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California Residents: Does Your Financial Advisor Tax-Manage Your RRSPs?

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California residents who hold RRSPs, LIRAs, RRIFs or other Canadian tax-deferred accounts are subject to a unique set of tax planning and reporting requirements.

california-flagUnlike most states, California does not allow Canadian retirement accounts to grow on a tax-deferred basis. And that can present a serious income-tax problem for residents of California, given the fact that the state taxes the annual income distributions (interest and dividends) and realized capital gains inside Canadian registered plans.

What are California’s Tax Rules?
California rules require its tax residents to include annual investment earnings on their Form 540. Unlike the taxpayer’s U.S. federal return, the State of California (Franchise Tax Board) requires that you pay tax annually on your RRSP earnings.

You would be responsible for including your interest (line 8), dividends (line 9) and capital gains (line 12) of Schedule CA. They will ultimately appear in Column C for additions to income. If you have a capital loss, the loss would be reported in Column B of line 12.

The State of California’s tax position on this matter is reported in Franchise Tax Board Legal Branch.

It can be difficult to avoid including this income for California State tax purposes, given that the state requires that the taxpayer’s complete tax return, including Form 8938, be included. This gives the Franchise Tax Board the ability to determine whether a taxpayer has an RRSP and has included the accrued income within their Form 540 return. To make matters worse, if a California resident were taking distributions from their RRSP/RRIF where Canadian withholding tax was being remitted to the Canada Revenue Agency (under the Treaty), this tax would not be eligible as a foreign tax credit for California State tax purposes. The state does not recognize, nor is it party to, the Canada—U.S. Income Tax Treaty.

What can be done to minimize tax?
Unfortunately and all too often, Canadian advisors overseeing Canadian retirement accounts are unfamiliar with California’s treatment of these accounts. What’s more, they do not offer investment strategies to ensure the management style and philosophy employed is uniquely mapped to California’s tax rules. And why would they? Their core clientele are Canadian residents with RRSPs, and not U.S. residents living in California. That is one of the reasons we suggest clients living in the United States, and especially California, work with a Canada-U.S. cross-border financial advisor.

At Cardinal Point, we strive to reduce taxable transactions inside clients’ Canadian retirement accounts through a tax-managed style of investing. First, we treat the account as if it were taxable (non-registered) rather than a traditional, tax-deferred retirement account. In doing so, we always consider the future tax consequences of each security selected. For example, an RRSP account being managed on behalf of a Canadian resident might typically include higher-yielding, income-producing securities. This makes sense under Canadian tax rules for residents of Canada because investment income inside an RRSP plan is tax-sheltered. In California, however, the exact opposite is true. Therefore, we select investment securities that attempt to limit large taxable transactions or distributions inside the account.

Another key aspect of tax managing a Canadian retirement account is employing tax-loss selling when possible. When a security with a capital gain is sold, we proactively sell a security in the account with an unrealized capital loss to offset the gain where possible. If a security in the account has a large unrealized capital gain, we may attempt to reduce the holding over a number of years to minimize taxes, versus selling out the entire position at once and incurring a hefty tax bill.

The ultimate goal is to tax manage the account to the greatest degree possible without compromising the integrity of the client’s overall investment strategy or performance.

Other Considerations for RRSPs
Aside from tax managing Canadian retirement accounts on behalf of California residents, we also provide the following strategies:

  • U.S. dollar-Denominated RRSPs: We have the ability to manage your RRSPs in U.S. dollars, eliminating the need to monitor the Canada-U.S. exchange rate.
  • Cross-Border Account Integration: We offer integration with your U.S. investment accounts so that the investment strategies of your Canadian and U.S. accounts complement each other.
  • Proper Tax Reporting: Our firm provides Canada-U.S. tax reporting and preparation services to ensure all IRS and state foreign account reporting and disclosures are done correctly.
  • Discharging Your RRSP: We advise on the best process, timing and tax strategy to distribute your RRSP.

California residents who hold Canadian tax-deferred accounts face a number of tax-planning and reporting challenges. In order to comply with the state’s reporting requirements, and preserve as much of your capital as possible, we strongly advise that you work with a qualified cross-border financial advisor. Please don’t hesitate to contact the team at Cardinal Point if you are interested in learning more.

Jeff Sheldon is a co-founder and principal at Cardinal Point, a cross-border wealth management organization with offices in the United States and Canada.

Options for your CAD Non-registered assets when moving to and/or living in the U.S

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The strong U.S. dollar has created new challenges for those moving to the United States from Canada—but understanding these challenges, and your options, can help you to navigate the financial transition as smoothly as possible.

canadiandollarHere’s the background. The Canadian dollar is currently valued around 0.80 versus the U.S. dollar, a big departure of 0.90 to 0.95 seen in the summer of 2014. With the currencies so closely valued in the past, many individuals elected to convert their bank and non-registered (taxable) investment-account funds to U.S. dollars, and move them to a U.S. bank or custodian.

