tmk794e solutions winter09 final

8/14/2019 TMK794E Solutions WInter09 FINAL

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INVESTING IN STYLE

Ready to ride amarket recovery?

MK2364E

12/09

TMK794E

f o r f i n a n c i a l p l a n n i n g M a n u l i f e I n v e s t m e n t s

Winter Edition 2010


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cake cake


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Some guaranteed interest products are better than others, and a Manulife Investments GIC (Guaranteed

Interest Contract) offers you more. Enjoy the strength and stability of a trusted insurance company, the

ability to pass your money on tax-free to beneficiaries, plus a very competitive rate in todays market.

Get more than just a return on your investment. Contact your advisor to learn more.

Not all GICs are created equal.

The Manufacturers Life Insurance Company is the issuer of the Manulife Investments Guaranteed Interest Contract (GIC). Manulife and the block designare registered service marks and trademarks of The Manufacturers Life Insurance Company and are used by it and its affiliates, including ManulifeFinancial Corporation.


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The persons and situations depicted

in Solut!ons are fictional and theirresemblance to anyone living or dead

is purely coincidental. Solut!ons is

not intended to provide legal,

accounting or financial planning

advice. Readers should not rely solely

on Solut!ons, but should seek the

advice of a qualified professional.

E & O E. No liability is accepted by

Manulife Financial or its officers and

employees for the consequences of

any errors and omissions or for the

nature and content of this or any

other referenced pages.

Copyright in this magazine is held

by The Manufacturers Life Insurance

Company (Manulife Financial). You

are free to make copies of this

magazine (or individual articles) and

to distribute it, either in paper form

or electronically, as long as you

identify the source and do not

change or remove any part of this

work. All other uses are prohibited.

Distributed Winter 2010

While the financial markets continue to exhibit high levels ofvolatility, many investors are now wondering if they missed thechance to participate in the recent recovery in stock markets. If youshare these concerns, this is an ideal time to revisit your financial planwith your advisor to ensure that you make the most of opportunitiesthat may lie ahead.

This edition ofSolut!ons provides a number of ideas on how to do justthat. Todays markets offer a wealth of potential for investors with long-term time horizons to grow their savings by taking a more

comprehensive approach to their finances.

In Investing in style, you will gain more insight into how investment stylessuch as value, growth and growth at a reasonable price tend to perform

throughout a market cycle. You will also learn how each investmentstyle may appeal to different personality types, and why its importantto incorporate diverse approaches into your portfolio to help smoothout investment returns over time.

Ready to ride a market recovery? discusses low-cost Guaranteed InvestmentFund products that offer growth potential and also include addedbenefits of interest to many investors. Could you use more broccoli in yourportfolio? provides an overview of Guaranteed Interest Contracts issuedby insurance companies and how they can provide extra estate planning

features that are unavailable from bank-issued Guaranteed InvestmentCertificates. Finally, Lower your familys tax bill outlines an income-splitting

strategy that can help your household save money.

After reading the articles included in this edition ofSolut!ons magazine,we invite you to speak with your advisor about the financial strategies

that may be right for you.

Sincerely,

J. Roy Firth, Executive Vice President

Individual Wealth Management, Manulife Financial

Are you missing

the recovery?

10%

Cert no. SW-COC-789


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Manulife Investments is the brand name identifying the personal wealth management lines of business offered by The Manufacturers Life Insurance Company (Manulife Financial) and its subsidiariesin Canada. As one of Canadas largest integrated financial services providers, Manulife Investments offers a variety of products and services including segregated fund contracts, mutual funds,annuities and guaranteed interest contracts. Manulife and the block design are registered service marks and trademarks of The Manufacturers Life Insurance Company and are used by it and its affiliatesincluding Manulife Financial Corporation. Any amount that is allocated to a segregated fund is invested at the risk of the contractholder and may increase or decrease in value. Commissions, trailingcommissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values changefrequently and past performance may not be repeated. Statistics Canada information is used with the permission of Statistics Canada. Users are forbidden to copy the data and redisseminate, in anoriginal or modified form, for commercial purposes, without permission from Statistics Canada. Information on the availability of the wide range of data from Statistics Canada can be obtained fromStatistics Canadas Regional Offices, its World Wide Web site at www.statcan.gc.ca, and its toll-free access number: 1 800 263 1136.

12 Could you use more broccoliin your portfolio?GICs OFFER PREDICTABLE INVESTMENT RETURNS

AND SOME HAVE INSURANCE BENEFITS TOO

16 Ready to ride a market recovery?GUARANTEED INVESTMENT FUNDS PROVIDE

FLEXIBILITY, GROWTH POTENTIAL AND

VALUABLE ADDITIONAL BENEFITS

20Lower your familys tax bill

HOW TO TAKE ADVANTAGE OF INCOME

SPLITTING USING INTRA-FAMILY LOANS

24 Lights! Camera! Action!IF YOUR LIFE IS A MOVIE, THEN YOURETHE STAR. ARE YOU PREPARED FOR YOUR

NEXT SCENE?

28 Is it time to take the training wheels offyour banking products?

32 RRSP? TFSA? RESP?SORTING THROUGH AN ALPHABET SOUP OF

ACRONYMS TO MAKE THE BEST CHOICE

34 Caught in the middle?STRATEGIES FOR THE SANDWICH GENERATION

38 Fun & food

6Investingin styleLET YOUR INVESTMENT PERSONALITY

SHINE THROUGH

Whats Inside


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6 Solut!ons for financial planning

INVESTING in

STYLE


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7Winter Edition 2010

In everyday life, we often hear the word style used to describe peoples outward

appearance. But style is about more than the shoes we wear, the handbags we covet and

the latest trends from the runways in Paris. Style can be defined as the way we express

ourselves outwardly through our personalities and that includes our thoughts, emotions,

interests and values.

LET YOUR INVESTMENT PERSONALITY

SHINE THROUGH

s strange as it may

sound, it is nodifferent when it

comes to investing.How people approachthe complex world of

finance often reflects their

personality. If you are thinkingabout investing in equity mutualfunds, consider determining whichinvestment style best suits yourown personality and then mix

and match to create a diversified

style all your own.Investment style refers to

the approach that investors

including professional moneymanagers take in selectingindividual investments andassembling portfolios as they seek

to achieve their investment goals.

While there are a great number of

investment styles in the field ofmoney management including

hybrids that combine elements ofdifferent styles in general, thereare three fundamental investmentstyles that dominate the world of

mutual fund investments: value,growth and growth at a reasonableprice (GARP).

VALUE INVESTING

Value investors seek stocks of

companies that they think themarket has undervalued due toshort-term concerns. Manyinvestors believe that the market

can overreact to good and badnews, resulting in stock pricemovements that do not reflect acompanys long-term fundamentals.

The result is an opportunity for

value investors to profit by buyingwhen the price is lower. Value

investors will typically sell astock when its price has climbedto a level where it reflects thecompanys estimated intrinsic

value, allowing other investorsto take on the risk that thecompany will achieve higherrates of growth over time.

