spring update 2020 - sun · 2020-04-27 · anyone can adopt better behaviours and have a more...

* Mutual funds distributed by Sun Life Financial Investment Services (Canada) Inc.The advisors at Century Group Financial Services Inc., are contracted with Sun Life Financial Distributors (Canada) Inc., a member of the Sun Life group of companies.Sun Life Assurance Company of Canada is a member of the Sun Life group of companies. © Sun Life Assurance Company of Canada, 2020.

CENTURY GROUP FINANCIAL SOLUTIONS INC. Suite 102 - 508 Riverbend Drive,

Kitchener, ON N2K 3S2

Phone: 519-747-0058 Toll free: 1-866-950-LIFE(5433)

Email: [email protected]

Julie Hoo (Partner at Century Group) and Mason Robert welcomed their baby boy into the world on Monday, March 16 at 8:03 p.m.,

weighing 8 lbs, 3 oz and measuring 22.25 inches!

Mom and baby are safe and sound at home and are both doing well. We couldn’t be more thrilled for Julie and Mason as they enter this new journey into parenthood!

IN THIS ISSUE• Can optimism improve your finances?• 3 Questions to ask when starting a business partnership• Recipe Corner• 4 charts on the benefit of staying invested - Fidelity Investments• Staying the course - Sun Life

Welcome to the Century Group family Dean John Wallace Robert

SPRING UPDATE 2020

Century Group Financial Solutions Inc.SPRING 2020 UPDATE

It may be hard to believe, but being optimistic can lead to better financial health. Can you really be optimistic even if you’re generally not a glass-half-full sort of person? Absolutely! Here’s how.

Why do some people look on the bright side, while others always see the glass as half empty?

“Whether or not you’re an optimist depends on a number of factors. Your temperament plays a major role,” explains Valérie S. Legendre, a psychologist and senior mental health consultant at Sun Life.

“Optimism also depends on your primary socialization environment – your family – and your upbringing,” she adds. “So let’s say you grew up in a family that was anxious or negative or always expected the worst. Then it’s probably harder for you to believe that things will eventually get better.”

But the good news is that optimism can be cultivated. Anyone can become more optimistic and believe in a better tomorrow. What’s more, developing optimism can affect all areas of your life:

• your good habits,• your ability to see your plans through,• your physical health,• your mental health and• even your financial health.

How optimism connects to financial health

A recent survey in the U.S. found that optimists were 7 times more likely to exhibit better financial health than pessimists. The survey didn’t define financial health in terms of wealth or income, but in terms of people’s relationship with money. For example:

• Do you have control over your finances? Are you able to make ends meet?

• Do you have financial goals? Are you on track to meet those goals?

• Do you have a financial emergency fund?• Does your budget allow you to make choices that

let you enjoy life (e.g. going out for dinner, travelling, etc.)?

Can optimism improve your finances?From www.sunlife.ca

What do optimists do when it comes to money?

According to the survey, optimists do the following things to improve their financial well-being and reduce money-related stress.

Discuss your finances with family, friends or a qualified advisor. It’s time to take the taboo out of talking about money. 76% of respondents classified as optimistic said they feel comfortable discussing money with family and friends, compared to 53% of pessimists.

Optimists were also more likely than pessimists to seek financial advice from experts. And of those who got help from investment advisors, 63% of optimistic respondents reported following their advice always or most of the time. This figure fell to 40% among pessimists.

Seek progress with small, realistic goals. Optimists see value in making progress toward a goal in small increments. That might, for example, mean saving a little bit – even just $10 a month – toward a future purchase.


Learn from a financial setback and then bounce back. The optimists surveyed were not immune from financial challenges. Far from it. But they were more likely than pessimists to say that they learned from their setbacks.

Marie-Ève Poulin, Market Director, Recruiting at Sun Life, knows a thing or two about financial optimism. Part of her work involves making sure advisors have the tools to meet their Clients’ needs.

“Among our core values, we always stress that no one is immune from a financial setback,” says Poulin. “And more importantly, that a bad financial situation now does not necessarily mean a bad financial future. Anyone can adopt better behaviours and have a more optimistic attitude toward their finances.”

5 steps to being more of an optimist

Now that you understand how optimism can benefit your bottom line, maybe you’d like to try developing a more positive outlook on the future. What should you do? Legendre has the following game plan for you.

1. Become aware of what’s holding you back. Do a little self-evaluation and reflection. What are the limiting thoughts that dominate my self-talk? For example: “I’ll never be able to get out of debt.” “Some things are impossible for me, but not for other people.”

