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CANADIAN REVERSE MORTGAGE INFORMATION: EASY TO LOSE THE HOUSE IF YOU DON’T UNDERSTAND THE TERMS

canadian reverse mortgage informaitonCanadian reverse mortgage information: Introduction

Funding one’s retirement has become increasingly difficult. Pension plans are quickly disappearing and Old Age Security (OAS) and Canada Pension Plan (CPP) don’t provide adequate funds to make ends meet. However, seniors have sought Canadian reverse mortgage information.

Many seniors with homes are house rich but cash poor and they’ve discovered that a reverse mortgage is the way to tap into the mother lode and fund their retirement.

Canadian reverse mortgage information: What is a reverse mortgage?

Reverse mortgage is not a new-fangled concept or invention. In fact reverse mortgages have been around in Canada since 1983. But it’s only in recent years, as many seniors are desperate to find ways to fund their retirements, that reverse mortgages have really taken off. CHIP has the market cornered as they are the only providers in Canada of reverse mortgages.

A reverse mortgage is a loan. It’s designed for home owners who are 55+ so that they can get money without having to sell their house. The home owner receives the loan against the equity they’ve built in your property. No payments have to be made until the borrower moves out or dies. Sounds great! What could go wrong?

Canadian reverse mortgage information: What’s the catch?

You know there always has to be catch… Here is some Canadian reverse mortgage information that will shock you. If you miss a property tax payment, you go into default. It won’t be as simple as just making up the missed property tax payment and maybe paying a fee as a penalty to the lender. You will lose your home and you will have to pay your lender’s legal fees as well.

Canadian reverse mortgage information: CHIP Mortgage Corporation 5 Inc. v. Deep

It may not seem fair but it’s the law. A recent court case in Ontario, CHIP Mortgage Corporation 5 Inc. v. Deep, clearly demonstrates this law at work. The mortgage went into default because the property taxes weren’t paid and as a result this default entitled the lender to take possession of the property and sell it. In addition the borrower was required to pay the lender’s legal fees.

Canadian reverse mortgage information: Borrowing all the equity of your home may not be your answer for retirement

Before you get to the stage where you can’t make a property tax payment and risk losing your house please reach out to a professional trustee. In fact, if you realize that you can’t pay your debts heading into retirement, contact us.

We understand the pain and stress too much debt can cause. We can help you remove that pain and solve your financial problems given immediate action and the right plan. Make an appointment with Ira Smith Trustee & Receiver Inc. for a free, no obligation consultation and you can be on your way to enjoying a carefree retirement in your home Starting Over, Starting Now. Give us a call today.

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MANAGING FAMILY FINANCES: DO YOU NEED FAMILY FINANCIAL PLANNING AT 65 AND BEYOND?

MANAGING FAMILY FINANCES 0
managing family finances

Managing family finances: Introduction

Many Canadians are under the mistaken impression that financial planning is a young person’s game. After all, you’re now retired and you have your pension(s) and perhaps some savings. What financial planning is there to do for managing family finances? I’m here to tell you that it’s never too late to have a financial plan. You may not realize it but there are many financial decisions still to make – even after the age of 65.

Managing family finances: CIBC financial planning advice

Lana Robinson, executive director, CIBC financial planning and advice, says it’s never too late to plan. The biggest mistake for those heading into their 70s and 80s would be not to have a plan or mistaking a budget for a plan, she said. They might say ” ‘Well I have a budget and I’m living to my budget‘ but is that really a plan?

Have you:

  • taken into account all the needs you might have?
  • anticipated the cost of healthcare?
  • Figured out whether your goal is to have in-home care as opposed to living in a retirement home?

Managing family finances: Can you answer these seven questions?

  1. Should you take your Canada Pension Plan (CPP) at 65 or defer it?
  2. Should you take your Old Age Security (OAS) at 65 or defer it?
  3. How much do you know about Registered Retirement Income Funds (RRIFs) and annuities?
  4. Do you need to rebalance the risk in your investment portfolio?
  5. What is the most financially helpful way to use your RRSPs?
  6. What are your financial goals and what are these goals going to cost you?
  7. Are you in debt?

