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Momentum Newsletter |
November 2008 Vol. 11 |
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In This Issue |
-
Shari's
Introduction
-
Disability Insurance
-
Networking 101
-
Pam's Real Estate Investment Corner
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Shari's Introduction |
November, hard to believe that there
is only 7 weeks to Christmas! Holy
cow, time is flying by. It seems the
older I get the faster it goes too!
Well the last few months have been
quite a ride in the investment world
to the likes we have never seen
before - bearing in mind , that is
what we said when the
last time... It is amazing to me how
it has become such a water cooler
topic of conversation - especially
with the attention the media is
giving it. The market has always
gone up and down, dramatic as it is
right now, now is the time that you
should stand back and really
reconnect with your goals and your
dreams. I find that people are
confused and not sure what to do
because there is so much advice and
"sky is falling" fear mongering from
the media and the likes. Why do they
do this? Because fear sells. You
need to stay focused on your own
financial situation and your
personal life goals.
I suggest your write down your
fears, concerns, and all the
conflicting information that you are
getting and talk to your advisor who
knows YOU and YOUR goals. Together
you decide on the best course for
your financial plans. Any way you
look at it, losing money is never an
enjoyable situation. Losing more
than you invested in the first place
is even less pleasant. That's why
the most important thing you can do
to maintain control is to continue
to focus on the smallest
denominator: income. What's the
impact on your current income? Where
can you replace lost income from?
What is the impact on your long-term
income? Do you have income
protection?
Have you noticed that people who
are good Networker's seem to
move around the room in a
graceful flow and rhythm? They
really make it look easy and
they even seem to enjoy it! Have
you talked yourself into
believing that you will never be
cut out to be a successful
networker? Do you believe that
networking is outdated and
unnecessary in a transparent
world of process, procedure and
technology? Well it is not! Some
of my friends call me the
network queen because I am
always out and about and getting
involved. It is has made a huge
difference in my business and so
I have included an article with
some networking tips for you.
Pam Moreside has some great tips
on real estate for you too, see
her article below.
Before I go, I lost a friend in
October - he was 47 years old -
same age as me, to cancer. We
got his affairs in order before
he died. Being able to help him
was once again confirmation to
me of why I do what I do. I was
able to make a difference to his
widow and help her get through
these tough times. That feeling
is priceless.
Please make sure that you have
current wills and you have
talked with your loved ones
about your finances, house
titles, bank accounts, to name a
few. Insurance can make a huge
difference when the last thing
you want to worry about is
finances. Godspeed Joe.....
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Disability Insurance |
Disability Insurance
can protect
finances
We buy
homeowner's
insurance in
case the roof
caves in, and
collision
insurance in
case the car
gets banged up.
But the money
machine that
pays for these
things often
goes uninsured,
or
under-insured.
That money
machine is your
ability to earn
income, and if
you are injured,
become ill or
disabled and are
unable to work;
the money
machine will
stop producing
cash.
How, and for how
much, you insure
yourself depends
on your earning
power, your
dependents and
other insurance
coverage you may
have through
your employer.
But most people
don't understand
the details of
their group
insurance plan.
They may not
realize until
it's too late
that the plan
falls short of
their specific
needs.
Group plans are
tailored to the
average person.
It may not be
adequate to meet
your particular
needs. The most
important part
of your group
disability plan
is sometimes
difficult to
find in all of
the paperwork.
It's the
definition of
disability. You
are only covered
if you are
disabled as
defined in the
policy. Because
different plans
define
disability in
different ways,
it is important
to have an
understanding of
what qualifies
as a disability
under your plan.
Two common
definitions in
policies are
"any occupation"
meaning if you
can do any work
you are judged
not to be
disabled, and
"regular
occupation"
whereby you are
judged to be
disabled if you
cannot do your
regular work.
Many plans are a
combination of
the two.
If you are a
chartered
accountant and
you were to lose
your short-term
memory, you
couldn't work as
a chartered
accountant, but
you might be
able to get a
job at
McDonald's. If
you didn't have
the right kind
of plan, your
disability
coverage might
not kick in
because you
 are
still able to
work.
Also, if you
change jobs, you
won't take that
group coverage
with you. If you
are counting on
a disability
plan to replace
your income, you
may need to get
a top-up policy.
The cost will
vary depending
on age, risk
level of your
job and the
amount of
coverage.
Premiums for an
oil rig worker
will be more
than for someone
who works in an
office.
Canada Pension
Plan has a
disability
component, but
it's often
harder to meet
the criteria...
severe and
prolonged...