On the surface, the concept

behind value investing makes a lot

of sense. Yet it can be very difficultto estimate the intrinsic value of astock with great accuracy. For this

reason, another important idea thatgoes hand in hand with valueinvesting is that of establishing amargin of safety. A margin of safety

simply means that you buy a stock

A


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at a considerable discount tothe estimated intrinsic value to

allow some room for error inyour calculations.

Value investors may need toride out periods of volatility inorder to achieve higher returns.There is the threat of value traps,

where a stock is cheap for a goodreason and the price continues tofall. In addition, value investorsmay have to wait for extended

periods of time before a company

recovers, so this approach requiresconsiderable patience.

INVESTING FOR GROWTH

Growth investors look to purchasestocks they believe have superiorgrowth potential. In most cases,

a growth stock is defined as acompany whose earnings areexpected to grow at an above-average rate compared to similar

companies in its industry or themarket as a whole. Those whofollow this strategy tend to invest ina stock even if the share price mayappear expensive in terms of

investment measurements, althoughthere can be considerable variation

in how growth-oriented investorsseek out stocks. For example, more

aggressive growth investors may beinterested in purchasing stocks thathave risen in value substantiallyover a three- to 12-month periodin the belief that there is sufficientmomentum in the stock to pursue

further gains. More conservativegrowth investors may seekcompanies with a history of risingdividends or base their purchase

decisions on a cyclical change in

the underlying economy that maylead to higher rates of growth.Recent examples of sectors that

attracted growth-oriented investors

attention include technology andnatural resources. In the late 1990s,technology stocks posted very highreturns as technology companies

reported exceptional rates ofgrowth. More recently, commoditystocks soared in anticipation ofhigher demand for commodities

from developing countries such asChina. Investors who purchasedshares in these sectors had thepotential to do very well while theeconomy was running at full steam.

But these same investors alsosuffered significant losses duringthe bear markets that followed,

INTRINSIC VALUE IS THE ACTUAL VALUE

OF A COMPANY OR AN ASSET, BASED

ON AN UNDERLYING PERCEPTION OF

ITS TRUE VALUE, INCLUDING ALLASPECTS OF THE BUSINESS AND TAKING

INTO ACCOUNT BOTH TANGIBLE AND

INTANGIBLE FACTORS.


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illustrating that growth-orientedinvestors tend to experience morevolatility than value-orientedinvestors. In other words, their

investments tend to rise faster inbull markets and drop moresharply in bear markets.

GROWTH AT A

REASONABLE PRICE (GARP)

GARP is an investment strategy thatcombines growth investingprinciples and value investingtactics to select stocks. By looking

for companies that are somewhatundervalued and have solid growthpotential, GARP investors takeadvantage of the best features of

the growth and value-orientedinvestment styles. In a bear market,one could expect the returns ofGARP investors to be higher thanthose of pure growth investors, but

to trail those of value investors.

WHICH STYLE BEST FITS

YOUR PERSONALITY?

It is easy to understand why certain

personality types may gravitatetowards one investment style morethan another. Some people love theidea of shopping for bargains andtherefore favour mutual funds that

adopt a value-oriented investmentapproach. Other personality typesmay enjoy purchasing cutting-edgeelectronics or new car models

rather than more reasonably pricedalternatives. They may relate betterto the growth model of investing.

Others still tend to avoid eitherextreme and make purchasedecisions based on their perceptionof finding brand names atreasonable prices. Whatever your

personality type, remember thatwhen it comes to achieving yourfinancial goals, diversificationremains the cornerstone of long-term investing success.

MAKE A FASHION

STATEMENT WITH MORETHAN ONE STYLE

Many investors have come tounderstand the importance of

diversifying their investmentsacross the various asset classes stocks, bonds and money marketsecurities to smooth out their

investment returns over time. Asweve already suggested, differentinvestment styles also perform

differently at different times, soholding value, growth and GARPmutual funds in your portfolio can

be an effective diversificationstrategy too.

The chart on the following pageillustrates the historical investment

returns of the S&P 500 Index tohelp demonstrate the importanceof diversifying by investment style.

Lines that appear above the axisin this graph illustrate both thefrequency and degree by whichvalue-oriented stocks outperformedgrowth-oriented stocks since

December 1975. Lines thatfall below the axis indicatethe frequency and degree bywhich growth-oriented stocksoutperformed their value-oriented

peers over the same time period.As you can see, there have been

extended time periods duringwhich one investment style

dominated the other in termsof providing superior returns.

Since it is difficult to predictwhich style will outperform atany point in time, the lesson that

can be learned from this chart isthat it makes sense to diversifyby investment style. Heres why.

We can determine by looking

at the chart that a value-orientedinvestor would have received lowerreturns than a growth-oriented


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investor during the late 1990s. Ifyou were a value-oriented investorwho had to sell investments

during this time period to coverunexpected expenses, you wouldlikely have had less capital to turn

to than a growth-oriented investor,since value investments generallyproduced lower returns.

Now fast-forward a few years.If you were a growth-orientedinvestor who had planned to retire

in 2000, the technology sell-offthat followed may have negativelyaffected the value of your portfolio.

The loss of capital that youexperienced due to the downturnmight have meant delaying your

retirement and kept you workinglonger than you planned.

Since no one knows how the

markets will perform over theshort- to mid-term, it only makessense to hedge your bets byincluding a number of mutualfunds that incorporate the value,growth and GARP investment styles

in your portfolio. This should helpyou smooth out your investmentreturns over time.

SPEAK WITH

YOUR ADVISOR

If you are considering

making changes to your

portfolio in the hope ofcapturing the future growth

potential of the financial

markets, begin by speaking

with your advisor. He or she

can point out the various

mutual fund investment

options available to you and

can further discuss the

advantages of each

investment style. In the end,

you may decide that a

particular investment style

best suits your personality,

but dont forget that

diversification remains a key

component of any well-

thought-out financial plan.

THERE HAVE BEEN EXTENDED TIME

PERIODS DURING WHICH ONE

INVESTMENT STYLE DOMINATED

THE OTHER IN TERMS OF PROVIDING

SUPERIOR RETURNS.

40%

30%

20%

10%

0%

10%

20%

30%

40%

Dec-75

Dec-77

Dec-79

Dec-81

Dec-83

Dec-85

Dec-87

Dec-89

Dec-91

Dec-93

Dec-95

Dec-97

Dec-99

Dec-01

Dec-03

Dec-05

Dec-07

For illustrative purposes only. Source: Global Financial Data. Past performance is not indicative of future performance/returns.

Value vs. Growth: 12-month Rolling Returns

(S&P 500/Citigroup Growth and Value Indexes)

Value outperforms

Growth outperforms


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Now that AIC Funds is part of the Manulife fund family, you can look forward to even greater breadth from our world cla

mutual funds. That means more choice and flexibility to help meet your investment needs. And with AICs steadfast approacto investing, well, lets just say its a perfect fit for Manulife. To learn more visit manulifemutualfunds.ca or talk to your advis

Manulife together with AIC Funds.For investment options that fit you even better

Manulife Funds are managed by Manulife Mutual Funds, a division of Elliott & Page Limited. Manulife and the block design are registered service maand trademarks of The Manufacturers Life Insurance Company and are used by it and its affiliates including Manulife Financial Corporation.


