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  • Mar 22nd, 2017 12:15 am
Jr. Member
Sep 9, 2016
115 posts
37 upvotes
Toronto
One consideration you may want to remember is that, when investing for a long period of time a difference of even 1% in fees may result in a huge difference in the payout in the end because of compound interest.

The other is that is there a particular reason you are leaving the money for your kids. It is generally accepted that when kids are left with large sums there can be some serious negative effects on their life. Notice how bill gates and warren buffet is handling it. Just saying you may want to think about that (i also realize its non on my business and is not the question you asked).

There is one investment most people make with a 25yrs commitment and that is real estate. For the most part (for this kinds of timeline) it has proved very resilient, even despite the 2008 financial crisis.

lastly, you might want to set up a trust. This has several benefits, such as protecting the money from things like lawsuits and fighting for who gets what once you pass. Most people think their kids will get along once they are gone but with large sums things are often different. Also depending on how you structure it, it may help with taxes.

Im my experience, a great CFP is someone who will work with you to come up with a plan and help you successfully execute it. That means protecting you from emotional rather than rational decisions and making changes to the plan as circumstances change.

This kind of planning requires coordination between your lawyer (estate planning), CFP, family members etc to pull off successfully. Its quite the undertaking. Good luck!
Sr. Member
May 12, 2014
828 posts
311 upvotes
Montreal
Xavier88 wrote:
Mar 15th, 2017 8:56 pm
Enough for a few generations to live well. [...] Banks needing bailout money in 2008 was what I was thinking of when I said "safe." [...] will never trust hedgefunds, or that sort.
If it's that much, and in US dollars, the first thing to keep in mind is that you are/will be subject to US inheritance tax laws (both when you receive the money and again when you one day will it to your children if it's still in US funds). You should consult a specialized lawyer to plan around this.

You should also consider long term planning through trusts for many reasons (tax and otherwise), and will again need a different specialized lawyer.

Your investments should be dead simple and you should understand them completely: ie: broad market index ETFs. No hedge funds, options, swaps, futures, etc.

The advantage of big bank private banking is that they will put you in touch with a wide range of qualified professionals. You can get second opinions by setting up meetings with people from the "Big four" accounting firms (Deloitte, KPMG, E & Y, PWC).
[OP]
Newbie
Feb 7, 2017
13 posts
9 upvotes
Mythical09 wrote:
Mar 15th, 2017 11:50 pm
One consideration you may want to remember is that, when investing for a long period of time a difference of even 1% in fees may result in a huge difference in the payout in the end because of compound interest.

The other is that is there a particular reason you are leaving the money for your kids. It is generally accepted that when kids are left with large sums there can be some serious negative effects on their life. Notice how bill gates and warren buffet is handling it. Just saying you may want to think about that (i also realize its non on my business and is not the question you asked).

There is one investment most people make with a 25yrs commitment and that is real estate. For the most part (for this kinds of timeline) it has proved very resilient, even despite the 2008 financial crisis.

lastly, you might want to set up a trust. This has several benefits, such as protecting the money from things like lawsuits and fighting for who gets what once you pass. Most people think their kids will get along once they are gone but with large sums things are often different. Also depending on how you structure it, it may help with taxes.

Im my experience, a great CFP is someone who will work with you to come up with a plan and help you successfully execute it. That means protecting you from emotional rather than rational decisions and making changes to the plan as circumstances change.

This kind of planning requires coordination between your lawyer (estate planning), CFP, family members etc to pull off successfully. Its quite the undertaking. Good luck!
- Will def keep an eye on longterm fees.
- Aware on what huge sums can do to young adults....depends on how you raise them I guess. Buffet and Gates, thought they were leaving most of what they have to charities?
- Planning on buying a lot of real estate on the second sum I'm getting.
- Will look into CFP's and what Trusts are.

Thanks for the advice.
[OP]
Newbie
Feb 7, 2017
13 posts
9 upvotes
FrancisBacon wrote:
Mar 16th, 2017 4:58 am
If it's that much, and in US dollars, the first thing to keep in mind is that you are/will be subject to US inheritance tax laws (both when you receive the money and again when you one day will it to your children if it's still in US funds). You should consult a specialized lawyer to plan around this.

You should also consider long term planning through trusts for many reasons (tax and otherwise), and will again need a different specialized lawyer.