2. Choose to change and set goals. Yes, you have to make a deliberate choice to be more optimistic. It’s the same way you would decide to be more physically active or quit smoking. You do this by setting a specific goal for yourself.As an example, let’s say your goal is to pay off your debt. Look for the meaning behind this goal. Ask yourself: What’s it in this goal that’s important to me? The answer will help you to stay on track when obstacles or temptations arise. So when you feel the urge to make an impulse purchase, you could say to yourself: Will this expense help get me closer to my goal? When you have a clear objective, it’s easier to hold firm and not get blown off course.

3. Make a plan. Your goal will look more attainable if you make it very specific and break it down into smaller steps. Why? Because each sub-goal you achieve will feel like a success. That success triggers a feeling of self-worth. And that, in turn, triggers a feeling of optimism. It’s a virtuous circle that encourages you to keep going and boosts your self-esteem.

4. Celebrate and take credit for your successes – both small and big. Optimists feel that they’re responsible for their success. However, pessimists would say it was just good luck or a coincidence. The trick here is to have a ritual around recognition. It’s a good way to develop your optimism, and it’s great for your morale and your mental health.

It could be something as simple as taking a few moments at the end of each day to look back on your small wins. For example, you might say, “Today I succeeded in staying within my budget. I resisted that impulse purchase that would have derailed me.

Don’t underestimate the impact this sort of recognition can have on your motivation. You’ll also be able to revisit these little successes when you experience setbacks or feel discouraged.

5. Frame your goals in a positive way. Be concrete and aim for something that you find pleasant or enjoyable. For example, you might want to put $5,000 in your tax-free savings account (TFSA) as a way of saving up for a family vacation. It’s a lot easier to stay on track when your goal gives you something nice to look forward to. You’ll find it much harder to be enthusiastic about a disciplinary sort of goal, such as going on a super tight budget.

Can optimism improve your finances? continued


Going into business with someone?

Here’s what you’ll want to keep in mind as you secure your finances. For an entrepreneur, finding the right business partner can be very gratifying — revolutionary, even.

You gain a teammate to bounce ideas off of as you grow. Plus, your business can benefit from the unique strengths and talents you each bring to the table.

That said, mixing your interests and resources with another person could be challenging. That’s why it’s important to secure your business together and ensure you’re both protected and prepared for the unexpected.

As you establish your partnership, it may help to ask the following questions. The answers you come across can help you start your partnership on a strong foundation of mutual benefit, trust, and respect.

What happens if your business partner is unable to work?

As co-owners, you and your business partner are both indispensable. But, what happens if your partner has an accident or a critical illness? What if an unexpected event leaves your partner unable to do their job?

One Sun Life Financial advisor, we’ll call him “John”, told us “It helps if the proper key person insurance is in place, then the business receives a cash injection that lets you replace that key partner in a much smoother way.”

This means you’ll have the funds to hire a recruiter to secure a replacement. It can even help cover the cost of any training needed for a new partner or employee. You can also have a buffer for ongoing costs — including payroll — while your business works through the transition. This way, you can focus on moving your business forward without stressing about your finances.

3 key questions to ask when starting a business partnershipfrom www.sunlife.ca


In the early stages, an advisor can help you create a plan that aligns with your business goals. This way, both you and your business partner will be working toward the same objectives — reading the same “map.”

This, in turn, will help you work together most effectively. And as your business grows, your advisor can serve as a sounding board for making more complex decisions. For example, you may want to learn more about the latest small-business tax deductions.

Or, you may want help separating your business and personal finances. “A trusted advisor can walk you through your options”, John says. “So you and your business partner can weigh the pros and cons as a team. This will also help you navigate the fastest, most efficient way to grow your business together”.

What happens if your business partner dies?

Key person insurance helps you continue to run your business in case of an illness or accident. But, you’ll also need to protect your ownership of the business in case of a death.

Your lawyers may have already written a buy/sell agreement into your business contract. This type of agreement allows you to purchase your partner’s share of the business if they die. Depending on agreement terms, it may only outline the terms of a business sale. In this case, it doesn’t provide a source of funding for the purchase.

So what happens if you don’t have the full value of your partner’s share in your personal savings? Then you might not have the funds to buy their share when you need to. “That’s where insurance comes in. Life insurance can help to protect you, your business and your family”, says John. “Just make sure each partner is listed as the beneficiary.”