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COULD YOU USE

more broccoliin yourportfolio?


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hese guaranteedinvestment productsthat earn interest maynot seem as appealing

or exciting asinvesting in an emerging marketmutual fund or commodity index the veritable chili peppers of the

investment world. In fact, to somepeople, they are uninteresting

investments in the same way thatbroccoli can seem uninteresting

when compared to the latestgourmet food trend. We all knowthat broccoli is very good for you,and it is highly recommended bynutritionists everywhere. But, given

the choice between a side of boiledbroccoli and a side of roasted garlic

smashed potatoes, its notunusual to find the better-for-youoption politely left behind.

Nevertheless, with many stock

market indexes reporting negativereturns, a little certainty can go along way towards providing you

with more confidence when savingfor your retirement. And there is alot more to todays insurance GICsthan many people may realize,

making them healthy additions toany well-balanced financial plan.

GICs OFFER PREDICTABLE INVESTMENT RETURNS

AND SOME HAVE INSURANCE BENEFITS TOO

Its a rather strange question to be sure, but after experiencing one of the worst

economic downturns since the Great Depression, many investors are looking for safe

investment products that are capable of producing predictable investment returns. For

many, this means investing in guaranteed investment products, such as Guaranteed

Interest Contracts issued by insurance companies (GICs) or Guaranteed Investment

Certificates issued by banks (bank GICs).

T

GICs CAN BE A GREAT FIT FOR MANY

INVESTORS LOOKING TO ADD MORE

CERTAINTY TO THE FIXED-INCOME

PORTION OF THEIR PORTFOLIO.


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GICs A HEALTHY

ADDITION TO EVERY

FINANCIAL PLAN

Diversifying your investmentsamong equities, fixed-income

investments and cash has been the

cornerstone of sound financialplanning strategies for some time.And GICs can be a great fit for

many investors looking to addmore certainty to the fixed-incomeportion of their portfolio.

GICs do offer one very important

advantage when compared to otherfixed-income investments: theyoffer a guaranteed interest rate, nomatter what the financial marketsare doing. This can help to reduce

overall investment risk within yourportfolio while youre saving foryour retirement years.

THE INSURANCE

ADVANTAGE

Many investors realize that youcan purchase bank GICs at yourlocal branch. But did you knowyou can buy similar investment

products offering very competitive

rates from insurance companies?

GICs issued by insurancecompanies offer three distinctfeatures that set them apart frombank GICs: an estate planning

benefit, more extensive potentialprotection from creditors and taxadvantages for non-registered

contracts. The estate planningbenefit means that if you namea beneficiary other than yourestate on the insurance GICcontract at the time of purchase,

the proceeds (including interest)of your investment will bypassyour estate if you pass away. Thisis significant because it meansthat your beneficiaries will receive

the proceeds privately1 and directly,without administrative charges,

while avoiding potential probateand estate fees.

Insurance-based GICs may alsoprotect your personal savings fromprofessional liability. As long as theGIC investment is made before an

individual or business runs intofinancial difficulties, generallythe proceeds of the GIC will beprotected from creditors. This canbe an attractive feature for owners

of small businesses or those in anyother profession where liabilities

1Not applicable in Saskatchewan


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have the potential to threaten yourpersonal savings.

For clients age 65 and older,interest from a non-registered

GIC is eligible for the pensionincome tax credit and pensionincome splitting.

WHATS ON THE TABLE?

Todays insurance GICs come with avariety of investment options that

may make them attractive holdingswithin your portfolio. The followingtable provides a brief overview ofthe options that are generally

available in the marketplace.

SAY MORE PLEASE

TO TODAYS GICsIf you are looking for ways to

add more stability to your overallfinancial plan, speak to your

advisor about adding insuranceGICs to the fixed-income portionof your portfolio. Not only areinsurance GICs a healthy addition

to your financial plan, but withoptions that include cashable, non-cashable, laddered, escalating rate

and equity-linked, todays GICs area lot more interesting too.

GIC TYPE FEATURES BENEFITS

Cashable Terms ranging from six months to 10 years

may be available

Simple or compound interest optionsmay be available

Cashable in whole or in part at any time*

Flexible terms may be available

Funds can be accessed at any time*

Non-cashable Terms ranging from six months to 10 years

may be available

May provide higher rates than basic cashable GICs

Simple or compound interest options

may be available

Cannot be cashed until maturity

Flexible terms may be available

Investors have the ability to earn higher rates

of interest

Laddered Distributes investment across multiple term lengths

Typically a portion of the investment matures

each year

Simple or compound interest options

may be available


Provides investors with greater protection

from fluctuating interest rates

Takes advantage of higher long-term rates

Provides a diversified maturity structure

May offer the option to access funds at any time*

Escalating Rate/

Step-up Rate

Terms of three or five years may be available

Increasing rates for each year of the term

Attractive posted rate for last year of the term


Interest rate is guaranteed to increase each year

of the term

You can lock in now for attractive interest rates

in later years May offer the option to access funds at any time*

Equity-linked Links returns to market-based investments

Investment growth is credited as interest

on the maturity date

Principal is 100 per cent guaranteed at maturity

May not be cashable during the term

Investors can participate in the growth of the

markets with a 100 per cent principal guarantee

Allows investors to diversify their GIC investments

May provide higher returns at maturity than a

typical GIC

*May be subject to early redemption charges.


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aMARKET

Ready to ride

RECOVERY?


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WHAT ARE GUARANTEED

INVESTMENT FUNDS?

Guaranteed Investment

Fund product,otherwise knownas a segregated

fund contract, isan insurance contract offeredthrough an insurance company.These investment vehicles typicallyprovide several investment options

managed by many different fundmanagers in a wide range ofasset classes. In addition,Guaranteed Investment Fundscan deliver a number of features

unavailable through other types

of investment vehicles.Depending on the type of

contract, Guaranteed Investment

Funds can offer benefits includingincome protection from marketdownturns, maturity guarantees andguaranteed death benefits. Investorstypically pay additional fees for

these types of protection features.

Some investors includingyounger investors may not

need these protection features.Fortunately, some insurancecompanies now offer a baseGuaranteed Investment Fund

contract that doesnt include

more expensive guarantees untilthey are needed. Fees are highly

competitive with those chargedby mutual funds but even thebase contracts include someadditional benefits of interest

to many investors.

A

As financial markets begin to look more promising, many people are reviewing their

investments with an eye towards capturing future growth. Many investors are looking for

diversification, a wide range of investment options and professional money management

services all for a reasonable fee. Did you realize that Guaranteed Investment Funds offer

all these features and potentially a lot more at a very competitive price?

A GUARANTEED INVESTMENT FUND

PRODUCT, OTHERWISE KNOWN AS A

SEGREGATED FUND CONTRACT, IS AN

INSURANCE CONTRACT OFFERED

THROUGH AN INSURANCE COMPANY

[WITH] BENEFITS INCLUDING INCOME

PROTECTION FROM MARKET

DOWNTURNS, MATURITY GUARANTEES

AND GUARANTEED DEATH BENEFITS.

