Momentum - Volume 1

Volume 2, Issue 3 April 2007

In this issue


Shari's Opener Leave Your Money to Compound Investment Jokes Disability Planning - A Reality Checklist Score Your Financial Situation	Breast Cancer Myths Antiperspirants Do Not Cause Breast Cancer The Importance of Having a Will Power of Attorney

Shari's Opener

Well – I am in my new office downtown on Commercial St.! (in the Vision Arts/old TD bank building)

Very excited to be downtown – the energy is amazing – you can feel the growth that is happening, please stop in and say hello if you happen to be here!

New phone numbers and address – see below.

Well the momentum is sure going for me right now – new location and meeting a lot of new people.

Like I have said before I truly believe that once we get momentum in our lives, it enables us to be confident and realize our potential for unlimited possibilities! Each of us has dreams and aspirations. With even a small commitment they can be realized. My vision is to educate people about investments and insurance and help them achieve their goals and live the things that they have passion for. Each of us is unique and I work on that principle to build individualized plans that work for you!

The Diva Club met on Wednesday April 11. We were at Tania’s Downtown for this meeting - and if you have not tried their Tapa's - you need to! Very good favourite was the popcorn shrimp Thanks Tom for making us feel very welcome. My special guest was Jocelyn Duncan, Regional VP of Manulife Investments here on the Island. Jocelyn gave us information on Manulife Investments most recent product innovation to date. It is unlike any other product currently offered in Canada and promises to change traditional retirement thinking within the industry! It offers predictable, sustainable and potentially increasing income! I know sounds too good to be true – but it may be a fit for your retirement plans.

I have included a few articles this month on subjects that I have been dealing with lately.

I would love to have your feedback on any of these subjects, and any suggestions for future issues are welcome and appreciated.

I hope to see you soon!

Enjoy and live life on purpose!

Tel: (250) 755-4004
Fax: (250)755-4006
Address: 140 Commercial St, Nanaimo, BC V9R 5G6

Leave Your Money to Compound

Leave Your Money to Compound Obviously, to have a successful investment work for you, you must let it grow. Investments grow by compounding – earning interest on the interest (so to speak). So, you must leave the return or profit that is generated by your investments there to work for you by compounding.

Have a look at how dramatic compound interest can be.

Look at the chart below and see how dramatic compound interest can be. It shows you how much you would have to save on a monthly basis, at 12% return, to have a million dollars by the time you are 65 years old.

Take particular note of how small a required monthly contribution is if you start when you are young. Maybe you don’t have 30 or 40 years left to invest, but maybe you have children that you can teach this to who do have that time. Print this off and show it to them when the time is right. Maybe they can benefit from knowledge that many people wish they had years ago. Including myself!

How much money would you have to save monthly to accumulate $1,000,000,000 by the age of 65 assuming earning 12% return)?

If you had a child born today, how much would you have to put in an investment just once, the day s/he was born, assuming an average of 15% return per year, so that on his/her 65th birthday s/he would have a million dollars? In other words, what amount would it take, just one deposit, to compound into a million dollars in 65 years at 15% return?

One Time Deposit Required To Accumulate $1,000,000
In 65 Years Assuming 15% Return
$113.41

Be careful not to confuse long-term investing with accumulating money. If you are saving for a down payment on a house – that’s accumulating money, and should be invested with a very different strategy. Money being accumulated for Christmas, for vacations, or any other short-term purpose is not the same as long-term investing. Long-term investing goals should have at least 5 years, and preferably 10 years or more. The further away your horizon, the more risk, or up and down movement, you can safely consider, and the greater potential you can expect.

Investment Jokes

Disability planning - a reality checklist

Self-employed Canadians
Nearly 2.3 million Canadians, or almost 17 per cent of the total workforce, are now self-employed, and that number is growing rapidly. Provincial workers' compensation programs or the federal employment insurance program provide basic disability coverage. However, these plans provide limited coverage, with relatively low benefits. Most self-employed people need additional income protection insurance. Older self-employed persons may find it difficult and expensive to obtain individual disability insurance. It's obviously better to buy such a policy when you are younger.

When you own your own business, you don’t have the security of group insurance that you may or may not have for your employees. After several years, you may find that you are drawing a substantial income from a successful venture.

If you become disabled, will your business continue to generate the same profits? If not, how will you meet your financial obligations? When we are independent-minded, we tend to be optimistic, to the degree that we might believe one of the following myths.

Myth #1. I will borrow the money until I get well
The Reality: Few people will lend money to a disabled person. It’s hard enough to borrow money when you’re in perfect health with a steady income.