The right life insurance policy means you’ll have the funding available to become the sole owner in case your partner dies. But what happens if you die? Then your partner’s life insurance policy helps to ensure they can afford to buy out your share of the business. This helps your family maintain their standard of living as well. How? They can use the money from the buy out to help cover any expenses they relied on you to pay. For instance, perhaps your family depended on you to cover a portion of the mortgage or rent. Or, maybe your kids relied on you to help fund their tuition years.

Are you and your business partner on the same page?

You and your business partner may have shared values and goals. Still, it’s important to make sure you’re on the same page about your goals and how can achieve them. “If you want to go somewhere you’ve never been before, you need a map to get there,” John says. The financial plan represents a map for the business owner.

3 key questions to ask when starting a business partnership continuedfrom www.sunlife.ca

Amazingly easy Irish Soda Breadfrom www.allrecipes.ca

INGREDIENTS

DIRECTIONS

1. Preheat oven to 375 degrees F (190 degrees C). Lightly grease a large baking sheet.2. In a large bowl, mix together flour, sugar, baking soda, baking powder, salt and margarine. 3. Stir in 1 cup of buttermilk and egg. 4. Turn dough out onto a lightly floured surface and knead slightly. Form dough into a round and

place on prepared baking sheet. 5. In a small bowl, combine melted butter with 1/4 cup buttermilk; brush loaf with this mixture. Use a

sharp knife to cut an ‘X’ into the top of the loaf. 6. Bake in preheated oven until a toothpick inserted into the center of the loaf comes out clean, 45

to 50 minutes. Check for doneness after 30 minutes. You may continue tobrush the loaf with the butter mixture while it bakes.

INGREDIENTS

• 1 (14 ounce) can artichoke hearts, drained and chopped• 1 (10 ounce) package frozen chopped spinach, thawed and drained• 1 cup mayonnaise• 1 cup grated Parmesan cheese• 2 ½ cups shredded Monterey Jack cheese

DIRECTIONS1. Preheat oven to 350 degrees F (175 degrees C). Lightly grease a 4 cup baking

dish.2. In a medium bowl, mix together artichoke hearts, spinach, mayonnaise,

Parmesan cheese and 2 cups Monterey Jack cheese. Transfer mixture to the prepared baking dish, and sprinkle with remaining 1/2 cup of Monterey Jack cheese.

3. Bake in the center of the preheated oven until the cheese is melted, about 15 minutes.

4. Serve warm with fresh bread, crackers, chips, pita, etc.

Spinach and Artichoke Dipfrom www.allrecipes.ca

RECIPE CORNER


• 4 cups all-purpose flour• 4 tablespoons white sugar• 1 teaspoon baking soda• 1 tablespoon baking powder• ½ teaspoon salt• ½ cup margarine, softened• 1 cup buttermilk• 1 egg• ¼ cup butter, melted• ¼ cup buttermilk

CORONAVIRUS MARKET UPDATES

Four charts on the benefits of staying invested during the coronavirus market dipThese four charts may help you understand the current market volatility as a result of COVID-19 and what you should know as an investor. Remember that markets have seen downturns like this before and history shows dips are followed by recoveries.

Time reduces the volatility of returns

This chart shows a comparison of the highest and lowest returns for various investment time frames from December 1980 to December 2019. For example, the results for the one-year investment time frame are based on 457 sample one-year periods: December 1980 to December 1981…December 2018 to December 2019.

As you can see, if you stay invested over time, volatility will be reduced, even across different investments.

RAN

GE

OF

RETU

RN (%

)

1 YEAR(457 PERIODS)

3 YEARS(433 PERIODS)




Canadian bondsCanadian bonds

Global equities

U.S. equities

Canadian equities

-40%

-20%

0%

20%

40%

60%

80%

100%

Source: Refinitiv. Indexes used: Canadian equities, S&P/TSX Composite Index; U.S. equities, S&P 500 Index; global equities, MSCI World Index; Canadian bonds, FTSE Canada Universe Bond Index. Based on monthly total returns (CDN$), except S&P 500 Index. Past performance is no guarantee of future results. The index returns presented are calculated monthly total returns in CDN$ (includes reinvested dividends) from December 1980 to December 2019. The three-, five-, ten- and 20-year periods reflect annualized returns. It is not possible to invest directly in an index. Returns are in CDN$ and include reinvested dividends. As at December 31, 2019.