GUARANTEED INVESTMENT FUNDS

PROVIDE FLEXIB ILITY, GROWTH PO TENTIAL

AND VALUABLE ADDITIONAL BENEFITS


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GETTING DOWN

TO BASICS

The following features are commonto all segregated funds offered by

insurance companies.

ESTATE PLANNING BENEFITS

Death benefit guarantee: In theevent of death, your beneficiariesare guaranteed to receive 75 per

cent of all deposits made (reducedproportionally by withdrawals)even after market downturns.

Bypass of estate: In the event ofdeath, unless you have namedyour estate as beneficiary, the

proceeds of an insurance contractcan pass privately1 and directly

to your designated beneficiaries,without the expense and delay of

settling the estate. That way, theproceeds avoid probate and estateadministration fees, meaning moremoney goes to your beneficiaries

quickly and efficiently.

CREDITOR

PROTECTION BENEFITS

As insurance contracts, Guaranteed

Investment Funds have the potentialto protect an investors assetsfrom creditors. This feature is

ideal for professionals and smallbusiness owners looking to helpshield their personal assets fromprofessional liability.

MORE FLEXIBILITY, MORE

INVESTMENT CHOICE

Another benefit of baseGuaranteed Investment Fund

contracts is the flexibility andvariety of investment choicesthey provide. Depending onthe company you invest with,

many different GuaranteedInvestment Funds may beavailable, representing a rangeof asset classes includingCanadian and global equity

funds. Whats more, you canmove your deposits among anumber of highly respectedasset management firms generally

without triggering switchingcharges or redemption fees.

Additional advantages providedby some companies that offerGuaranteed Investment Funds

include an objective fund managerselection and monitoring processthat helps to ensure that each

fund remains true to its statedinvestment objective. Thesemonitoring processes typically

use stringent criteria to makesure the investment funds availablerepresent the highest-qualityinvestment managers. Youll never

have to second-guess your choiceof investments again.

SPEAK WITH

YOUR ADVISOR

If you are interested in

capturing the growth

potential of the financial

markets and are considering

how to invest, ask your

advisor about Guaranteed

Investment Funds thatinclude a base contract

option. These investments

offer the same growth

potential and flexibility of

many other traditional

investments, but provide

additional features and

benefits that make them an

attractive alternative for

investors looking to grow

their wealth.

1Not applicable in Saskatchewan


19/40


20/40


Lower your familys

TAX BILL


21/40


ncome splitting

involves the transfer ofincome from a high-income earner to afamily member in a

lower tax bracket. The lower-income individual is taxed at alower marginal tax rate, so the

family pays less tax overall.The problem is that the Canada

Revenue Agency (CRA) restrictsmost forms of income splittingthrough the Income Tax Actsattribution rules. An individual

cannot simply give a spouse$100,000 to invest and have thespouse declare the investmentincome on his or her tax return

so the money is taxed at a lowermarginal tax rate. In such asituation, the investment incomewould be attributed back to the

individual and taxed at his or herhigher marginal rate.

There are, however, a fewlegitimate ways to split taxableincome with a spouse or minor

child. In a low interest rate

environment, one of the most

effective strategies is through anintra-family loan to a spouse oranother family member.

WHAT ARE THE

BENEFITS OF AN

INTRA-FAMILY LOAN?

Provided the loan is properlystructured, the recipients of anintra-family loan can invest the

loan proceeds and any investmentincome they earn will be taxed attheir lower marginal rates. Intra-family loans are most commonly

made between spouses, eithermarried or common-law, but thisstrategy can also be effective withminor children.

To ensure the income attributionrules do not apply to investmentincome earned by the loanproceeds, two loan conditionsmust be met:

The loan must charge interestat a rate that is at least equal to

the prescribed rate (updated

quarterly) set by the CRA at the

time the loan is made; if thecommercial loan rate is lowerthan the prescribed rate at thetime the loan is made, this lower

commercial rate can be used

The annual interest owing on

the loan must be paid to thelender no later than 30 daysafter the end of each year

I

People often consider tax-saving strategies on an individual basis, but overlook family

strategies that can save significant tax dollars. One good example is the income splitting

you can achieve by lending money within a family.

HOW TO TAKE ADVANTAGE OF INCOME SPLITTING

USING INTRA-FAMILY LOANS

WHO ARE THE IDEAL

CANDIDATES FOR AN

INTRA-FAMILY LOAN?

Income splitting through

intra-family loans is best

suited for people who have:

A pool of non-registered

capital they are willing

to invest

A spouse or minor

children in a lower

marginal tax bracket


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This means that one of the keysto a successful income splittingstrategy is to ensure that investmentreturns are higher than the

interest rate charged on the intra-family loan.

TAKE ADVANTAGEOF TODAYS LOW

INTEREST RATES

If you lend your spouse moneyfor the purpose of income splitting,the prescribed rate (the rateof interest you charge your

spouse) remains fixed for theterm of the loan.

This is a considerable advantagein todays low interest rate

environment. For example, theprescribed rate in the fourthquarter of 2009 is one per cent.

ALREADY HAVE A

PRESCRIBED RATE LOAN?

You can still take advantage oftodays lower interest rate. If youand your spouse implemented thisstrategy in the past, when the

prescribed rate was higher, there

is a way to take advantage of thecurrent lower rate to increase yourtax-saving opportunity.

First, your spouse must repay

the existing loan its not enoughto just re-sign the loan agreement.To do this, your spouse may haveto sell some investments and

this may result in capital gains.However, any gains will be taxed inyour spouses hands, and thereforeless tax will be due than if you

held the investment yourself.You can then enter into a new

loan at the current lower prescribedrate and your spouse can purchasenew investments.

For illustration purposes only.

CASE STUDY: JOHN AND JILL SAVE TAXES WITH AN

INTRA-FAMILY LOAN

Spouses John and Jill are looking for ways to lower their familys taxbill. They are in different tax brackets John at 45 per cent and Jill at

22 per cent. John lends Jill $100,000 at a prescribed rate of one percent.1Jill invests the money and earns four per cent, or $4,000. Shethen pays John $1,000 in loan interest and deducts the same amountas a loan interest expense.

Jill pays $660 in tax on the remaining $3,000, and John pays $450

on his interest income. If John hadnt made the intra-family loan andhad instead invested the $100,000 himself, he would have paid$1,800 in taxes. By lending the money to Jill for the purpose ofincome splitting, the familys tax bill is reduced by approximately

38 per cent to $1,110, representing a savings of $690.

NO LOAN

45 per cent tax

rate (John) ($)

45 per cent tax

rate (John) ($)

22 per cent tax

rate (Jill) ($)Principal loan 100,000 -100,000 100,000

4 per cent investment return 4,000 4,000

1 per cent interest on loan 1,000 -1,000

Net income 4,000 1,000 3,000

Tax payable by each person 1,800 450 660

Total tax payable by the family 1,800 1,110

INTRA-FAMILY LOAN

SPEAK WITH YOUR ADVISOR

To benefit from the income splitting you can achieve using an

intra-family loan, you will need to:

Select investments with expected returns that are higher

than the current prescribed interest rate

Formalize the intra-family loan through a promissory note

If you would like to take advantage of this tax strategy but are

unsure where to start, begin by speaking with your advisor. He or she

can help you choose appropriate investment vehicles that help you

make the most of this income-splitting opportunity without taking on

undue risk.

