Santa Time!

I always like watching my kids peeping into Santa's house to see if he is there. As usual he is!

I Am The Captain Now!

During our boat tour in Maui, Sarah took the captain's chair and truly embraced the adventure. On the return trip, the winds picked up to gale force, and all the guests had to move inside—except Sarah. She stayed with the captain, demonstrating that she is the captain now!

New Mortgage Rules

There are a few BIG changes coming to the mortgage market and, for a change, they are actually good news!

No More Stress Test for Transferring a Mortgage to A New Lender

Effective December 15th, 2024, current mortgage holders will no longer need to qualify using the "Stress Test"  if they wish to transfer their mortgage to a new lender.  Borrowers will still need to income qualify to move their mortgage, and maintain their current balance and amortization.  Qualifying will be based on the contract rate rather than the stress test.

Increasing the cap for insured mortgages to $1.5 million

Effective December 15th,  2024, applicants requiring an insured mortgage can purchase a home up to $1.5 million, which is up from $1 million.  This applies to those purchasing a home with less than 20%.   The down payment requirement is 5% of the first $500,000 of the purchase price and 10% of the remainder of the price up to $1.5 million.

30-Year Amortizations for First Time Home Buyers and New Construction Properties

First time home buyers who have less than 20% down payment and therefore require an insured mortgage, will now be eligible to get an amortization up to 30 years.  Also, all buyers of new construction properties who require an insured mortgage can also request a 30-year amortization.  

New Federal Program for Home Owners Adding a Rental Suite

Starting in January 2025, home owners wishing to use their home equity to create up to three suites in their home will be permitted to refinance their mortgage up to 90% of their property's improved value up to $2 million.  The home owner must already live in the home and be creating a separate suite(s). This program is for the creation of self-contained suites, such as basement suites or laneway homes.  Short term rentals are not permitted.  Insured mortgages with 30-year amortizations will be permitted under this program.

6.5 & 9.5 Year Old

It's amazing how fast kids grow up.  When we watch old videos we wonder how time flies. 

4th Stripe on Gray/White Belt of Jiu Jitsu

It's impressive how Robert is climbing the ranks of Jiu-Jitsu.  Next will be a Solid Gray belt!

Why You Should Own Life Insurance in a Company

Owning life insurance through your company offers several advantages for business owners and incorporated professionals. Here's why it's worth considering:

1. Tax-Efficient Funding
Premiums are paid with pre-tax corporate income, which is typically taxed at a lower rate than personal income. This tax efficiency can significantly reduce the overall cost of the policy compared to paying with after-tax personal dollars.

2. Enhanced Estate Planning
In Canada, the death benefit proceeds (minus the policy’s adjusted cost base) are credited to the Capital Dividend Account (CDA), allowing your corporation to distribute these funds tax-free to shareholders or beneficiaries. This creates an effective way to transfer wealth to your heirs or shareholders without significant tax erosion.

3. Protecting Business Obligations
A corporation can own a life insurance policy on a key employee, owner, or partner to provide liquidity for debts, buy-sell agreements, or loss mitigation in the event of their passing. This ensures your business remains financially stable and operational during unexpected circumstances.

4. Investment Growth Within the Policy
Cash value in permanent life insurance policies (e.g., whole or universal life) grows tax-deferred, making it a tax-efficient savings vehicle. The cash surrender value can also be used as collateral for loans, providing an additional source of liquidity for the business.

5. Strategic Retirement Planning
Upon retirement, the corporation can borrow against the policy’s cash value or redeem it strategically, creating a tax-efficient source of income. This ensures your family or business will have financial support even after you step away.

6. Cost Sharing and Split-Dollar Agreements
Split-dollar arrangements between you and the corporation can make premiums more affordable. Policies can be tailored to meet both personal and corporate needs, maximizing benefits.

7. Creditor Protection
Life insurance policies owned by the corporation can provide a layer of protection for assets, shielding funds from creditors in some scenarios, depending on jurisdiction and structuring.

8. Flexible Succession Planning
Life insurance ensures a smooth transfer of ownership by funding buyouts when a partner or shareholder passes away. It also provides funds to keep the company stable during transitions, ensuring long-term stability for successors.