Your investments should be dead simple and you should understand them completely: ie: broad market index ETFs. No hedge funds, options, swaps, futures, etc.

The advantage of big bank private banking is that they will put you in touch with a wide range of qualified professionals. You can get second opinions by setting up meetings with people from the "Big four" accounting firms (Deloitte, KPMG, E & Y, PWC).
- Will have to consult with the American lawyer again, but pretty sure that the inheritance tax is being waved. Concerning my own Will for my kids, thought only American assets like property get taxed....but you're saying US$ accounts in a Canadian bank would be subject to US inheritance tax?
- Looking into how Trusts work,...what I leave to my kids is most important to me.
- Index EFT's, will check those out.

Thanks for the advice.
Deal Addict
Oct 1, 2004
3306 posts
184 upvotes
Toronto
joey003 wrote:
Mar 15th, 2017 8:17 pm
I use private banking with TD, but I do it as I had an opportunity to get the service at a good price, and it's been very convenient. I didn't do it for managing investments and such - though as I'm sure with any bank they'd be more than happy to do that. Though as with all banks, I don't feel like you'd get the most intelligent advice from so called advisors that work at the bank.

Can you share what kind of amount you are inheriting? If you prefer to keep it private that's ok.
what kind of discounts do you get?
Deal Addict
Oct 1, 2004
3306 posts
184 upvotes
Toronto
Mythical09 wrote:
Mar 15th, 2017 11:50 pm
One consideration you may want to remember is that, when investing for a long period of time a difference of even 1% in fees may result in a huge difference in the payout in the end because of compound interest.

The other is that is there a particular reason you are leaving the money for your kids. It is generally accepted that when kids are left with large sums there can be some serious negative effects on their life. Notice how bill gates and warren buffet is handling it. Just saying you may want to think about that (i also realize its non on my business and is not the question you asked).

There is one investment most people make with a 25yrs commitment and that is real estate. For the most part (for this kinds of timeline) it has proved very resilient, even despite the 2008 financial crisis.

lastly, you might want to set up a trust. This has several benefits, such as protecting the money from things like lawsuits and fighting for who gets what once you pass. Most people think their kids will get along once they are gone but with large sums things are often different. Also depending on how you structure it, it may help with taxes.

Im my experience, a great CFP is someone who will work with you to come up with a plan and help you successfully execute it. That means protecting you from emotional rather than rational decisions and making changes to the plan as circumstances change.

This kind of planning requires coordination between your lawyer (estate planning), CFP, family members etc to pull off successfully. Its quite the undertaking. Good luck!
What is the going rate in Ontario for a will and trust? once a trust is setup, changes shouldn't be needed unless a new child is born or divorce correct? Once a trust is deemed, I can put additional funds into it without changing the legal papers?

I will have to find a good local lawyer, but what is a typical trust done for kids vs simple will? Does all trusts have to end when they turn 18? or can it be said to execute when the parents die?
Jr. Member
User avatar
Oct 19, 2016
109 posts
31 upvotes
Toronto
Will is cheap like $400+ .... but if you want a Trust, setting up and running a trust is expensive. Also Trusts are taxed at the top rate. It wont make sense for the average person. Unless you have a very high income or large assets.
greg123 wrote:
Mar 16th, 2017 8:54 am
What is the going rate in Ontario for a will and trust? once a trust is setup, changes shouldn't be needed unless a new child is born or divorce correct? Once a trust is deemed, I can put additional funds into it without changing the legal papers?

I will have to find a good local lawyer, but what is a typical trust done for kids vs simple will? Does all trusts have to end when they turn 18? or can it be said to execute when the parents die?
Deal Addict
User avatar
Apr 21, 2009
2198 posts
250 upvotes
Hamilton
greg123 wrote:
Mar 16th, 2017 8:51 am
what kind of discounts do you get?
I believe the default setup is flat $100/month and access to all products without any other fees (any account types, visas, etc). Along with that access to preferred currency exchange rates (though I've seen tellers override that anyway), and direct access via phone/email to a private banking rep (this I think is the most valuable). They can help do anything via phone/email, and if anything ever needs to be signed in person (applications, renewals, etc), they'll come to you.
Jr. Member
User avatar
Oct 19, 2016
109 posts
31 upvotes
Toronto
Warren Buffett wants people to invest in indexes so he can profit off the average person. I respect the guy, incredibly smart ... but he is a wolf in sheeps clothing.