1For the fourth quarter of 2009 (October 1, 2009 to December 31, 2009), the CRA prescribed rate is one per cent.The prescribed rate is updated quarterly and published at www.cra-arc.gc.ca/tx/fq/ntrst_rts/menu-eng.html.


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Lipper Awards reflect risk-adjusted performance over 1, 3, 5 or 10 years. The performan ce of the Mawer Funds does not mean that the Manulife Mawer Funds will provide the samereturns. Commissions, trailing commissions, management fees and expenses may all be associated with mutual fund investments. Please read the prospectus before investing. Mutualfunds are not guaranteed, their values change frequently and past performance may not be repeated. Manulife Funds and Manulife Corporate Classes are managed by Manulife MutualFunds, a division of Elliott & Page Limited. Manulife Investments is the brand name identifying the personal wealth management lines of business offered by the Manufacturers LifeInsurance Company (Manulife Financial) and its subsidiaries in Canada. Manulife and the block design are registered service marks and trademarks of the Manufacturers Life InsuranceCompany and are used by it and its affiliates including Manulife Financial Corporation.

Manulife Growth Opportunities Fund (10 years)

Manulife Monthly High Income Fund (10 years)

Manulife Structured Bond Class (5 years)

Manulife China Opportunities Class (1 year)

Manulife Mutual FundsManaged by MFC Global Investment Management

Best Equity Fund Family

Mawer World Investment Fund (5 years)

Mawer World Investment Fund (10 years)

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Mawer Investment Management Ltd.Manager of Manulife Mawer Funds

When the going gets tough,the tough outperform.

These funds were ecognized at t e prestig ous 2009 Li per Awards for delivering

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ca enefit from he award-winning approach offered throug anulife M tua unds y

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Lights!

Camera!Action!


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SETTING THE STAGE

o make sure yourfinancial plan follows

your script, you needto set the stage.Determine where you

are in life and what your protectionneeds are not just for today, but

in the future your next scene.You need to consider a number

of risks that could keep you fromreaching your lifetime financial

goals and objectives. Up until now,your primary risk has been loss ofincome how would your family

survive if you were to dieprematurely? As you move into

your later stages (dont worry itsthe best part of any movie), therisks change and you need to shiftyour focus from protecting your

income to protecting your assets.The financial plan you put together

for the first stage probably wontmeet your needs for the second.

The diagram below is called the

Risk Management Framework. It

shows how your needs changethroughout your life from incometo asset protection and it showswhich insurance products can help

protect your changing risk.

ACT 1, SCENE 1

You can see that during youryounger years (roughly ages 30

to 50), the emphasis is on incomeprotection and as you get older,it shifts to asset protection.

Critical illness insurance isprobably one of your most

When actors make a movie, they spend a lot of time rehearsing the next scene. Life is

like that think about how your financial plan is a rehearsal for whats to come. With agood financial plan, youll be prepared for whatever your next scene brings. Without

one, you might find your happily ever after ending lying on the cutting room floor.

If your life is a movie, then youre the star.

Are you prepared for your next scene?

T

Long TermDisability

TermInsurance

PermanentInsurance

Critical Illness

Income Protection Asset Protection

Long TermCare

30 35 40 45 50 55 60 65 70 75 80 85


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important priorities, which iswhy it spans both life stages.This important insuranceproduct provides a one-time cash

benefit if you are diagnosed withone of the covered conditions(you also need to survive the

waiting period, which is typically30 days). While you can getplans with over 20 coveredconditions, most plans cover youfor the most common critical

illnesses: cancer, heart attack andstroke. The cash benefit youreceive will help to reduce thefinancial stress you might haveif youre faced with a critical

illness. The money allows you tofocus on recovery because you

dont have to worry as muchabout things like your monthly

mortgage payment and additionalexpenses such as child care ormedical expenses not coveredthrough your health care plan.

Another product thatsimportant at this stage is longterm disability insurance.Disability insurance covers adisability caused by sickness or

an accident. It provides a monthlybenefit to replace your incomeif you are disabled and unable towork. Often people are covered

through their group insurance,but its important to fullyunderstand any limitations ofyour group coverage. Owningpersonal coverage may be a

good decision.Finally at this stage, term

insurance offers a cost-effective

way to provide your family withfinancial protection against anuntimely death.

ACT 2, SCENE 1

As you get older, your needs

change and your priority shiftsto protecting your assets. While

youre working, you will stillneed both critical illness anddisability insurance. But theolder you get, the less important

those risks become and themore important long termcare becomes.

You can think of long termcare insurance as a replacementfor long term disability insuranceduring your retirement. Itprovides money to help pay for

additional expenses when youcan no longer care for yourself.

This insurance provides amonthly benefit if you are unableto do two of the six activities of

daily living or if you suffer froma cognitive impairment. The

amount you receive is based onwhere you receive your care

you get a certain amount if yourcare is at home and more if yourcare is at a facility.

The very last piece added to

this framework is permanentinsurance. In your younger years,term insurance is the mostaffordable life insurance solution.Over time, as you move into

protecting and preserving yourestate, permanent insurancemakes more sense. It offers thelife insurance protection you

need, and some plans allow youto deposit more than the cost ofthe insurance. This extra moneybuilds up over time and is paidto your beneficiaries tax free.

THATS A WRAP!

It probably feels that your life

movie is rolling a little fasterthan youd like. Being prepared

for any scene is key to makingsure that the movie plays outaccording to your script. Becausewhen the final credits roll, youll

want people to sit back and sayNow that was a great movie!

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5Puzzlebywebsudoku.com

EXERCISE YOUR

BRAIN! SOLUTIONS(from page 38)

Medium

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Easy


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Living Benefits products are sold by, Manulife Financial (The ManufacturersLife Insurance Company). Manulife Financial and the block design are registered service marksand trademarks of The Manufacturers Life Insurance Company and are used by it and its affiliates includingManulife Financial Corporation.

When it comes to protecting you and your loved ones,

Manulifes got it covered.

Were the only company in Canada to offer you the

full range of Living Benefits products available today:

critical illness, disability, long term care, health & dental and

travel insurance.

And its all backed by Manulife Financial, one of the worlds

most experienced and professional insurance companies.

For more information, contact your advisor or visit

www.manulife.ca

Weve got it covered


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Is it timeto take theT R A I N I N G W H E E L

off your banking products?


29/40


his approachto banking is

complicated andexpensive. Whenwere young adults,

however, it sometimes makes

sense because:

Were relatively youngand still learning how tobudget effectively

Were just getting started inour careers and have a limitedcapacity to absorb unexpectedexpenses or cost increases

Our credit history is limited

so banks may be hesitant tooffer us more flexible orintegrated banking products

In summary, when were juststarting out, we need bankingproducts that provide us with

structure and cost-certainty. Inother words, we need bankingproducts with training wheels.