Obtaining CPP
disability can
be more
difficult.
While disability
insurance is
designed to
replace regular
income, if
someone becomes
seriously ill,
there can be
other financial
demands that
exceed
day-to-day
expenses. These
could include
drugs or
treatments that
aren't covered
by provincial
medical plans,
treatment
outside of
Canada or home
modifications to
accommodate a
disability.
That's why
critical illness
insurance is
available to
protect you
against the
financial impact
of a diagnosis
of a critical
illness, such as
cancer, heart
attack or
stroke. Young
workers,
especially, may
find that in the
event of a
critical illness
they do not have
adequate
resources they
can liquidate in
order to deal
with the
situation.
Critical illness
coverage
provides funds -
in a tax free
lump-sum payment
- if you are
diagnosed and
survive a
specified
illness. The
money can be
used for any
purpose.
Nobody wants to
accept a
radically
reduced quality
of life in the
event they
become disabled.
Insuring your
income stream is
one way to
prevent that
from happening.
With the
unstable
economic times
we are faced
with right now,
it has never
been more
important.
It can happen
when you least
expect it. With
life insurance,
you're buying it
to protect
somebody else.
But with a
disability or
suffering a
critical
illness, you
will still be
around to live
with the
consequences.
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Networking 101 |
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Networking is the best
marketing device of even
the most cash-strapped
home-based entrepreneur.
It is based on an
inexpensive endeavor
using a simple skill:
talking. As a result,
networking is also
 referred
to as "word-of-mouth
marketing" because it is
based on talking to
people about what you do
and listening to find
out how to serve them.
The best networkers do
not even know that they
are networking - they
are simply being good
conversationalists;
adept at becoming
visible; talking and
responding, and getting
to know people.
However, many people are
put-off with the idea of
networking. Some view
the practice akin to
"politicking" requiring
an extremely outgoing
personality willing to
approach anyone who
would care to listen.
Many start-up
entrepreneurs also have
a hard time approaching
other people -
particularly strangers -
about their business. It
may be the fear of
speaking out to a total
stranger, or the fear of
coming on too strong or
aggressive. Others let
their insecurities take
the better or them,
while some people fail
to network simply
because of laziness. As
a result, many formal
gatherings and social
situations become lost
opportunities to spread
the word about their
business.
Everyone you meet is a
potential customer or a
valuable contact.
Marketing is simply
spreading the word
around, and it is a big
loss if you continuously
pass up opportunities
for networking.
 Schmoozing
pays. In fact, the
growth of any business
is directly correlated
to the number of people
who knows about it.
Doing more of networking
allows you to develop
more contacts in your
field and to exchange
information with your
prospects. It can help
you find out the
concerns of your
prospects and who is
fulfilling them; what's
happening in your
industry; and who needs
what and who offers
what. It is basically an
entrepreneur's tool for
relationship building.
Successful networking
entails harnessing your
people skills. But it
doesn't happen
overnight, particularly
for those who are not
natural social
butterflies. It requires
careful orchestration
and good manners, too.
Here are several steps
to help you become an
effective networker:
1.
Prepare a plan.
Networking goes
beyond greeting
people. You need to
prepare a
step-by-step plan
for how you'll build
relationships and
how you can
effectively tell
your story. It
entails getting to
know people who will
either do business
with you or can
introduce you to
people who will.
When people ask you
what you do, make
sure you have a
clever opening line
to introduce
yourself and your
business.
2.
Learn to communicate
more easily.To
be a good networker,
you need to work on
your ability to make
small talk. You need
to be able to
articulate what you
do in clear, easily
understandable, and
memorable way.
Imagine yourself in
a cocktail party or
industry luncheon
full of potential
prospects. Set a
goal of meeting at
least two people in
one event, slowly
increasing the
number as you become
more comfortable
with the art of
schmoozing. Once you
are at an event, do
not stand around
with appetizers in
hand waiting for
other people to
approach you. Go
out, head straight
to people you do not
know, and start a
conversation. You
will defeat the
purpose of
networking if you
continuously stick
with familiar faces.
Get interested in
what others are
offering or saying
without being
abrasive. Good
networkers are good
listeners, too.
3.
Identify your
prospects.
Know your most
likely market, and
learn where you will
find them. Research
as much as you can
from the ideal
prospects for your
business. How do
they get their
information? Do they
live nearby? What
activities do they
participate in? What
organizations do
they belong to? The
more you know about
your
 customers,
the easier you can
reach them.
4.
Start with people
you know.