After all, if you live in the United States and your living expenses are denominated in U.S. dollars, having much of your liquid net-worth in the local currency makes sense. Furthermore, converting and moving Canadian non-registered accounts to the United States simplifies tax and foreign-account reporting requirements. It also provides for better investment opportunities, including those that are more tax efficient. And it helps to simplify your financial and estate planning.

A Canadian dollar at 0.80 complicates things, however, as most clients naturally do not wish to convert funds at a 20% discount. So let’s look at the options available to individuals or families who do not want to convert their non-registered accounts to U.S. dollars.

OPTION 1: Leaving your Canadian investment accounts in Canada
If you work with a Canadian financial advisor, chances are they are not registered to provide investment or financial planning advice to a U.S. resident.

A financial advisor must always be licensed in the jurisdiction in which a client lives, regardless of the client’s citizenship or the country in which the assets reside. Thus, once you become a resident of the United States and ask your advisor to update your mailing address on file to your new U.S. address (never leave your old Canadian address on file: see this related article), one of three things will likely happen:

  1. Your advisor will inform you that they are no longer able to provide investment advisory services to your non-registered accounts, and that you must work with someone who is able to do so;
  2. Your advisor will explain that you can keep your accounts on the platform, but that they will be frozen and that no further trading or rebalancing can take place;
  3. Your advisor will explain that they are registered in the United States and can continue to oversee all investment-management services in your accounts.

To reiterate, most Canadian advisors are not registered in the United States. So the mostly likely scenarios are numbers one and two. In the event that your advisor fits the third scenario, you will want to make sure that their services and expertise extend beyond just providing investment management.

For example, when moving to, and/or living in the United States, clients face a host of cross-border planning complexities. A true cross-border advisor will help construct an integrated Canada-U.S. cross-border financial plan that addresses tax and estate planning matters in addition the management of your investment assets.

Now, if you decide to leave your Canadian non-registered accounts in Canada under one of the first two scenarios, there are number of important points to consider.

  • Drawbacks of Canadian funds. Canadian-traded mutual funds and exchange-traded funds (ETFs) are considered “not registered for sale” to U.S. residents. Even more importantly, they are likely to be considered Passive Foreign Investment Companies (PFIC). Earnings and dividends distributed by such vehicles are subject to the highest marginal tax rates on your U.S. income tax return. Download our whitepaper on PFICs  for further information.
  • Accounting hurdles. Canadian custodians do a poor job conforming to U.S. tax reporting requirements. For example, many do not prepare year-end tax reports that show long-term versus short-term capital gains. These reports are required if you are a U.S. resident. Further, many of the tax reporting forms Canadian custodians provide are denominated in Canadian dollars, which means your accountant will have to convert all taxable and reportable transactions to U.S. dollars when you file your annual U.S. tax returns. This additional work by your accountant can increase the likelihood of errors and lead to higher accounting and tax-preparation cost.
  • The Conversion Window. If your goal remains to convert your funds to U.S. dollars once the exchange rate improves, make sure the investment strategy put in place will accommodate a future currency conversion. For example, make sure you are not locked into investment products that must be held for a certain period of time. Also, make sure your investment accounts are not invested in volatile or speculative securities that are subject to sharp market swings. It would be unfortunate if, when exchange rates became attractive, your Canadian-dollar investment holdings were sitting at a loss due to poor market performance.
  • Tax-aware investing. Make sure your advisor is managing your account under an investment mandate that reflects your U.S. tax residency. As mentioned earlier, U.S. tax residents are subject to long-term and short-term capital gains rates. If you sell an asset that has been held for one year or less, any profit is considered a short-term capital gain, and is taxed at your ordinary income rate (up to 39.6%). If you sell an asset held longer than one year, any profit you make is considered a long-term capital gain, and is typically taxed at a preferable rate (15% or 20%). In Canada, there is no such thing as long- or short-term capital gain. Canada has just one capital gains rate, and Canadian portfolio managers are trained to oversee client accounts under this standard. Also, there are different types of investment securities, such as Canadian preferred shares, that are attractive investments from a Canadian tax standpoint but not from a U.S. tax standpoint. It is always in your best interest to confirm that the Canadian money manager or advisor can customize the management style of your portfolio to adhere to U.S. tax rules.
  • Reporting requirements. You will be subject to extra foreign account reporting requirements by the Internal Revenue Service. Because these accounts are domiciled outside of the United States, the IRS will require you to report specific information about them (account number, year-end value, highest market value in the tax year, etc.) on a form called the FinCEN Report 114. Additionally, you might likely have to file IRS Form 8938 – Statement of Specified Foreign Financial Assets as part of your Form 1040 filing as well. These increased reporting requirements are time-consuming and will likely lead to increased tax preparation costs.