Whats surprising, however,

is that many of us continue to

maintain this inefficient andcomplex method of banking long

after weve become skilled atmanaging our money, establishedour careers and built a financialbuffer. By the time we enter our30s or 40s, most of us no longer

need multiple inefficient savingsaccounts or the cost-certaintyprovided by fixed debt payments.However, we continue to maintain

these accounts and lock in our debteach time it comes due simply outof habit or complacency.

Somewhere along the wayweforget to take the training wheels off.

Once weve progressed beyondyoung adulthood, we should beginto expect more from our bank. We

should expect our bank to help usbring our finances together, notsplit them into more and moreone-purpose products. We shouldexpect our bank to make it easy for

us to respond quickly to changingfinancial needs. And we shouldexpect our bank to offer us

products that make all of ourmoney work as efficiently as

possible. In short, we should expectour bank to treat us like adults.

Some banks in Canada havecaught on to this idea and startedoffering next-generation banking

products that allow you to combineyour various debts with yoursavings and chequing accountsand income in a single account

that makes your money workmore efficiently and providesgreater flexibility.

To understand why it makes

sense to review the way you bank,ask yourself these questions:

1WHAT WOULD MY BANK

SAY IF I DECIDED TO REDUCEOR SKIP A DEBT PAYMENT?

Our finances arent always aspredictable as wed like and thepayment amount that made sensesix months ago may not make

sense today. With many traditionalbanking products, changing your

When most of us are starting out as young adults, we look for banking products that

provide us with structure and stability. We choose loans with fixed, predictable

payments. We set aside savings in different accounts for specific purposes. We may even

have more than one chequing account, each with its own set of fees. In other words,

we have a banking product for each need and each need has its own banking product.

T


30/40


payment amount isnt an option.However, some next-generationbanking products allow you to

adjust your debt payments, upor down, as your needs change.

This can work for you in a coupleof ways:

Become debt-free sooner. Ifyour finances change for thebetter, you may choose toaccelerate your debt repaymentso you can be debt-free soonerand reduce the amount you

spend on interest costs.

Prepare for job loss. If your

finances take a turn for the

worse, the last thing you wantto do is worry about how youllcover a large, inflexible debt

payment. A more flexible bankingsolution could provide you withtime to find the job you want,rather than just one youneed.

2DO I HAVE A RAINY-DAYSAVINGS ACCOUNT?Most of us have been taught tokeep some money in a rainy-daysavings account three to six

months of income is commonlyrecommended. This seems likegood advice until you considerthat many of us also have debt

and were generally paying moreinterest on our debt than wereearning on our savings. Why dont

we use our savings to reduce ourdebt? Its because, in most cases,if we pay down our debt, well

lose access to our savings. As aresult, we end up paying more

interest than we should.Some new banking products

offer a much more efficient way

to use your money. Specifically,they allow you to use your savingsto reduce your debt and saveinterest, while still giving you

access to that money if you needit again in the future.

3AM I PAYING DIFFERENTINTEREST RATESON DIFFERENT DEBTS?

Most of us have several differentdebts at a variety of interest rates.This makes it difficult to keep trackof how much we owe and ends up

costing us much more thannecessary. The next generation ofbanking products allows you toconsolidate all of your debts at one

low rate. This could save youinterest and make it easier to stay

on top of your financial situation.

4 HOW MANYBANKING PRODUCTSDO I REALLY NEED?

Most of us end up with a differentbanking product for each needbecause thats what our bank has

offered us. Unfortunately, this

makes our banking morecomplicated than it needs to beand ends up costing us more than

it should through multiple feesand inefficient use of our money.

Your bank should make it easyfor you to manage your money andget out of debt more quickly. When

you combine your debts with yoursavings and chequing account,youll have fewer banking productsto manage and youll no longer

need to shuffle money back andforth among accounts. Better still,by addressing multiple needs witha single, efficient product, you

could reduce your banking fees

and make your money work harder.Have a look at the way youre

banking. If you have multiplesavings accounts, chequing

accounts and debts, your banking isprobably much more complicatedand expensive than it needs to be.The next generation of banking

products provides unprecedentedflexibility that allows you tosimplify your banking, make your

money work more efficiently andrespond quickly to your changingfinancial needs.

Your financial situation hasprobably changed a lot sinceyou were just starting out. It may

be time to take off the trainingwheels and start expecting morefrom your bank.

YOUR BANK SHOULD MAKE IT EASY

FOR YOU TO MANAGE YOUR MONEY

AND GET OUT OF DEBT MORE QUICKLY.


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Manulife One is offered through Manulife Bank of Canada. Manulife, Manulife One, the One logo and the block design are registered trademarks of TheManufacturers Life Insurance Company and are used by it and its affiliates including Manulife Bank of Canada. Used with permission.

Give yourself some financialflexibilityIn times of economic uncertainty, it pays to add some flexibility to your finances. Manulife One combines your

mortgage, loans, savings and income into an all-in-one chequing account. If your finances hit a bump in the road,you can access your home equity, up to your borrowing limit, to get you through the rough patch. And, during

normal times, this efficient account can help you save interest and accelerate your debt repayment.

To add some flexibility to your finances, ask your financial advisor for a referral.


32/40


ntil 2009, most

Canadians held theirretirement savingsin an RRSP, wherethey could claim a

deduction for their contributionsand then defer tax on withdrawalsuntil retirement. The introductionof TFSAs has provided anotherpowerful savings vehicle that allows

investment growth to accumulateand be withdrawn at any time tax-free. Unlike an RRSP, you cannotclaim a tax deduction for thecontributions you make to a TFSA.

On the plus side, if you need to

withdraw money from your TFSA,you have an opportunity to replacethat money because all TFSA

withdrawals are added back toyour unused contribution roomin the following year.

If you have children or

grandchildren, RESPs are anotherpopular option. The subscriber (or

contributor) makes contributions onbehalf of a beneficiary (the child).

The contributions are not deductibleor taxable on withdrawal. Thegrowth is tax-deferred until

withdrawal, at which time it canbe taxed in the beneficiarys handsif he or she enrolls in a qualifyingeducational program. Contributionsto a childs RESP qualify for the

Canada Education Savings Grant(CESG)1 and, if your familysincome is below certain thresholds,you may also qualify for the Canada

Learning Bond (CLB).

THE RETIREMENT

DILEMMA

If you are saving for retirement,then you may be torn between an

RRSP and a TFSA. Ideally, youwould maximize contributions toboth, but if thats not an optionhere are some thoughts to consider.

Whether the best choice is to

save in an RRSP or a TFSA dependson your savings needs, as well asyour current and expected futurefinancial situation and income level.

Generally, an RRSP is used forsaving for retirement, while aTFSA can be used for both savingfor retirement and other shorter-term purchases. Because TFSA

withdrawals are added back toyour available TFSA contributionroom in the following year, thereis very little downside to usingyour TFSA savings for mid-sized

to large purchases.

If you are in a low tax bracket,saving in a TFSA may be moreadvantageous than saving in an

RRSP since TFSA withdrawals haveno impact on federal income-testedbenefits and credits such as childtax benefits and Old Age Security.