Look at your roster
of friends,
colleagues,
acquaintances, and
people you have come
across in your
lifetime. From among
your friends,
identify whom you
think might be able
to help you the
most.
5.
Get involved.
A key to successful
networking is to get
involved.
Participate in
organizations,
events, professional
groups and social
clubs that offer
opportunities for
you to meet and
greet. Participate
in numerous
networking groups,
join your chamber of
commerce, and attend
conferences and
training seminars.
With the advent of
the Internet, you
can also network in
online newsgroups
and discussion
boards. The key is
to list every
opportunity to
network and develop
win-win
relationships with
your contacts.
6.
Make networking a
part of you.
Make it a point to
meet new people
wherever you go -
whether you are on
the plane, waiting
in line at the bank,
or fetching your
child from school.
Be generous in
giving away your
business cards (and
bring lots!
...drives me crazy
how many times I go
to networking
functions and
someone does not
have cards! Be
prepared!)
An established
business has the
luxury of satisfied
customers spreading
the word about the
business. Until your
business is
self-sustaining, you
need to start
opening your mouth,
spreading the word
about your venture
to all your friends,
relatives,
acquaintances, then
later on, even
strangers.
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Pam's Corner |
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Changing Markets -
For Better or Worse
In Shari's last two
Special Reports she
talked about the
fear abounding with
the changing real
state market in the
US and Canada, the
sub prime crisis and
the resulting market
meltdown. It is a
scary time for many
- especially those
who have suffered a
substantial loss on
their retirement
investments. It is
hard to be
optimistic at a time
like this when the
media bombards us
with tales of doom
and gloom but as
Shari said: history
always repeats
itself and history
shows that directly
following a major
market change is a
turnaround where
very substantial
gains can be made.
It is during the
"crisis" time that
smart investors get
positioned for what
is to follow.
Market corrections
are normal in all
investment areas and
Real Estate is no
different. Even in
an upward market
where the
fundamentals are
strong (and I still
feel Nanaimo and
many other towns on
Vancouver Island
fall into this
category) it is not
a straight line
upwards. There are
plateaus and dips
along the way as the
market continues to
climb.
 There
has been a lot of
concern in Nanaimo
about the recent
market changes and
just like the big
sub prime crisis and
all the reports of
disaster for all, it
has been vastly
over-hyped. Yes,
prices have taken a
dip. A very small
dip. Last month the
average sale price
of a Single Family
Home in Nanaimo went
down by 2% from last
year. BUT - that is
the only month in
2008 that they have
gone down - every
other month the
price of a Nanaimo
home has risen by 4%
to 16% for a yearly
average to date of
10% increase.
And if you remember
back to the first
article I wrote in
the May newsletter,
real estate is a
lucrative and
quickly appreciating
vehicle because of
leverage. So if your
home, or investment
property (only) goes
up by 10% this year
and it is leveraged
by 75% (25% your
money and 75% the
banks) you still
made over a 38%
increase on an
average priced home!
Even if prices
continue to go down
and the end of the
year does see a
smaller appreciation
number like 4% or 5%
remember leverage
AND that real estate
like most smart
investing is a long
term investment.
Now in all markets
there are cycles.
There is always a
time to buy and a
time to sell. We've
been in a strong
sellers market for
the past few years.
When the market
begins to slow and
turns from a sellers
market to a buyers
market it is the
perfect time for
investors to add to
their portfolio. The
prices in Nanaimo
were getting too
high to find
properties that
would generate
positive income but
I am seeing more and
more opportunities
to purchase decent
properties that cash
flow nicely right
now. Because the
market is slower the
savvy buyer has more
time to do their due
diligence, shop
around and not get
swept away by
emotions and the
pressures of an
overly active
market. This is an
excellent time to
buy and get
positioned for the
next upswing.
 If
you are a homeowner
or investor that
absolutely must sell
a property then
effective marketing
will be crucial.
This is not the time
to test the market
with an inflated
price because that
is what the
neighbour got back
in May. Sharp
pricing and proper
presentation are
essential now. Have
it professionally
staged, do a
pre-inspection and
have all the minor
repairs done and
listen to your
realtor when they
suggest a price. If
you can; wait until
the spring. That is
usually considered a
better time to sell
anyway and some of
the fear that is
driving this
downturn may have
settled somewhat by
then.
The market will pick
up again. History
DOES repeat itself.
And preparing now
can make you a lot
of money down the
road.
When the markets
give you lemons,
make lemonade.
Pam Moreside
Stats from:
Vancouver Island
Real Estate Board.
MLS Statistics
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