Tag Archives: Karin Mizgala

6 things to consider before investing in a rental property

By Karin Mizgala, co-founder and CEO Money Coaches Canada and the Women’s Financial Learning Centre

Holding house keys on house shaped keychain in front of a new home

The average Canadian house price hit $508,567 in March however that number is skewed by the incredibly hot real estate markets in Vancouver and Toronto. If you remove those markets from the equation the average home cost drops to $366,950. But even that lower number represents an increase of 15% in the average sales price over the last year, and coupled with low interest rates, real estate has certainly been a financially attractive investment recently.

However, there are things to consider when contemplating investing in a rental property, as I explained in a recent Globe and Mail Q&A article. Continue reading →

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Three reasons to stick with a defined benefit pension plan

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By Karin Mizgala, co-founder and CEO Women’s Financial Learning Centre and Money Coaches Canada

Retirement planning can raise a lot of questions and feel overwhelming to many Canadians, so I was very pleased when The Globe and Mail newspaper asked me to be one of the go-to experts for their Retirement Q&A section.

Here is my most recent contribution.

globe and mail

pensionQuestion from Derrick Alstein, Port Elgin, age 60:

I have a number of friends and a relative who are considering cashing in a defined benefit pension plan. I think an article on the pros and cons of a cash out strategy versus taking normal payments would be informative. Many people I know that have cashed out are taking advice from people that want to invest their money, have not done well and have had to go back to work.

Answer:

While the lump sum offered to people who consider cashing out their defined benefit pension can be very tempting, I rarely advise clients to withdraw from their pension and invest the proceeds with a financial adviser. Here’s why:

1. Ease of Management

With a defined benefit pension, your employer hires an investment company to manage the pension assets and is responsible to ensure that employees receive the monthly Feb 3 tweetpayment they are entitled to based on a formula that considers earnings history, years of service and age. You have no direct involvement in the management of the investments and there is no need for you to make any investment decisions before or after retirement. At retirement you receive a regular monthly payment from your employer for life. Simple. Most people who want to weigh the pros and cons of a lump sum withdrawal turn to their financial advisers for advice. Of the almost 100,000 financial advisers in Canada, 99% have a vested interest in directly or indirectly managing your investments. I’m not saying that it’s impossible for advisers to provide unbiased advice on whether to stay with the pension or not, but when the potential investment dollars are significant, let’s face it, it’s not easy to remain impartial. To avoid any potential conflicts of interest, it is best to consult an accountant, actuary or fee-for-service financial planner on pension decisions.

Read points 2 & 3 on the Globe and Mail website

 

 

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5 Tips for Surviving Economic Uncertainty

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By Karin Mizgala, co-founder and CEO Women’s Financial Learning Centre and Money Coaches Canada

It has been a tumultuous start to the year for the stock market and for the various governments trying to keep the world’s economies on the straight and narrow.  For the ordinary person it’s confusing and worrying.

calculator-385506_1280But what we have to remember is that markets always have their ups and downs.  Easier said than done I know, but it’s best not to succumb to emotion or panic selling.

It’s now especially important to take a longer view of investments. If you weren’t planning to cash in all your stocks or mutual funds now, it’s no time to panic and change those plans. Markets move in cycles and this is unlikely to be any exception. There are even some investors, quick to see a silver lining, who are snapping up stocks at these lower prices.

There are things that you can do to cope and we’ve compiled our top five tips to reduce stress during economic uncertainty.

1. Focus on the things you can control — like living within your means and paying down debt

Take interest rates for example. There’s little you can do about them except make sure you’re prepared for whatever may come. If you’ve racked up credit card debt, make a workable plan to pay it off and cut up your credit cards or at least put them in deep freeze. Use cash for your discretionary expenses like eating out and entertainment. Figure out what you spend on those and other frills and take that cash out at the beginning of the week. Once it’s gone, it’s gone — no going back to the ATM before next week’s installment of ‘fun money.’ Continue reading →

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Money Coaches in Conversation – What you should understand about fees and financial advice

Recently Women’s Financial Learning Centre and Money Coaches Canada co-founder Karin Mizgala sat down with Money Coach Noel D’Souza to discuss the changing landscape of financial advice in Canada.

Women's Financial Learning Centre and Money Coaches Canada co-founder Karin Mizgala

MCC & WFLC co-founder Karin Mizgala

Karin: As someone in the financial industry, it’s very common to be asked by people outside the industry, to explain the different fee structures of financial advice. So, Noel, let’s start with an overview of the common compensation models available to Canadians today.

Noel: The most prevalent model we see in the industry is the commission-based advice model, where an advisor sells products, typically mutual funds or some other investment product, they may also sell insurance, and they receive a sales commission for making the sale and also quite likely receive a trailing commission which is supposed to cover on-going advice and services. Usually the client never sees the commission fees, and we’ll be discussing how that may change in the future, but usually those fees are hidden within the cost structure of the product they are buying.