On the other hand, RRSPs may be abetter option if your tax rate at the

U

RRSP? TFSA? RESP?When its time to decide which mix of savings vehicles is right for you, your options can

start looking like a hearty bowl of alphabet soup. There are Registered Retirement

Savings Plans (RRSPs), Tax-Free Savings Accounts (TFSAs) and Registered Education

Savings Plans (RESPs). Determining which savings plan, or combination of savings plans,

is best depends on your personal situation and your objectives.

TAX CORNER

1Contributions to an RESP for a child under the age of 18 qualify for the CESG, which pays 20 per cent of the annual contributions you

make, up to a maximum of $500 per year, per beneficiary (or a maximum of $1,000 if there is unused grant room from a previous

year), to a lifetime limit of $7,200. You may be entitled to an enhanced CESG if your familys income is below certain thresholds.


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RESP RRSP TFSA

Is there an annual

contribution limit?

No annual limit but a

$50,000 lifetime limit1Yes, it is based on

earned income

Yes, a $5,0002 annual

limit but there are

no earning requirements

Can I carry forward unused

contribution room?

Yes Yes Yes

Is there a monthly penaltyon excess contributions?

Yes, calculated at month-end Yes, calculated at month-end Yes, calculated on the highestexcess during the month3

Are my contributions

tax-deductible?

No Yes No

Is my investment growth

tax-deferred or tax-free?

Tax-deferred Tax-deferred Tax-free

Are taxes payable on withdrawals? Withdrawals are fully

taxable except for refund

of contributions4

Withdrawals are fully taxable Withdrawals are tax-free

except for growth after death

if no spouse/successor holder

Are withdrawals added to my

contribution room?

No No Yes, in the following year5

Do withdrawals have an impact on

income-tested benefits/credits?

Yes Yes No

What is the minimum age

to contribute?

None None Age 18

What is the maximum age

to contribute?

None At the end of the 71st year None

If I borrow to invest in thisaccount, can I deduct the interest?

No No No

Can I use assets in this account

as collateral for a loan?

No No Yes

time you contribute is higher thanit will be when you withdraw yoursavings. Youll benefit from a taxdeduction when you make your

contribution and withdrawals willbe taxed at your lower future rate.If the reverse is true, a TFSA can

provide better results.

EDUCATION

SAVINGS CHOICES

If you are saving for your childseducation, then you are probably

weighing the pros and cons of anRESP or a TFSA. For children underage 18, RESPs are the preferred

savings vehicle because of the CESG.For children over age 18, the CESGno longer applies so you may wantto help them start their own TFSAs.

If you want to maintain controlover the funds, then you couldsave for their education in your

own TFSA instead.

2Increases, rounded to the nearest $500, to the yearly contribution limit will be applied as warranted by the consumer price index for years after 2009. 3The Federal government has proposed

that any income attributable to deliberate overcontributions will be taxed at 100 per cent. 4Any withdrawals other than the refund of contributions will be fully taxable to either the beneficiary

(student), if he or she qualifies to receive the payment, or the subscriber (contributor). 5The Federal government has proposed that the withdrawal of amounts in respect of deliberate

overcontributions, prohibited investments, non-qualified investments, asset transfer transactions and income related to those amounts not create additional TFSA contribution room.


34/40


Caughtin theM I D D L E ?

STRATEGIES FOR THE SANDWICH GENERATION


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If youre in your 40s or 50s and caring for both your children and your parents, welcome

to the sandwich generation. About one-third of middle-aged Canadians are part of this

so-called sandwich generation and more are expected to join their ranks.1

FEELING TIME-CRUNCHED?STRESSED? SANDWICHED?

he juggling actisnt easy. When aU.S. study asked

1,400 social workersabout the sandwich

generation, they said most peoplein this demographic groupunderestimate the financial,

emotional and physical toll of

providing care for aging relatives.2

The good news is that thereare ways to manage sandwich

generation stress. The beststrategies are to know what toexpect, to prepare financiallyand to take care of yourself as

well as your loved ones.

STRATEGIES TO HELP

YOUR PARENTS

WHAT CAN YOU EXPECT?

As your parents get older, they mayneed a range of supportive services.Initially, you may need to do minorhome renovations for example,

installing ramps or additionalrailings to accommodate reducedmobility or physical disability. The

next step may be arranging homecare, which can include visits fromhealth professionals, help withbathing and dressing, meal

preparation and light housekeeping.For those over 65, 43 per cent will,at some point in their remainingyears, require long term care.3 Ifyour parents cant live in their own

home anymore, they may need tomove into a retirement residence or

long term care home.

T

IT USED UP ALL MY TIME AND CUT

INTO MY FINANCES. IT HAD A DRAINING

EFFECT ON ALL FAMILY MEMBERS.

SURVEY RESPONDENT WHO PROVIDED

CARE TO A FAMILY MEMBER.

1Source: Statistics Canada, Sandwich Generation expected to grow, 2004.2New York Academy of Medicine and National Association of Social Workers, Not Ready for Prime Time: The Needs of Sandwich

Generation Women, A National Survey of Social Workers, March 20, 2008, helpstartshere.org/2008SandwichGenerationRelease/

tabid/1016/language/en-US/Default.aspx.3Source:The Council on Aging of Ottawa, 2007.


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WHAT WILL IT COST?

Home care costs vary widely,depending on how much support

someone needs. A typical lowlevel of care scenario could costless than $1,000 monthly forweekday meals, meal supervision,

bathing and dressing. A high levelof care scenario could add up to

nearly $5,000 monthly for in-home meal preparation, personal

care, skilled nursing, laundry andhouse cleaning.

Long term care costs vary byprovince. As an example, inOntario, as of July 1, 2008, basic

accommodation cost $1,578.02monthly, while a semi-private roomcost $1,821.35 and a private room

cost $2,125.52. Retirement

residences may be an intermediatestep before someone needs thefull range of care offered in a longterm care home. The provincialaverage cost in Ontario for a

semi-private room is $1,527 to$4,774, or $1,600 to $7,750for a private room.4 See detailedhome care and long term care

cost breakdowns by province atwww.manulife.ca/Canada/ilc2.nsf/Public/lc_cost.

Its important to talk to your

parents to find out if they havethe financial resources to payfor supportive services. Severalproducts can help them prepare

for these costs including criticalillness insurance and long term care

insurance. In addition, developing

a sustainable retirement incomeplan by using Product Allocationcan help add peace of mind thatincome will last throughoutyour parents retirement years.

STRATEGIES TO HELP

YOUR CHILDREN

WHAT CAN YOU EXPECT?

When its time for your childrento head off to post-secondaryeducation, youll probably beproud and a little anxious about

your newly empty nest. Yourpocketbook will also feel the pinchas bills start arriving for tuition,textbooks and (if your children goaway to school) accommodation

and living expenses.

WHAT WILL IT COST?

The Canadian government estimatesthat full-time students paid

$14,500 to cover post-secondaryexpenses in the 20032004academic year or $58,000 to payfor a four-year program. Full-time

tuition alone can cost anywhere

WHAT IS PRODUCT ALLOCATION?