Mythical09 wrote:
Mar 15th, 2017 7:02 pm
Follow Warren Buffets advice.

1.Invest in Index funds. In the last 10 years index funds have outperformed a select group of hedge funds. Google warren buffet bet.

2. Also avoid the pitfall of most rich people who are accustomed to getting what they want by paying more for it. Paying more for investment advice WILL not guarantee better advice.

If you have the time read, Warren Buffet latest letter (there is a thread in the investment forum). He explains the above points in greater detail.

The fact that private banking was the first thought when you came into this money is proof you are already falling into this psychological trap. Avoid it at all costs and good luck.
Jr. Member
User avatar
Oct 19, 2016
109 posts
31 upvotes
Toronto
What would you say to the people who invested in an index such as the Japense EWJ ? their money has gone nowhere from 2001 to now 2017
ace604 wrote:
Mar 15th, 2017 8:27 pm
Safe from what?

Safe from robbers?
Safe from volatility?
Safe from erosion due to inflation?

If it's not for you, but for your kids, that's a long time horizon. Put it into a Vanguard low-cost index ETF that charges on the order of 0.1-0.3% fees and forget about it for several decades.
Deal Addict
User avatar
Sep 9, 2007
2060 posts
315 upvotes
sounds like OP is inheriting sum well into 7/8 figures

my firm often works with Echelon Wealth Partners to sell new deals...

While it makes sense for what people are saying with low cost index funds & etf or whatever, when you have this much wealth, you can afford to take a small hit for greater growth.

I don't think they are the cheapest firm out there, but they seem to work out well for their investors.

Not sure if they're in NS, but they have presence all over the country including BC in Vancouver & Victoria.
Sr. Member
May 12, 2014
828 posts
311 upvotes
Montreal
Xavier88 wrote:
Mar 16th, 2017 8:14 am
Concerning my own Will for my kids, thought only American assets like property get taxed....but you're saying US$ accounts in a Canadian bank would be subject to US inheritance tax?
I was simplifying, so that you will keep the issue in mind when planning. If you have lots of $US, you will surely not keep it all in cash. You will almost certainly invest in $US bonds, stocks, ETFs, etc. Those are considered US assets, and you (your estate) will at a minimum have to file a US tax return when you die. You may also owe taxes to the US government,.

Xavier88 wrote:
Mar 16th, 2017 8:14 am
Looking into how Trusts work,...what I leave to my kids is most important to me.
By all means, look into it yourself. But you should also consult with at least two different lawyers to get ideas on what can be done. Expect to spend a few hundred dollars on each initial consultation if it's not free. Expect to pay $5,000 to $20,000 for setting up a trust depending on how complicated your situation is.
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User avatar
Aug 8, 2012
7280 posts
2508 upvotes
BC
mrtrump wrote:
Mar 16th, 2017 9:36 am
What would you say to the people who invested in an index such as the Japense EWJ ? their money has gone nowhere from 2001 to now 2017

big.chart.gif
Well I was implying US index since that gives you built-in global diversification since so many of the S&P500 companies are global in nature.

Japan shouldn't be a big part of your portfolio and if you are going to pick Japan, you should pick a broad swath of countries and be globally diversified.

Or just go for the S&P 500.

ps. That 17-yr cherry-picked chart that's "gone nowhere" probably paid a lot of dividends over 17 years, no?
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Newbie
Jan 26, 2014
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Sounds like you're looking for investment management. Someone to tell you how much Google, Bombardier, and Walmart stock to buy, etc.

That's different than private banking. Access to credit, will and estate planning, multinational accounts and of course an ATM card a different colour than anyone else.

That you or most that replied to this thread haven't recognized this distinction - maybe it's worth getting some advice about your inheritance.
[OP]
Newbie
Feb 7, 2017
13 posts
9 upvotes
Oslerscodes wrote:
Mar 17th, 2017 7:22 am
Sounds like you're looking for investment management. Someone to tell you how much Google, Bombardier, and Walmart stock to buy, etc.

That's different than private banking. Access to credit, will and estate planning, multinational accounts and of course an ATM card a different colour than anyone else.

That you or most that replied to this thread haven't recognized this distinction - maybe it's worth getting some advice about your inheritance.
I made it quite clear that I want to leave the majority of this sum tucked away. Investing implies risk, which I'm not interested atm. I'm getting another sum in the near future, ....might think about investing a little at that point, or soon after.
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