When Is Corporate-Owned Life Insurance Right for You?
This approach is ideal if you are incorporated and have surplus cash in your company, if you’re looking for tax-efficient ways to protect your family or business, or if you have a long-term goal of optimizing estate or retirement planning.

Britannia Mines

I've visited Britannia Mines across multiple decades—from the 80s, 90s, and 2000s to 2012. Now, seeing it in 2024, it's clear they've made remarkable improvements, transforming the site into something truly impressive.

One thing is certain, though: working in a mine for 8 hours a day is something none of my family members, including myself, would ever consider. Thank goodness for mortgages, insurance, and corporate structures instead!

Sarah is a Speed Demon!

Sarah is cranking it at Whistler.  This is a jump park at Whistler for all ages and skill levels.  I highly recommend Whistler for a family mountain bike vacation!

Are Your Clients Setting Bear Traps for Themselves?

Imagine this: Your investor client is eager to dive into a commercial property deal. They’ve done their homework, talked to their regular bank, and signed on the dotted line. But what they don’t realize is, they’ve just stepped into a bear trap—set by themselves.

Here’s how it happens:

1️⃣ The Hidden Fee Trap
Many investors think, “Once I’m approved, I’m done with fees.” But commercial financing is full of surprises—appraisal costs, due diligence reports, overcharged legal fees, monthly and annual review fees, and insurance charges all come later. By the time they realize it, they’re already bleeding money.

Read the full article on Linkedin <Click>

Robert Gets His Second Stripe on his Green Belt!

Congrats to Robert!  If you have kids, it's worth having them try out Jiu Jitsu.  The skill sets he is learning applies to all aspects of his life.  

Robert & Sarah First Day in New School

We got sick of public school, so both Robert & Sarah are now in their first year of private school.  How is it going? 100x better.  

Following Bank of Canada rate cut, Macklem says it’s “reasonable” to expect more

At the beginning of September, The Bank of Canada announced a quarter-point cut to its overnight target rate, reducing it to 4.50%, and hinted that further reductions may follow if inflation trends positively. This rate is now 50 basis points below its previous peak of 5.00%. Governor Tiff Macklem suggested that additional cuts could occur depending on the inflation trajectory, emphasizing a cautious, data-driven approach. Despite easing price pressures overall, specific sectors like shelter and certain services continue to exert upward pressure on inflation.

Alongside the rate cut, the Bank updated its economic forecasts, projecting slower GDP growth for 2024 at 1.2%, down from the earlier estimate of 1.5%. Inflation is expected to remain stable at 2.6% for 2024, with a gradual decline to the 2% target by 2026. Although the recent rate cut is seen as a positive development for borrowers, rates remain restrictive relative to current inflation. Economists anticipate further cuts, with discussions suggesting potential reductions could occur in the coming months, contingent on upcoming economic data.

Sarah is going to Grade 1!

Sarah is in grade 1! 

Her 3 favorite things are:

1. Video game
2. Play at park
3. Stuffed animals
4. Biking

Robert is going to grade 4!

Robert favorite things are:

1. Video games (Fortnite)
2. Jiu- Jitsu
3. Maui Tai 
4. Mountain Biking

More Corporate Tax Math

Math of tax defferal. 

You have a choice:

1. Pay $500,000 in taxes right now
2. Pay $500,000 in taxes 40 years from now when you die

The difference?

1. $500,000 is kept in your corporation
2. $500,000 is invested for 40 years 
  2a. @8% = $10,862,260
  2b. @10% = 22,629,627
  2c. @12% = 46,525,485

These numbers sound silly, but it's 100% true.  Every dollar you pay in personal tax could have been kept in your corporate structure and invested if you have an optimized structure. 

Hanging Out With Sarah!

Having Fun in Mexico

We did not sign up Sarah or Robert for any summer camps for the beginning of July, so we decided to go to Peurto Vallarta for 10 days instead!  

Bank of Canada makes second consecutive rate cut, lowers overnight lending rate to 4.50%

For the second time in a row, Canada’s central bank has cut its overnight lending rate. 

In its pre-scheduled July 2024 announcement, the Bank of Canada dropped the target for the overnight lending rate by 25 basis points to 4.50%. 

While inflation remains above the Bank’s 2% target, it is expected that inflation will continue to ease as the global economy expands into 2026, bolstering the Bank’s decision to continue lowering rates. 

