, check out my video Seven Steps to Maximize Your Wealth.)

At the same time, Canada’s population is aging and living longer.

These factors will put more pressure on government pensions. A lot of people add it all up and say: Show me the money!

On the other side of the debate are those who advocate waiting until 70. They point to assurances from the people who monitor the health of the CPP and QPP who insist these plans are sustainable for the long-term.

The advocates also argue that if even you live a modestly long life—and chances are you will—you are going to collect a lot more money by waiting. 

Risk transferred to the government

And it’s guaranteed by the government, unlike the money you will draw down from your savings while you wait to turn 70. So, you’ve reduced your risk of running out of money before you die because of investment losses.

The timing of when you decide to take your government pensions should depend on a lot of factors. How much money you’ve saved. How healthy you are. And what you believe about the viability of government pensions in the years to come.

Once you take your pensions, there’s no going back. So, you should talk it over with your financial advisor. And whatever you decide should be in the context of a comprehensive financial plan. 


By: Anthony Layton | 0 comments

Donations Part 2: Securities and Land

Welcome back to “Do It Together” financial planning. In my last video I talked about the tax advantages of making cash donations. This is the second in a three-part series, and in this one, we’re focusing on the benefits when you donate securities and land.

Most of my clients benefit from giving shares from their portfolios, instead of cash. In some cases, I’ve facilitated land donations as well, for conservation purposes. The tax credits are the same as making a cash donation but when it comes to donating land, it’s a little more complicated. There are good tax benefits when you donate securities and land, just be sure to do it right! You’ll have to watch my YouTube video to find out more, so subscribe and check it out.


By: Peter Guay | 0 comments

What is a multi-family office | PWL Capital

What is a multi-family office?

Your family has many needs across multiple generations. These include investment management, tax and estate planning, charitable giving and much, much more.

As your family becomes wealthier, you probably won’t have the time, expertise or desire to manage it all yourself.
That’s why many families choose to have a dedicated team of professionals manage their wealth in an integrated way.

The richest families set up an office whose sole focus is managing the family’s affairs. The Rockefellers were the first family to set up an office to handle their family’s affairs way back in the 1800s. In recent years, more and more wealthy families have set up offices.

But running a single-family office costs millions of dollars a year and that puts it out of the reach of all but the super-rich. However, there is an alternative known as a multi-family office.

What is a multi-family office? It’s a team of professionals that looks after the affairs of several families.

Families share the costs

This allows the families to share the costs of running the office. And that makes a big difference in how much they have to pay for the services they receive.

Multi-family offices come in many shapes and sizes. But they all should offer complete confidentiality and highly personalized service.

They should also provide you with integrated wealth management. This means the team takes a holistic approach to your family’s affairs. From financial planning to investment management to tax optimization, estate planning, insurance needs and coordination of charitable giving—each part is aligned with the others.
Your team should also coordinate the work of specialized experts such as accountants and lawyers. It should make sure all the administration is taken care of and you’re kept fully informed and consulted as your family’s situation evolves.

This kind of an integrated approach offers many benefits. They include:

  • the convenience of having a one-stop shop where all of your financial affairs are managed under one roof
  • personalized service based on a deep knowledge of your family
  • access to a network of expert advisors
  • reduced costs thanks to resource sharing and economies of scale

Things to watch out for

If you think a multi-family office might be right for your family, there are a few things you should watch out for as you search for a firm.

First and foremost are the fees. You want to make sure you’re paying a reasonable amount of money for the services you receive.

One thing to be careful about is the investment products you are being sold.

Funds and insurance products can have sales commissions and management fees imbedded in them. And there can be other kinds of fees, such as those charged for so-called wrap accounts.

Often, these various fees will be in addition to an overall charge for managing your family’s financial affairs. It can all add up to a heck of a lot of money and eat up all your investment returns. So, buyer beware.

You will also want to make sure the firms you are considering have the experience, resources and expertise to provide the kind of fully integrated wealth management that I talked about.

Your participation is important

Finally, your family will play a critical role in making your family office a success.

You should communicate constantly amongst yourselves to avoid conflicts and ensure a common vision. Then, you can work closely with your team to find an approach that’s right for your family.  

