RISK TOLERANCE & CAPACITY
Cardinal Point provides personally tailored investment management services for clients with U.S. and Canadian investment accounts. Investment strategies are customized to our clients’ risk tolerance and goals and then we work to fully integrate them into their tax, financial and estate planning initiatives.
RISK TOLERANCE & CAPACITY
Cardinal Point provides personally tailored investment management services for clients with U.S. and Canadian investment accounts. Investment strategies are customized to our clients’ risk tolerance and goals and then we work to fully integrate them into their tax, financial and estate planning initiatives.
All of us have lifestyle goals and aspirations. Perhaps they are as simple as ensuring a certain standard of living in retirement or as complex as planning for multiple generations spread across multiple countries with specific mandates. One baseline goal for many investors is to maintain their purchasing power over time, growing their assets faster than the rate of inflation. In order to do so, investors need to take on some level of risk. As shown on the chart below, stocks over the long run do a much better job at this than bonds, which only marginally outperform inflation.
Determining the right amount of stocks and bonds for your situation is a comprehensive task, involving multiple conversations with Cardinal Point professionals in combination with an industry leading risk profile questionnaire.
There are two main considerations needed for this decision: your risk capacity and your risk tolerance. Finding the balance that will both help you reach your goals and allow you to sleep peacefully at night is an important task.
Growth of a Dollar
1926-2024
Risk Capacity
Your risk capacity encompasses the constraints put on the portfolio, namely the time horizon and liquidity needs expected for the assets. For example, the need for a 15% withdraw for a home purchase in 3 years or entering retirement and supporting a 4% withdraw rate each year may necessitate that a meaningful portion of the account be held in somewhat lower volatility investments. Alternatively, higher or lower volatility in your income and job stability can have ramifications for what types of investments may make the most sense for your portfolio.
Risk tolerance
A perfectly designed portfolio that you can’t stick with through the down periods is not going to be helpful in reaching your goals. That’s where risk tolerance comes into play. Your risk tolerance has to do with your relationship with risk. Do you view a riskier investment as having the potential for higher returns, or does the idea of a holding dropping 40% in value make you queasy? Do you prefer a job where most of your income was from a steady salary or do you prefer potentially higher pay from a commission style compensation package? Higher allocations to stocks will have higher expected returns but come with considerable volatility. Bonds historically have had lower rates of return, but also much lower risk.
Who We Serve
Private Wealth Services for Residents of Canada
At Cardinal Point, we work with individuals and families who have made a commitment to excellence and expect it from others. Our clients come to us for a variety of reasons: the expertise of our investment management services; the integration of their tax, retirement, and estate plans; and the simplicity we bring to their complex financial lives.
Moving from Canada to the U.S.
Moving to the U.S. from Canada requires thoughtful financial planning strategies that address departure taxes, transitioning assets and investment interests across the border, managing Canadian dollar investment accounts while tax managing them based on the U.S. tax rules, as well as creating a cross-border estate plan.
Moving from the U.S. to Canada
Many people make the mistake of moving to Canada before addressing their financial affairs, resulting in missed tax-saving opportunities and potential double taxation. Our services are specifically designed to minimize tax liabilities for Americans relocating to Canada. Managing investments, taxes, and financial planning across borders is complex and requires a deep understanding of both U.S. and Canadian laws.
Canadians Living in the U.S.
For Canadians living in the US, it can be difficult to find a local financial advisor or tax practitioner that is well versed in Canada-U.S. cross-border financial planning. This forces many Canadian expats to work with multiple Canadian and U.S. practitioners which can be inefficient and costly. With Cardinal Point, Canadian expats can have the assurance of knowing all of their cross-border financial planning considerations can be addressed by one company.
U.S. Citizens Living in Canada
Our specialized services offer coordinated investment management for both U.S. and Canadian accounts, tailored Canada-U.S. financial and retirement planning, and strategies for U.S. retirement account distributions while residing in Canada. From comprehensive estate planning to optimizing retirement benefits like CPP, OAS, Social Security, and Medicare, we provide holistic advice to ensure financial peace of mind.
Private Wealth Services for Residents of the U.S.
Our clients seek a long-term relationship with a trusted wealth planner who fully understands their situation and goals. These affluent individuals and families grasp the importance of diversifying their investment portfolios, establishing a lasting family legacy, and seeking a more effective and fulfilling method for managing their wealth.
OUR RECENT PUBLICATIONS
Cross-Border Wealth Management Video with Jeffrey Adema, Cross-Border: Navigating Life as a Canadian or U.S. Expat
Are you a U.S. citizen planning to retire in Canada, or a Canadian moving to the U.S. for work? Cross-border transitions bring complex financial challenges that demand careful planning. In this insightful video, Jeffrey Adema, President of Wealth Management, Cross Border at Cardinal Point Wealth Management, breaks down the key elements of successful cross-border wealth [...]
Understanding British Columbia’s Property Transfer Tax and the 1084204 B.C. Ltd. Case
British Columbia's real estate market is known for its dynamic nature, attracting both domestic and international investors. To regulate this market and generate revenue, the province imposes the Property Transfer Tax (PTT) on property transactions. This article delves into the intricacies of the PTT, its implications for foreign entities/nationals, and examines a recent pivotal case: [...]
Navigating Cross-Border Retirement Benefits in 2025: US Social Security and Canadian CPP/OAS
Cross-border retirement planning has never been more relevant. In 2025, many Canadians living in the U.S. and Americans living in Canada face complex questions around Social Security, CPP, and OAS benefits. Our updated article explores how longstanding agreements like the totalization agreement (1984–2025) and the U.S.-Canada tax treaty continue to shape eligibility and taxation rules—while addressing key developments such as the 85% inclusion rate, new e-filing systems, and the growing importance of residency status. Whether you’re planning to retire soon or already drawing benefits, understanding where and how your income is taxed is crucial.