Click Here to Continue Article

Top Vancouver Summer Events and Festivals 2024

Discover the best Metro Vancouver summer events and festivals.

From fun outdoor activities to viewing incredible fireworks, to cultural performances and so much more, it doesn’t get much better than summer in Vancouver.

There are also plenty of fun-filled family events for all ages to explore.

Click Here to View Article

School is Out For Summer, School is Out Forever!

I showed my kids "School's Out" by Alice Cooper.   Within 20 seconds, they said they had no interest in old people's music and to turn it off.  I played the whole song.  

Act Like Cheetahs!

When I think of Cheetahs, my first thought is running fast and not sleeping on a tree!

Where Is The Housing Market Going

According to a recent report by Canada Mortgage and Housing Corporation, the total outstanding mortgage debt in Canada reached $2.16 trillion dollars up 3.4% from a year earlier. That increase is the smallest growth in the last 23 years.

This lower rate of growth is directly attributed to the increase in mortgage rates. Although delinquency rates are still near historic lows, the latest report shows an uptick in homeowners having difficulties making monthly mortgage payments. For the first time since the beginning of the pandemic, mortgage delinquency rates are trending up. Vulnerabilities first detected in credit card and auto loan markets are therefore moving into the mortgage market as well. The national mortgage delinquency rate hit 0.17% in Q4 2023, from a low of 0.14% in Q3 2022.

Good news is on the horizon, lower mortgage rates will be the expected trend. Combine this great news with strong population growth and increases in real disposable income, the forecast is for a healthy real estate market and that will bring higher home sales and prices.

Amazing How Time Flies

Robert is 9 years old.  This means I have another 3 to 4 Halloween's with him until he does not want to go trick or treating.  I remember when the first Halloween came around and I thought, I have 12 more to go. 

Sarah Throwing the Net for Crabbing

I think Sarah has gone crabbing 5 to 6 times now.  So far, nothing legal to keep!

What is Private Banking

It's lending for high net worth and ultra-high net worth.  It has the absolute best qualifying structures for those who have operating companies and want to own more Real Estate.  

Key points:

1. Use OPCO net income as the income regardless of what is paid to yourself personally

2. Allow ownership of rental properties and principal residence in holdco.  

Not all banks are equal and not all private bankers are equal.  You have to find the best bank with an elite private banker.  

I do this as part of the mortgage managed program. 

Robert Wins Gold at Chess Tournament!

Robert loves playing chess and is part of the chess team at his school. Last month, he participated in his first chess tournament, which attracted kids from all over the Cowichan Valley. He won gold!

Robert and Sarah Spend $30 Bucks to Win $3 Bucks Worth of Toys

They were so happy to win. These toys will now join the rest of the toys that are not played with. :)

Do Most Businesses Have an Optimized Corporate Structure?

No, not even close.

The problem is that these industries are not linked together:

Accountant
Lawyer
Mortgage broker
Commercial mortgage broker
Insurance advisor
Financial advisor
Realtor
Commercial Realtor
Etc.

Relative to your financial position, however, they are all connected.

By accident, over the last 15 years, I figured out how to connect these dots and created a framework that solves it.

Watch the video: https://www.youtube.com/watch?v=vLnvFETkiA4

Sarah Gets Her First Stripe

Congrats to Sarah on getting her first strip in Jiu Jitsu!  She was beyond happy to get it.  

Robert Does a Super Flip (Crazy)

For the first 40 seconds, the opponent was on top of Robert using his weight.  I thought he was going to lose as I didn't see how he was going to get out of it.  

Little did I know Robert was setting him up to do a 360 flip.  Boom, out of nowhere Robert flipped him and he was on top. 

He won the match 6 to 2. 

Should You Own Residential Rental Properties in your Corporation or Personal Name

If you have an operating company:
98% of the time: Corporation

If you are an employee:
98% of the time: Personal Name 

Corporations change the game dramatically with the use of small business tax rates.  Small business tax rates in BC are at 11% with net income < $500k. 

If your property is owned in the corporation, the operating company earnings can be used for:
1. Down payments
2. Negative cash flow
3. Mortgage pay down
4. Renovations

All of this is done without paying personal tax.  

If you are an employee, you already pay the maximum tax, therefore there is no real reason to use corporations outside of legal protection.