The result will be financial security and peace of mind for many years to come.


By: Anthony Layton | 0 comments

Donations Part 1: Cash

Welcome back to “Do It Together” financial planning. This is the first in a three-part series on donations, focusing at the tax advantages of making donations, specifically cash.

Canadians are very giving, according Statistics Canada, 84% of us give to charity and together we give an average of $9 billion dollars a year. That’s pretty amazing.

In this video, I talk about how to choose a charity that’s right for you, how to vet them to make sure they’re legitimate, the kind of tax credits you’ll receive when you make a donation and I’ll take you through the federal government’s First-Time Donor’s Super Credit. There’s a lot of good information in this video so check it out and subscribe to my YouTube channel to learn more.


By: Peter Guay | 0 comments

The pros and cons of setting up a family foundation

Many Canadians who have done well in life want to share their good fortune. They choose to do this in different ways—by volunteering their time, speaking out in support of a cause and by donating to their favourite charities.

In the case of donations, some wealthier families choose to create a private foundation to organize and focus their charitable activities. In fact, there are over five thousand private foundations in Canada and the number is growing.

But remember: This is a decision that involves a lot more than just money. Running a private foundation requires a commitment of time and energy.

First, let’s look at what a private foundation is.

A private foundation is a corporation or a trust that is a registered charity.  It is controlled by a single donor or a family through a board where a majority of directors are not at arm’s length. This is why these foundations are often referred to as family foundations.

Private foundations are tax exempt and can issue official donation tax receipts. While a foundation must operate exclusively for charitable purposes, it can use its funds to operate its own charitable programs or make donations to other registered charities.

The advantages of setting up a private foundation

Now, why would you want to set up a private foundation? What are the advantages?

As I mentioned earlier, a foundation allows you to focus your giving on a cause you are passionate about. In doing so, the foundation can also take donations from non-family members and conduct fund-raising activities.
 Family members such as your spouse and children can get involved as donors, trustees or directors and even as employees of the foundation.

Another thing that people like about a foundation is they are directly involved in how their money is invested and disbursed. Control over the foundation provides flexibility in the event your charitable objectives change, or new needs arise to which you would like to respond.

A foundation gives you the possibility of creating a lasting legacy, one that will continue supporting a cherished cause after your death. It can be named for you or your family, or you can use a completely unrelated name for it.
And, of course, there are the tax savings. Thanks to charitable donation tax credits, for every dollar you give to a registered charity, you get back around 50 cents—depending on your province of residence and marginal tax rate.

You can claim tax credits on donations up to 75% of your net income in the year the donation is made. And unused portions of your donations can be carried forward for up to five years.

You have the flexibility to make donations to a private foundation at times that best suit your tax and estate-planning objectives. In addition, you can make donations and enjoy the tax benefits without having to immediately select the charity or the program to receive that gift.

The disadvantages

So those are the pros. Now let’s talk about the cons.

One of the biggest disadvantages is the costs involved. First, it costs money to set up a foundation, notably for legal and accounting fees.

Then, there are the ongoing expenses for such things as tax filings, preparation of audited financial statements, issuing of tax receipts and investment management.

Beyond this, there are other administrative headaches involved in ongoing compliance and the day-to-day operations of the foundation.

You also have to be ready to accept a certain lack of privacy. That’s because the Canadian Revenue Agency discloses to the public information about your foundation, including its annual financial statements.
Finally, your children and other family members may not share your passion for the cause you support. They may not want to participate in governance or the administration of your foundation. And they may not want to carry it on after your death.

Look before you leap

Setting up a private foundation is an important decision in the life of your family. You should make sure to look at it from every angle with experienced advisors and be ready to make substantial donations to justify the costs and headaches.

You should also look at the alternatives. One very popular one is a donor-advised fund with a public foundation, such as a community foundation. These funds allow you to enjoy many of the benefits of a private foundation and avoid many of the downsides.

I commend you for wanting to share your good fortune. Just make sure you do it in a way that allows you to maximize your giving and minimize unwanted expense and stress for you and your family.

By: Anthony Layton | 0 comments