The cycle to success

Market volatility can cause lots of panic, especially one that is linked to a global tragedy like the coronavirus. Markets have been, are and always will be cyclical. Historically, markets that have gone down eventually recovered.

This chart is a simple way to look at how many investors feel during an economic downturn. When markets start to recover, those who stayed invested tend to feel relieved, because they may benefit from the market recovery.

“Best decisionI’ve ever made”

“Let it grow!”

“A great start“

“Shouldn’t getahead of myself”

“Better callmy advisor”

“I’m reminded long-term success is the goal” “Okay, this is

more like it”

“Glad I stayed the course”

“Never hada doubt”

“What good is a goal if there’s no money left?”

“Enough is enough.”

“That’s it then. All is lost.”

“At least I’ve stopped losing”

“Compared to the markets I’m actually not so bad off”


Don’t miss out on the market’s best days

Since we can not time the market, it can be tempting to pull out your money from fear of potentially losing it all. What you don’t realize is that you put your portfolio at the potential risk of missing out on the market’s best day.

The chart below shows that a $10,000 investment can become $5,020 by missing out on 60 of a market’s best days.

Annualized returns in the S&P/TSX Composite Index

$10,000 invested from Janurary 1, 1986 to December 31, 2019

0

20000

40000

60000

80000

100000

120000

140000

160000

$160,000

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

$0

$7,225 $5,020

MISSING60 BEST

DAYS

MISSING50 BEST

DAYS

FULLYINVESTED

$61,191

MISSINGTEN BEST

DAYS

$44,203

MISSING15 BEST

DAYS

$33,396

MISSING20 BEST

DAYS

$18,342

MISSING30 BEST

DAYS

$10,000 initial investmentFinal value

$10,442

MISSING40 BEST

DAYS

$142,636

Source: Refinitiv. S&P/TSX Composite Index total returns from January 1, 1986, to December 31, 2019. Past performance is no guarantee of future results. It is not possible to invest directly in an index.


A history of epidemics and global equity returns

History has shown that when pandemics happen, markets may see some economic downturn, but they also recover. This chart below shows how returns from global equities have been affected by 12 pandemics over the last 50 years. The conclusion: markets recovered.

MSCI World Net Total Return US$ Index

EPIDEMIC 1-MONTH RETURN (%) 3-MONTH RETURN (%) 6-MONTH RETURN (%)

Pneumonic Plague – Sept-94 (1) 2.8 -0.7 3.9

SARS – Apr-03 (2) 5.7 9.7 19.4

Avian Flu – Jun-06 (3) 0.6 4.5 13.2

Dengue Fever – Sept-06 (4) 1.2 7.5 10.4

Swine Flu – Apr-09 (5) 9.1 17.8 25.2

Cholera Outbreak – Nov-10 (6) 7.4 13.6 14.8

MERS – May-13 (7) -2.5 0.5 11.6

Ebola – Mar-14 (8) 1.0 4.9 2.6

Measles/Rubeola – Dec-15 (9) -1.8 2.3 2.6

Zika – Jan-16 (10) -0.7 7.7 11.6

Ebola – Oct-18 (11) 1.1 0.7 8.8

Measles – Jun-19 (12) 0.5 0.5 9.1

Average 2.0 5.8 11.1

0

1000

2000

3000

4000

5000

6000

7000

1969

1971

1972

1974

1975

1977

1978

1979

1981

1982

1984

1985

1986

1988

1989

1991

1992

1994

1995

1996

1998

1999

2001

2002

2003

2005

2006

2008

2009

2011

2012

2013

2015

2016

2018

2019

3

7

9 10

11 12

6

1 2

5

8

COVID-19

4

Source: Bloomberg, Fidelity International, February 2020

What to do next?

Since you can’t time the market, the best thing to do is to reach out to your financial advisor and talk about what is right for your portfolio.


Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus, which contains detailed investment information, before investing. Mutual funds are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer and are not guaranteed or insured. Their values change frequently. There can be no assurances that any money market fund will be able to maintain its net asset value per unit at a constant amount or that the full amount of your investment will be returned to you. Past performance may not be repeated.From time to time a manager, analyst or other Fidelity employee may express views regarding a particular company, security, and industry or market sector. The views expressed by any such person are the views of only that individual as of the time expressed and do not necessarily represent the views of Fidelity or any other person in the Fidelity organization. Any such views are subject to change at any time, based upon markets and other conditions, and Fidelity disclaims any responsibility to update such views. These views may not be relied on as investment advice and, because investment decisions for a Fidelity Fund are based on numerous factors, may not be relied on as an indication of trading intent on behalf of any Fidelity Fund.Certain statements in this commentary may contain forward-looking statements (“FLS”) that are predictive in nature and may include words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates” and similar forward-looking expressions or negative versions thereof. FLS are based on current expectations and projections about future general economic, political and relevant market factors, such as interest and assuming no changes to applicable tax or other laws or government regulation. Expectations and projections about future events are inherently subject to, among other things, risks and uncertainties, some of which may be unforeseeable and, accordingly, may prove to be incorrect at a future date. FLS are not guarantees of future performance, and actual events could differ materially from those expressed or implied in any FLS. A number of important factors can contribute to these digressions, including, but not limited to, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition and catastrophic events. You should avoid placing any undue reliance on FLS. Further, there is no specific intentional of updating any FLS whether as a result of new information, future events or otherwise.The statements contained herein are based on information believed to be reliable and are provided for information purposes only. Where such information is based in whole or in part on information provided by third parties, we cannot guarantee that it is accurate, complete or current at all times. It does not provide investment, tax or legal advice, and is not an offer or solicitation to buy. Graphs and charts are used for illustrative purposes only and do not reflect future values or returns on investment of any fund or portfolio. Particular investment strategies should be evaluated according to an investor’s investment objectives and tolerance for risk. Fidelity Investments Canada ULC and its affiliates and related entities are not liable for any errors or omissions in the information or for any loss or damage suffered.

© 2020 Fidelity Investments Canada ULC. All rights reserved.

INM-300555 03/20 300601-v2020320

Investing for the long term? Stay the course

When markets are volatile, it’s natural to worry about your investments. And when you’re worried, you want to take action. However, the best course of action may be to stay invested.

See how it looks over timeThough frustrating, market fluctuations are an inevitable part of a long-term investment journey. Many different events have sparked volatility in the past. But, how these events play out in the long term is often similar.

Looking historically, the market has always recovered from downturns and produced gains. And those who stay invested have realized these gains over the long term.

1985 1990 1995 2000

-21.3%

“BLACK MONDAY” CRASH

September to November '87

-45.1%

FINANCIAL CRISIS

February '07 – February '09-48.7%

TECH MELTDOWN

April '00 – March '03

2005 2010 2015 2020

Global stock market represented by MSCI World Index. Source: Morningstar.

Life’s brighter under the sun

Selling in a downturn means you may miss out If you sell in a panic when the market is down, you may suffer twice, by:

1. Locking in a loss from selling at low value2. Likely missing the market rebound

Just like it’s impossible to predict a downturn, it’s equally difficult to know when the market will rally. The most likely result of selling after a downturn is missing some of the best gains during a recovery.

Let’s look at an example of a $10,000 investment on January 1, 1985.

See how missing just the 5 best days, over 35 years, means a return of $32,000 less than if you just left your money invested? In a worst- case scenario, missing the best 50 days means you end up losing money on your initial investment.

STAYING INVESTED

Missing best 5 days

Missing best 10 days



$232,572

$200,377

$177,768

$110,044

$52,938

• Initial $10,000 investment

Global stock market returns represented by MSCI World Index. Source: Morningstar. “Best days” is defined as days with the highest growth in percentage terms.

If your reasons for investing haven’t changed – stay the courseIt’s important to think about the current events in the context of your financial situation and the plans you laid out with your advisor. Making emotionally charged decisions may compromise your goals.

If you’re feeling nervous or uncertain, now might be a good time to talk to your financial advisor. Your financial well-being is your advisors’ top priority. They have the experience and expertise to guide you through difficult times.

These examples are for illustrative purposes only and are not intended to be representative of the performance of any actual or future investment available to investors. Returns are calculated in Canadian dollars and assume reinvestment of all income and no transaction costs or taxes for the period January 1, 1985 to December 31, 2019. Actual client returns would be different due to fees and expenses associated with investing.This document is provided for information and illustrative purposes only and is not intended to provide specific financial, tax, insurance, investment, legal or accounting advice and should not be relied upon in that regard and does not constitute a specific offer to buy and/or sell securities. Information contained in this document has been compiled from sources believed to be reliable, but no representation or warranty, express or implied, is made with respect to its timeliness or accuracy.© Sun Life Assurance Company of Canada, 2020. StayTheCourse_E_0320

spring update 2020 - sun · 2020-04-27 · anyone can adopt better behaviours and have a more...

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