Managing family finances: Don’t retire in debt

If we can give you one piece of extremely valuable advice for managing family finances it’s DON’T RETIRE IN DEBT! If you do, your retirement will be extremely stressful trying to figure out how to make ends meet. Family financial planning is not fun when you need a financial plan to get out of debt. But, don’t despair – we can help.

The Ira Smith Team has many years of experience helping people just like you facing financial crisis or bankruptcy that need a plan for Starting Over, Starting Now. We approach every file with the attitude that financial problems can be solved given immediate action and the right financial plan. Give us a call today and take the first step towards a debt free retirement.

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REVERSE MORTGAGE DEBT: THE SHOCKING DETAILS OF THE INCREASE IN CANADA REVERSE MORTGAGE DEBT MIGHT MAKE YOU SQUEAMISH

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reverse mortgage debt

Reverse mortgage debt: Introduction

The number of Canadians who aren’t able to retire comfortably is alarming. Let’s face it, Old Age Security (OAS) and Canada Pension Plan (CPP) is just not enough, and seniors are in search of ways to supplement the government programs. Some are going back to work full time, part-time, consulting, selling their homes or borrowing against their homes with reverse mortgage debt.

According to the Office of the Superintendent of Financial Institutions (OSFI), reverse mortgages experienced double-digit growth in October 2017. And, they’re gaining in popularity.

Reverse mortgage debt: What is a reverse mortgage?

Aptly named, a reverse mortgage is a mortgage in reverse. It allows you to borrow against the equity in your home and you don’t have to repay the debt until you sell or transfer your home. . For some people, a reverse mortgage to pay off debt, may be attractive.

Reverse mortgage debt: Is a reverse mortgage a good idea?

There are pros and cons to a reverse mortgage and every situation is different. We’ve written a blog explaining if a senior reverse mortgage is a good or bad idea to fund your retirement.

Reverse mortgage debt: How fast is reverse mortgage debt in Canada rising?

According to OSFI filings reverse mortgages held at banks:

  • Increased by 2.02% in just one month from September 2017 to October 2017
  • Increased 22.27% in one year from October 2016 to October 2017
  • Is estimated to be rising at $1.25/second

Reverse mortgage debt: Are you struggling with debt?

With more seniors struggling in retirement, using their homes for equity is gaining in popularity and as a result reverse mortgage debt could be the fastest growing segment of debt in the country. The keyword here is debt.

If you’re struggling with debt, let’s sit down and discuss other options before resorting to a reverse mortgage. A professional trustee is an expert in debt and is in the best position to give you sound advice on how to deal with your financial struggles.

Call Ira Smith Trustee & Receiver today to book a no cost, no obligation appointment and you can be on your way to conquering debt Starting Over, Starting Now.

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CAN YOU RETIRE WITH DEBT? HOW MANY TIMES WILL YOU RETIRE?

can you retire with debt
can you retire with debt

Can you retire with debt? Introduction

Can you retire with debt? Retirement used to be so simple. You worked until the age of 65 and then retired with your defined benefit pension plan and sailed off into the sunset. Those days are gone and retirement is now very different.

Firstly defined benefit pension plans are rapidly disappearing from the landscape. We’re living longer than ever before and in many cases now have to fund 30+ years of retirement. And many seniors are dragging a debt load with them into retirement. According to Statistics Canada among those 55 and over:

Can you retire with debt? Most people cannot

As a result, many Canadians are continuing to work beyond the age of 65, although they may retire several times before ultimately retiring from all income generating activity. It’s quite common these days for someone to retire and in short order, miss the income, miss the stimulation, miss the sense of accomplishment, miss the sense of identity that can be derived from being in the workforce or just wants to get out of the house.

Although they may not want to go back to the corporate rat race on a full time basis, consulting, contracting or part-time employment are all options. Some retired seniors even open their own businesses. It’s quite possible to retire three, four or five times before retirement becomes your full-time vocation. Can you retire with debt? Most people cannot.

Can you retire with debt? Delaying retirement makes economic sense

Considering how many seniors are still in debt, delaying retirement makes good economic sense.