The second type is fee-based. An advisor will charge the client fees based on the size of the assets under management, a percentage of the total portfolio.

The third model, which is up and coming, is the model we work under; fee-for-service. Clients pay a fee directly and explicitly to the advisor for services rendered and it’s not tied to product sales, or size of assets, in any way.

Karin: So that will sound pretty straight forward to most people, why does it become murky, what are the implications for someone seeking financial advice? What are the benefits and shortcomings of each model? Continue reading →

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Success Story: Robin and James – from knowledge to action

Note: The couple’s names have been changed for privacy.

Debt ball and chain openedRobin and James were young professionals in their 30’s when they contacted Money Coach Kathryn Mandelcorn. They were frustrated because they made a combined income over $150,000 but they had $45,000 in consumer debt and felt they weren’t adequately saving for their future. They didn’t see how they could pay off the debt and invest for retirement, without sacrificing their dream to buy a home and invest in further education. They felt like travel and other leisure activities were completely off the table if they were to have any hope of turning things around.

“When I met Robin ad James, I could see they were a very savvy couple,” says Kathryn. “They knew a lot about investing, they had a good idea of what they should be doing, but they were going in circles financially. They were paying down debt then going right back in. There was a big disconnect between knowledge and implementation.” Continue reading →

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The money goal that’s often neglected

By Alison Stafford, FPSC Level 1TM Certificant in Financial Planning

Information Definition Magnifier Showing Knowledge Data And FactsAt this time of year lots of people set goals, and it’s certainly not unusual for one of those goals to be about money. This year I’m going to pay down my credit debt, or this year I am going to spend less on dining out and save for a trip, or, I’m going to put more into my retirement savings. All worthy goals. But there is another money goal that is often neglected, one that would reduce the need for goals that “fix” our past behavior with promises to make better choices this year. That better money goal is: This year I’m going to focus on my financial knowledge.

The more we understand the mechanics of money, the more engaged we are with our finances, the more likely we are to make good choices every day, not just for the first few weeks of the New Year. So what holds people back? Continue reading →

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7 Stages of Financial Well-Being™ – Where do you stand?

By Karin Mizgala, BA Psyc, MBA, CFP®

Whether you believe in New Year’s resolutions or not, doing better with money in the coming year is probably on your mind.  Why is it such a popular resolution, yet so hard to keep?

One of the biggest reasons is not having a clear sense of what financial success means to you.  The other reason is that it’s just not easy to do what it takes to be good with money in the complex and busy culture we live in.

It takes less effort to hope that a windfall will suddenly appear or to just stay stuck in financial inertia, but wouldn’t it be nice to finally feel in control of your money once and for all –  on your own terms? Continue reading →

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Money, Happiness and Our Vision for 2015

The end of a year is often a time for reflection. What are we thankful for? What challenges did we face last year? What do we want from the coming year for ourselves, our family and our community? Often the short answer is that we want to be happy. We want those we love to be happy. A simple, common word that can be hard to explain, because while Webster’s dictionary may define it as ‘having, displaying, or marked by pleasure or joy,” ultimately we must each define how we achieve happiness for ourselves.

When we founded the Women’s Financial Learning Centre (WFLC) and Money Coaches Canada (MCC), our vision was, and still is, to help Canadians do much more than pay down debt and plan for retirement. We want our clients to achieve a level of financial well-being and contentment they never thought possible. Continue reading →

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Cracking your personal money code – the psychology of money

By Karin Mizgala, BA Psyc, MBA, CFP® 

Prescriptive advice is the staple of magazines and blogs. It’s often presented in easy to read lists with catchy headlines like: How to…. 3 ways to… 7 habits of…. We’ve all seen the format, we even use it here on this blog. It’s a popular style because it gets right to the point with actionable steps to make changes in everything from your health, your parenting, and of course your finances.

So why aren’t we all healthy, wealthy, fantastic parents? Well, some people are. But many others find that somewhere between information and action, something disconnects. It’s that space between that motivates Vancouver psychologist turned financial advisor, Tracy Theemes, to explore the psychology of money, especially as it pertains to women. Continue reading →

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Six steps to begin your career change

By Karin Mizgala MBA, CFP

iStock_000037313958SmallThere is a popular expression, that’s actually the title of a book published in the 1980’s, “Do what you love and the money will follow.”  But my experience as a financial planner and money coach tells a different story.  The people who are most successful following their bliss are the ones who don’t just assume the money will follow, they take charge and make a plan. These six steps are a great way to start.

Step 1: Evaluate. Look at this career change decision as an opportunity to evaluate your mindset around money. Examine your limiting thoughts, and be determined to believe in yourself and your ability to take charge.

Step 2: Take stock.  With a positive attitude in place, take stock of your assets, savings and debt level. You can use this Net Worth Statement to get started. If your debt is high, (especially credit card debt) you will want to work on lowering that debt before you make changes. But don’t let debt stop you, let it take you to step 3. Continue reading →

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