Product Allocation strategies involve finding the right combination of

annuities, products with Guaranteed Minimum Withdrawal Benefits

and products with systematic withdrawal plans to provide sustainable

income for life.

4Manulife Financial, Long Term Care in Ontario 2009, www.manulife.ca/Canada/ilc2.nsf/Public/lc_cost.


37/40


from $2,500 to $8,000, dependingon the CEGEP, trade school, collegeor university.5

Families can prepare to meet

these costs by saving in a RegisteredEducation Savings Plan (RESP)and/or a Tax-Free Savings Account

(TFSA). You may expect yourchildren to pitch in by workingsummers or part-time duringthe school year. Your childrenmay also be eligible for grants,

bursaries, scholarships and loansthat can help to offset costs. Makesure they always have some short-term savings on hand to coverunexpected expenses.

The Education Cost Calculatorat www.canlearn.ca (search for

Education cost calculator) canhelp you work out your childrens

likely post-secondary costs.

STRATEGIES TO HELP YOU

While youre helping your parentsand children, dont neglect yourown needs. After all, you have to

stay healthy and happy in order toprovide care. Here are some tips:

Delegate household duties

explain to family membersyou need them to help out

more while youre taking careof your parents, and considerhiring people to clean, rakeand shovel snow

Ramp down your work hours depending on your employer,

you may be able to arrange towork from home, take sometime off to care for a sick parent

or temporarily switch to part-time hours

Use community resources

your area may have volunteerswho provide companionshipto the elderly and can evenaccompany your parents to

medical appointments

Set aside time each day (it canbe as little as 15 minutes) to dosomething you enjoy forexample, go for a leisurely walk

in a local park or read a magazinefrom beginning to end in a cozycoffee shop

Schedule a weekly date nightwith your spouse so you

have time to reconnect,discuss stressful situationsand unwind together

By balancing your own needswith the needs of your parentsand children, youll be in a betterposition to give loved ones your

full attention and deliver the carethey require.

5Government of Canada, CanLearn website, accessed on August 31, 2009, www.canlearn.ca/eng/postsec/cost/index.shtml.

HOW TO CHOOSE A LONG TERM CARE HOME

Assess the basics, including cost, location, cleanliness, room and

bathroom quality, security for personal items and visiting hours

Observe staff interacting with residents to see if theyre warm,

caring and engaged

Find out how often residents can access health services such as

physiotherapy, occupational therapy and foot care

Collect sample menus and activity calendars and taste a meal or

join in an activity if you can

Ask residents and their families what they like and dont like

about the home

HOW TO CHOOSE A COLLEGE OR UNIVERSITY

Consider the type of program your child wants for example, a

structured program directed towards a specific career or a flexible

program that offers a general education

Decide with your child whether its more appropriate to stay at

home or attend a school in another city

Visit websites of colleges and universities for detailed program

information and admission requirements

Make a short list and, if possible, visit those schools to get a sense

of the academic atmosphere your child may even be able to sit

in on a few classes

Ask about grants, bursaries and scholarships, as well as part-time

job opportunities on campus or in the vicinity, if youre counting

on additional funds to pay for your childs education


38/40


Exercise your brain!Sudoku puzzles are a great daily workout for yourbrain. Theyre fun, challenging and addictive and

good for you too! Here are two Sudoku puzzles

one easy and one at a medium level of difficulty.

To solve: Enter digits from 1 to 9 in the blank spaces.

Every row, every column and every 3 x 3 square must

contain one of each digit. Try to do it without peeking,

but if you need help the solutions are on page 26.

Heres a hearty soup thats sure to warm you up

during the chilly winter months!

Chili Soup1 tablespoon (15 mL) extra-virgin olive oil

1 pound (500 g) lean ground beef

1 large onion, chopped

4 garlic cloves, minced

1 large green bell pepper, chopped

1 cups (375 mL) beef stock

2 (540 mL) cans stewed tomatoes with chili

seasonings (undrained), chopped

cup (50 mL) chopped, drained sun-dried

tomatoes (oil-packed)

2 bay leaves

1 (540 mL) can red kidney beans, drained and rinsed

1 (341 mL) can whole kernel corn, drained

Salt and pepper

Light sour cream

Sliced green onion

Grated cheddar cheese

In large heavy pot, heat oil over medium heat. Add

beef, onion and garlic; saut for 7 minutes, breaking

beef up with spoon and stirring frequently. Add bell

pepper; saut for 5 minutes or until beef is no longer

pink, and vegetables are tender. Drain off fat.

Add stock, stewed tomatoes, sun-dried tomatoes and

bay leaves to beef mixture; increase heat to medium-

high and bring to a boil. Reduce heat and simmer for

5 minutes. Add beans and corn; cook for 3 minutes or

until heated through. Discard bay leaves. Add salt and

pepper to taste. Top each serving with a dollop of sour

cream, and a sprinkling of green onion and cheese.

Tip: Substitute 2 (540 mL) cans tomatoes for the

2 (540 mL) cans stewed tomatoes. Add 2 tablespoons

(30 mL) chili powder and 1 teaspoon (5 mL) groundcumin just before adding bell pepper.

Makes 8 servings.

*This recipe is reprinted with permission from Ruth Phelan and Brenda Thompson

from the best soups cookbook, 2008.

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Your advisor can tailor a Tax-Free Savings Account (TFSA) to fit your familys financial needs, helping your

money work even harder for you. We offer a number of different TFSA investing options including mutual funds,

segregated fund contracts, Manulife Investments Guaranteed Interest Contracts (GICs), and Manulife Bank

Advantage Accounts and GICs. To learn more about TFSAs from Manulife, contact your advisor.

The same solution doesnt work for everyone.We can show you a TFSA thats right for you.

Advantage Accounts and GICs are offered through Manulife Bank of Canada. Manulife Investments is the brand name identifying the personal wealth managementlines of business offered by The Manufacturers Life Insurance Company (Manulife Financial) and its subsidiaries in Canada. Manulife and the block design areregistered service marks and trademarks of The Manufacturers Life Insurance Company and are used by it and its affiliates including Manulife Bank of Canada andManulife Financial Corporation.


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Were big on whats important.At Manulife Financial, we know helping you reachyour financial goals is whats really important.

Its that focus that has allowed Manulife to become

one of Canadas leading providers of wealth

management, group pensions and benefits, banking

and insurance solutions.

Stability As the countrys largest insurance company,

Manulife provides the stability of over 120 years as a

proud Canadian company with proven risk and wealth

management strategies.

Financial Strength With Cdn$437 billion* in

funds under management and diverse global holdings,

we hold some of the highest financial strength ratings

Global Presence With hundreds of investment

professionals in over 22 countries including the U.S.,

Asia and Europe, we offer expertise and insights into

markets around the world.

Innovation We are always at the leading edge with

new products to meet your changing needs.

When you put it all together, you can feel confident

choosing Manulife.For more information, speak with your advisor,

or visit www.manulife.ca

Stability

Innovation

Global Presence

Financial Strength

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