  • Canada Pension Plan (CPP) creates great incentives for you to delay your retirement past the age of 65. As of 2016, if you delay receiving CPP until the age of 70 you’ll receive 42% more in your monthly benefits than if you’d retired at age 65. Conversely, if you start receiving the CPP at age 60 your monthly benefits will be 36% less than if you’d waited to start your benefits at age 65.
  • Old Age Security (OAS) also provides incentives to delay retirement past the age of 65. If you wait until the age of 70 to receive OAS benefits, you’ll receive 36% more in average monthly benefits than if you’d started at age 65.

So can you retire with debt? You can try, but delaying retirement makes good economic sense.

Can you retire with debt? Let us help you retire debt free

How many times will you retire? Will you be like many Canadians who go back to work fulltime or part-time? Regardless of how many times you retire or at what age, it’s important that you retire debt free to lead a more comfortable life. A professional trustee can help you solve your financial problems and give you peace of mind in retirement. Ira Smith Trustee & Receiver Inc. can help you get back to debt free living Starting Over, Starting Now. Give us a call today.

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RETIREMENT PLANNING ADVISOR: HAVE YOU GIVEN ENOUGH THOUGHT TO YOUR RETIREMENT PLAN?

 

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retirement planning advisor

Retirement planning advisor: Introduction

We’ve written many blogs about Canadians who haven’t saved for their retirement and now find their golden years less than golden. You, on the other hand have been saving, perhaps with the help of a retirement planning advisor. So your retirement should be relaxing and fun filled. Unfortunately that’s not necessarily the case. You may not have given enough thought to your retirement plan.

Retirement planning advisor: When you planned for retirement, how long did you plan for?

Canadians are living much longer than past generations. In fact the fastest growing age group is centenarians (Statistics Canada). And now, new census data reveals that for the first time in history the percentage of seniors (16.9%) now exceeds the number of children (16.6%).

Have you planned for what could be a 30-year retirement? The Government of Canada is recommending just that.

Retirement planning advisor: Do you know how much money you would need to retire?

According to a 2015 BlackRock survey:

  • 40% of Canadians said they only had a general sense of how much money they’d need to retire
  • 33% said they had no idea what-so-ever how much money they’d need to retire

Retirement planning advisor: How much money will you get in government pensions?

Most Canadians depend on Old Age Security (OAS), Canada Pension Plan (CPP) and Guaranteed Income Supplement (GIS) for the all or most of their retirement income. Do you have any idea how much money this amounts to? This federal government calculator will give you a rough estimate of how much income to expect from CPP and Old Age Security once you retire.

Retirement planning advisor: Have you planned for the unexpected?

You may plan to work well into your 60s, 70s or beyond; but what will you do if you have to retire early because:

  • Your health won’t permit you to continue working
  • You have to assume the role of a caregiver for a loved one
  • You or a loved one require additional care

Even though you’ve been saving, it doesn’t mean you’ll have a well funded retirement. When making your retirement plan, take all of the things we’ve discussed in this blog into consideration.

Retirement planning advisor: How to get rid of a troublesome debt load

If you’re still carrying a troublesome debt load, you need more than just a retirement planning advisor. Now is the time to call a professional trustee. The earlier you can out debt behind you, the more you can save. Give the Ira Smith Team a call today and Starting Over, Starting Now your golden years will look a lot more golden.

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Reverse Mortgage Good Or Bad Idea To Fund Your Retirement

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Reverse Mortgage Good Or Bad Idea

Reverse Mortgage Good Or Bad Idea: Introduction

There are certainly differing opinions on reverse mortgage good or bad idea. There’s a lot of buzz lately about seniors using a reverse mortgage to fund retirement – on television and radio commercials, articles in magazines and newspapers and on talk shows. But, how much do you really know about reverse mortgages? Most of these promotional pieces are from companies who stand to make money from your reverse mortgage.

The Ira Smith Team is here to give you impartial and balanced advice so that you can make an informed decision whether or not a reverse mortgage is right for you.

Reverse Mortgage Good Or Bad Idea: What is a reverse mortgage?

A reverse mortgage is a loan. It’s designed for home owners who are 55+ so that you can get money without having to sell your house.