Myth #2. I will live off my savings.
The Reality: How long would your savings last? Using up your savings at an age when you ought to add to your investments will likely ruin your retirement plans.

Myth #3. I will sell off some or all of my business assets.
The Reality: How many assets does your business own that are not required for its successful operation? Who will pay fair market value to one perceived as liquidating out of a dire need for cash?

Myth #4. My business will pay me a salary.
The Reality: Your partners may need to hire someone to fulfill your responsibilities. Flip the perspective around. If your partner became disabled, how long could you keep paying him or her, a salary in addition to the salary for the replacement? If you are a sole proprietor, and disabled to the degree you cannot work, how could you hire and train someone to work hard enough to produce his own salary and yours?

A personalized plan can be put together to meet your needs. Disability strikes far more frequently than premature death. Temporary or long-term disability can happen at any age. It can come suddenly from an accident, or severe mental or physical illness, or develop over time. A third of all people now aged 35 will be unable to work for at least six months before reaching age 65.

Disability facts….

Disability income insurance can cover you in the event of a severe accident or illness but, it really depends on how much disability income insurance you purchase as to whether or not it will be able to meet all of your financial needs. The greatest numbers of families have no form of disability income insurance.

Short term disability income insurance covers the first few months you are disabled and the benefits of short-term disability income insurance are many. Short term disability income insurance is a temporary relief though. If your condition prevents you from working for more than the covered period, then you will need to rely on long term disability income insurance.

Disability insurance can be purchased up to a certain percentage of your income and is tax free if you pay for it yourself.

Disability insurance does not mean you have to take the maximum but you would be wise to take sufficient to cover your monthly bills, even if you give up covering some items.

Disability insurance is sometimes hard to think about. Some people believe that if they make a Will that it will bring them faster to their Maker. Ditto for disability; take a policy and get disabled. But of course it doesn't work that way.

And the worst thing to do is to consider taking a policy and then becoming disabled before getting a policy in force. Disability insurance quotes will give you firm premium figures for various amounts of income and then you can make up your mind what to do. Even if you take a disability insurance policy with the longest waiting period, it will start paying when you really, really need it.

Disability insurance cost should be considered as a percentage of your income. If you earn $60,000 a year is 2% or 3% of that too high a cost to ensure that your net income will continue? Only you can answer that.

Score your financial situation

Click here for a downloadable version (PDF)

Breast Cancer Myths

I want to share with you the following myths about breast cancer – My aunt who has had both breasts removed – 5 years apart…. has just been diagnosed with cancer now in her lungs. I believe it is important to share these important words with you. If it makes a difference to be aware to have early detection – it may save your life.

What is your risk of breast cancer? Which breast cancer treatment is right for you? What about antiperspirants and breast cancer?

What you don't know CAN hurt you. Misinformation can keep you from recognizing and minimizing your own risk of breast cancer or getting the very best possible care. Arm yourself with the facts.

Here are ten common myths about breast cancer, followed by myths about specific types of breast cancer treatment.

1. Breast cancer only affects older women.

No.

While it's true that the risk of breast cancer increases as we grow older, breast cancer can occur at any age. From birth to age 39, one woman in 231 will get breast cancer (<0.5% risk); from age 40–59, the chance is one in 25 (4% risk); from age 60–79, the chance is one in 15 (nearly 7%). Assuming you live to age 90, the chance of getting breast cancer over the course of an entire lifetime is one in 7, with an overall lifetime risk of 14.3%.

2. If you have a risk factor for breast cancer, you're likely to get the disease.

No.

Getting breast cancer is not a certainty, even if you have one of the stronger risk factors, like a breast cancer gene abnormality. Of women with an inherited genetic abnormality, 40–80% will develop breast cancer over their lifetime; 20–60% won't. All other risk factors are associated with a much lower probability of being diagnosed with breast cancer.

3. If breast cancer doesn't run in your family, you won't get it.

No.

Every woman has some risk of breast cancer. About 80% of women who get breast cancer have no known family history of the disease. Increasing age – just the wear and tear of living – is the biggest single risk factor for breast cancer. For those women who do have a family history of breast cancer, your risk may be elevated a little, a lot, or not at all. If you are concerned, discuss your family history with your physician or a genetic counselor. You may be worrying needlessly.

4. Only your mother's family history of breast cancer can affect your risk.

No.

A history of breast cancer in your mother's OR your father's family will influence your risk equally. That's because half of your genes come from your mother, half from your father. But a man with a breast cancer gene abnormality is less likely to develop breast cancer than a woman with a similar gene. So, if you want to learn more about your father's family history, you have to look mainly at the women on your father's side, not just the men.

5. Using antiperspirants causes breast cancer.

No.

