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Should You Renew or Cash in Your GIC?

bigstock-Green-Wheel-Barrel-Full-Of-Dol-5607013A GIC is a funding vehicle used to earn money on the principle invested with a guaranteed rate of return for a set period of time and many people appreciate the safety of investing their money in Guaranteed Investment Certificates (GIC). Now, if you invested your money into a GIC say five years ago, you may have been earning a 7% rate of return on your principle.  This looks wonderful compared to the current guaranteed interest rate of 1.5% to 2.0 % or so. Is now a good time to renew or cash in your GIC?

Although the principal amount invested is guaranteed, the interest earned on a GIC is taxable as income.  If the investor has a marginal tax rate of 22% then the real return on the GIC is lower than the original 7% guaranteed over the term of the GIC.  The realized rate of return is just under 5.5%.  And in the current GIC market the guaranteed rate of return is much lower than 7% and is hovering around 1.5 to 2.0%

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Dispelling the Myths about Funeral Preplanning – Part 1

A Coffee a Day is a Funeral Prepaid

iStock_000023619424XSmallReally?  Absolutely!  It can cost as little as $50.00 per month or even less to prepay your final funeral arrangements.  The couple I worked with this past weekend started their prepaid funeral arrangements for under $25.00 per month.  We worked within their budget and what they wanted to fund first and that is how the contract was set up.  We will add different items into the prepaid funeral contract over time and they will eventually have their entire funeral pre-funded within a budget that is comfortable to them. In this blog series, we will dispel some of the myths about funeral pre-planning.

Unfortunately, many people are under the impression that funerals are expensive or that they have to prepay funeral arrangements in one lump sum.  This is not the case. The average funeral cost in Ontario is around $8,800.00, and I have organized funerals that were $2,000 to over $15,000.00.  It really does depend on what you want to set up ahead of time and how you want your life to be celebrated.  People often ask me about the cost of a funeral, and that can depend for example on the casket selected.  Caskets are usually made of wood, metal or cloth covered particleboard.  The entry level pricing for a casket is around $600.00 and can go as high as you wish.

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