Reverse Mortgage Good Or Bad Idea: How does a reverse mortgage work?

A reverse mortgage (loan) is secured by the equity (difference between the value of your home and the unpaid balance of your current mortgage). Based on the equity in your home, you can get cash. And you don’t have to make any payments. Instead of making payments, the interest on your reverse mortgage accumulates and the equity that you have in your home decreases with time. However, if you sell your house or it’s no longer is your principal residence, you must repay the loan and any interest that has accumulated.

Reverse Mortgage Good Or Bad Idea: What are the advantages of a reverse mortgage?

  • You can get cash without having to sell your home
  • You don’t have to make payments on your reverse mortgage
  • It provides you with tax-free income
  • The income from a reverse mortgage doesn’t affect Old-Age Security (OAS) or Guaranteed Income Supplement (GIS) benefits

Reverse Mortgage Good Or Bad Idea: What are the disadvantages of a reverse mortgage?

  • They’re subject to higher interest rates than most other types of mortgages
  • The associated costs are quite high
  • The equity in your home decreases as the interest on your reverse mortgage accumulates
  • At your death your estate will have to repay the loan and interest in full within a limited time

Reverse Mortgage Good Or Bad Idea: Do You Need To Refinance Debt?

As you can see, there are pros and cons to a reverse mortgage and every situation is different. If you’re considering a reverse mortgage to deal with debt contact Ira Smith Trustee & Receiver Inc. There are many ways to deal with debt. As experts we can help you make the best choice and set you on a path to debt free living Starting Over, Starting Now. Make an appointment for a free, no obligation today.

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SENIOR CITIZEN DEBT RELIEF: DO CANADIANS BELIEVE CPP/QPP WILL BE ENOUGH?

senior citizen debt relief

Introduction

Believe it or not, when it comes to senior citizen debt relief, many Canadians believe that they can comfortably retire on Canada Pension Plan (CPP) and Old Age Security (OAS) benefits alone. According to a 2014 Bank of Montreal study:

  • 89% of Canadians said they expected CPP or the Quebec Pension Plan to fund part of their retirement
  • 31% said they expected to rely heavily on their CPP/QPP

Is expecting the government to fund your retirement realistic?

No! Paul Shelestowsky, a senior wealth adviser with Meridian Credit Union in Niagara-on-the-Lake, Ontario believes that Canadians are playing a dangerous game with their future by expecting the benefits of making up for meagre savings. “CPP and OAS were never meant to form somebody’s retirement plan. They were meant to augment it and help as one of the pieces of the puzzle,” Mr. Shelestowsky says.

Do you know how much you’d earn if CPP and OAS were your only sources of income in 2015?

Your net income would be $17,883/year or $1,490/month. Could you possibly live out your golden years in the manner you had imagined with such a scant income? How would you ever obtain senior citizen debt relief?

If you’re like many Canadians you’re in a total state of shock right now. In 2013, a Leger Marketing survey for H&R Block found that 7 out of 10 non-retired Canadians were unaware of how much money CPP pays out monthly. The maximum in 2015 was $1,065 a month, but this is the maximum. The average CPP payment is only about $550.

What about senior citizen debt relief?

How many of you could maintain close to your current lifestyle on $1,490/month? It would be hard enough to pay your monthly bills, let along pay down your liabilities. Yet seniors are adding to their financial load even faster than the general population, with the average Canadian senior owing approximately $15,000. This is a serious issue and as a result, we’ve done a series of blogs/vlog about this issue:

Your solution

If you’re in need of senior citizen financial relief, you need a professional trustee to help you manage your financial problems before it reaches a critical stage where bankruptcy is your only option. We have been able to help many seniors carry out a successful debt settlement program. Successful completion of such a program will free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life.

You should never take liabilities into retirement. NOW is the time to deal with financial problems; not once you’re on a seriously limited income and barely making ends meet. Sit down with a professional trustee and discuss your options. We’re experts on dealing with senior citizen debt relief and not so senior citizen financial issues. With immediate action and the right financial plan in place, you can be well on your way to a debt-free life Starting Over, Starting Now. Contact Ira Smith Trustee & Receiver Inc. today. Help is only a phone call away.

 

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