There is no evidence that the active ingredient in antiperspirants or reducing perspiration from the underarm area, influences breast cancer risk. The supposed link between breast cancer and antiperspirants is based on misinformation about anatomy and a misunderstanding of breast cancer.

See separate article

6. Birth control pills cause breast cancer.

No.

Modern day birth control pills contain a low dose of the hormones estrogen and progesterone. They have not been associated with an increased risk of breast cancer. The higher-dose contraceptive pills used in the past were associated with a small increased risk, in only a few studies. Today's birth control pills can provide some protection against ovarian cancer.

7. Eating high-fat foods causes breast cancer.

No.

Several large studies have not been able to demonstrate a clear connection between eating high-fat foods and a higher risk of breast cancer. Ongoing studies are attempting to clarify this issue further. We can say that avoidance of high-fat foods is a healthy choice for other reasons: to lower the "bad" cholesterol (low-density lipoproteins), increase the "good" cholesterol (high-density lipoproteins); to make more room your diet for healthier foods, and to help you control your weight. Excess body weight, IS a risk factor for breast cancer, because the extra fat increases the production of estrogen outside the ovaries and adds to the overall level of estrogen in the body. If you are already overweight, or have a tendency to gain weight easily, avoiding high-fat foods is a good idea.

8. A monthly breast self-exam is the best way to diagnose breast cancer.

No.

High quality, film-screen mammography is the most reliable way to find breast cancer as early as possible, when it is most curable. By the time a breast cancer can be felt, it is usually bigger than the average size of a cancer first found on mammography. Breast examination by you or your healthcare provider is still very important. About 25% of breast cancers are found only on breast examination (not on the mammogram), about 35% are found on mammography alone, and 40% are found by both physical exam and mammography. Keep both bases covered.

9. I'm at high risk for breast cancer and there's nothing I can do about it.

No.

There are several effective ways to reduce—but not eliminate—the risk of breast cancer in women at high risk. Options include lifestyle changes (minimize alcohol consumption, stop smoking, exercise regularly), medication (tamoxifen, also called Nolvadex); and in cases of very high risk, surgery may be offered (prophylactic mastectomies, and for some women, prophylactic ovary removal). Be sure that you have consulted with a physician or genetic counselor before you make assumptions about your level of risk.

10. A breast cancer diagnosis is an automatic death sentence.

No.

Fully 80% of women diagnosed with breast cancer have no signs of metastases (no cancer has spread beyond the breast and nearby lymph nodes). Furthermore, 80% of these women live at least five years, most longer, and many live much longer. Even women with signs of cancer metastases can live a long time. Plus promising treatment breakthroughs are becoming available each day.

Please share these facts with women that are important to you.

Antiperspirants do not cause breast cancer

Background

The following e-mail about antiperspirants and breast cancer has made the rounds on the Internet, and I would like to share with you the comments made from the breast cancer organization. The e-mail, which claims that "The leading cause of breast cancer is the use of antiperspirants," has alarmed countless women around the world—unnecessarily. Here is the e-mail and below is the comments from the breast cancer organization.

New information about antiperspirants and breast cancer

Intriguing as it is to consider whether antiperspirants and breast cancer are linked—after all, the armpit and the breast ARE next-door neighbors, and the start of antiperspirant use DID precede the subsequent rise in breast cancer incidence—there are no studies that prove any connection. While we'd all like to identify THE single cause of breast cancer so that we could all avoid getting the disease, antiperspirants are simply not a cause of breast cancer.

Here are some reasons why the myth about antiperspirants doesn't make sense:

There are plenty of other areas where you can still sweat: your scalp, your face, the front of your neck and down along the cleavage, down your back, in your groin area, and behind the knees (think about your all-over sweat "sprinkler system" during a hot flash!).
Why would antiperspirants affect only breast cancer risk? It doesn't increase the risk of skin cancer in the armpit, even though antiperspirant concentration is highest there. If antiperspirant is absorbed through the skin and stored in the armpit lymph nodes, then why isn't there a higher rate of lymph node cancer?
Even if the antiperspirant were concentrated in the armpit lymph nodes, the lymphatic fluid would not drain away to the breast. The direction of lymphatic fluid flow starts in the breast, and drains out through the armpit lymph nodes, toward the neck, and back into circulation. Additionally, there are one-way valves along the lymphatic drainage channels that keep the fluid moving in one direction (AWAY from the breast, not TO the breast).
It's not true that "nearly all breast cancers" occur in the upper outer aspect of the breast, the part closest to the armpit. Rather, 40–50% of all breast cancers occur in that region, in part because more breast tissue naturally "lives" in this area, compared to the three other quadrants of the breast: upper inner, lower outer, and lower inner.

Why is this important?

Don't assume that what you read is necessarily true. You have to be a careful reader as you plow through the enormous amount of information out there. Whenever you read something that makes a big scary claim or concerns you, analyze it critically, and ask your trusted healthcare professional for his or her perspective. You can also express your concern to us at www.breastcancer.org and we can offer you our opinion.

The importance of having a Will

Al and Barb thought they didn’t need wills. They were in their early 50’s and in good health. They held all their possessions in joint tenancy, so when one died the survivor would get everything.

But they died in a common accident, Al living for two days in a coma after the car crash that killed Barb.

Al and Barb had no children and so Al’s widowed mother, who lived in their basement suite and suffered from Alzheimer’s disease inherited everything.

Perhaps this is what Al and Barb would have wanted, but the odds are it wasn’t.

Many people are under the mistaken impression that if you die without a will “the government gets is all”. The government does not “get it all” but the Estate Administration Act does determine how your estate is distributed. By not having a will, a person loses control over who gets how much of your estate, and when. And they also give up the right to appoint a guardian of their choice for any you children they may have.

If you die without a will, the Estate Administration Act sets out the following rules as to how your estate will be divided:

1. If you own a home, your spouse will have the right to use it for life. This is called a “life interest” and can tie up the estate for a long time. Your spouse also gets the first $65,000 of your estate and then, if you have children, the balance of the estate is divided equally between your spouse and each of your children.

2. If you don’t have a spouse, or your spouse is dead, the estate goes to your children. If any of your children died before you leaving their own children, then their children would take equally the share of your dead children.

3. If you have no children or grandchildren, then your parents (or the survivor of them) get the estate. (which is how Al’s widowed mother inherited Al and Barb’s estate).

4. If your parents are dead, then the estate goes to your siblings, but if one of them has died before you and left any children living when you died, those children get your dead sibling’s share.

5. If you have no siblings, or they are all dead, the Estate Administration Act distributes your estate based on a table of family connections that shows how they are related to you.

If you die without a will, The Public Guardian and Trustee hold your child’s shares in trust for them until they are 19 years of age. The child’s parent or guardian then has to apply to the Public Guardian and Trustee for any money needed for things like living expenses or education.

Many people feel that theirs will be a “simple will”. Unfortunately, many of these people fail to consider what should happen in the event of a common disaster:

• who will be the guardian of the children if both they and their spouse die in a common accident?

• who will be the executor of their estate? who will be the executor of the estate if the original executor dies before they do?

• who is to inherit in the event of a common accident where they, their spouse and their children perish together?

Before meeting with your Notary Public or lawyer in order to prepare your will, these items, among others, should be considered.

Interest and Useful Links:

• About Wills and Estates http://www.ag.gov.bc.ca/courts/civil/info/wills_estates.htm

• Making a Will and Estate Planning http://www.cba.org/BC/public_media/wills/176.aspx

• Your Duties as Executor http://www.cba.org/BC/public_media/wills/178.aspx

• What Happens When You Die Without a Will http://www.cba.org/BC/public_media/wills/177.aspx

• Wills Variation Act & disinherited.com http://www.disinherited.com/articles_variation.htm

The preceding provides general information only. It is not a legal document and does not contain legal advice. It has been prepared solely for informational purposes. Relevant statutes and regulations should be consulted for all purposes of interpreting and applying the law.

By: William R. Rutledge, Notary Public
107 – 5070 Uplands Drive
Nanaimo, BC V9T 6N1
250-756-4900

Click here to download a Will instruction sheet.

Power of Attorney

What is a Power of Attorney?

It is a document that allows a person (called an ‘attorney’) to give authority to another person (called the ‘donor’) to handle legal affairs and make financial decisions for the donor. It does not extend to making decisions regarding personal care or consent to medical treatment (this is done by making a representation agreement).

It may be limited to certain assets or limited in time.

When does a Power of Attorney take effect?

Immediately upon signing unless it has a specified triggering event, such as incapacity. It ceases on death, if revoked or if the ‘donor’ becomes mentally incapable (unless there is an ‘enduring clause’.)

What is an enduring Power of Attorney?

This type enables the power of attorney to be valid even if the ‘donor’ becomes incapable. This type is useful when used for estate planning.

What is an advance directive?

It is a written statement that expresses a capable person’s wishes in advance. Most widely used is your will.

An advance directive that deals specifically with health and personal care is sometimes called a living will or health care directive. The directive uses medical terms so that doctors and families can interpret it clearly.

If you are interested in learning more about the Let Me Decide Directive – you contact myself, or Bill Rutledge.