Leaving your Canadian-dollar taxable or non-registered accounts in Canada once you become a U.S. resident can be done under limited scenarios. But in light of the considerations above, it certainly is not ideal.

Option 2: Moving your Non-Registered Investment Account to the United States
Moving your Canadian-dollar investment accounts to the United States will simplify financial and estate-planning initiatives, and will streamline U.S. tax reporting. But you still will face challenges. For one, most U.S.-based financial advisors will automatically want you to convert your Canadian-dollar accounts to U.S.-dollar accounts—which, of course, contradicts the goal of maintaining your holdings in Canadian dollars. The main reason U.S.-based advisors will recommend this is that their firm or its custodian does not offer multi-currency accounts. The only currency option they provide for investments is U.S. dollars. It is rare for investment firms to offer Canadian dollar-denominated accounts because there is little demand for them in the United States.

Those investment advisors that do offer multi-currency accounts may not know the Canadian investment market well enough to construct a proper investment portfolio. It is one thing to be able to open a Canadian-dollar-denominated account on behalf of a client. It’s another to be a financial advisor or portfolio manager with the knowledge base and training to build Canadian-based investment portfolios using Canadian-traded securities.

All too often, clients are left holding their Canadian-dollar investment account in cash because they cannot find a qualified U.S.-based investment manager to invest the assets.

The Cardinal Point Difference: Cross-border investment management
At Cardinal Point, we are registered to provide investment management and financial planning services in both Canada and the United States, without any restrictions or limitations. For clients who have investment accounts in both countries (RRSPs, Non-registered, IRAs, 401ks, Trusts etc.), we are able to construct integrated cross-border portfolios customized to the investor’s risk tolerance, needs and goals.

If you are an individual living in and/or moving to the United States and do not want to convert Canadian-dollar, non-registered assets to U.S. dollars, our experienced Canada-U.S. portfolio management team can help. We have the ability to invest your Canadian-dollar accounts on a U.S. custodial platform. Partnering with Cardinal Point to oversee the management of your Canadian-dollar non-registered accounts brings the following benefits:

  • Proper and customized U.S. tax reporting on Canadian-dollar investment assets
  • Multi-currency investment accounts supported by an investment team that provides Canadian-dollar and U.S. dollar asset management services
  • Flexible foreign exchange services
  • Understanding of U.S. tax management strategies on Canadian-dollar investment accounts
  • Additional cross-border financial, tax and estate planning expertise
    Please contact Cardinal Point to discuss your cross-border investment management and financial planning needs.

Jeff Sheldon is a co-founder and principal at Cardinal Point, a cross-border wealth management organization with offices in the United States and Canada. 

While Advice May Benefit Investors, Active Management Can Prove Costly

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active-passive-roadsignIn 2014, investors in Canadian-based equities watched while the majority of actively managed funds failed to meet their benchmarks, let alone outperform their passive counterparts such as index funds and exchange-traded funds (ETFs).

According to Standard & Poor’s Dow Jones Indices vs. Active Funds (SPIVA) Canada Scorecard1, only 32% of actively managed mutual funds beat the S&P/TSX composite total return index over the past three years. [Note: SPIVA compares the performance of actively managed Canadian mutual funds against their corresponding S&P indexes.] Cross-border investments fared even worse: Only about one in 70 Canadian-based actively managed mutual funds investing in U.S. equities beat the S&P 500 Total Return index over the same three-year period. Looking at the past five years, approximately one active fund in 20 outperformed their indexes. [Note: The SPIVA study was based on performance calculations minus all fees and costs through the end of June 2014.]

Active managers in Canada are not the only ones who have had a rough go in the market. According to a study this year by Bank of America2, only 18% of actively managed U.S.-based large-cap equity funds beat the market, which it made it the worst performance in over a decade for active management. [Note: The BOA study covered 2014 through the end of October.]

By in Large, Passive Management Outperforms Active
The takeaway: No matter which time frame or manager domicile examined, the overwhelming majority of actively managed accounts in large measure fall woefully short of their goals. This means that most investors in actively managed funds paid more to make less. This fact has not been lost on investors, according to Morningstar3, as we have witnessed approximately U.S. $70 billion redeemed from actively managed funds [last year through September 2014].

While research has shown that stock picking and market timing in general fail over the long term, what makes it worse is that active managers charge premium fees (versus their lower-cost passive counterparts). For example, Canadian investors can choose among several ETFs which typically charge fees (called management expense ratio, or MER) between 0.06% and 0.27% whereas the average MER for the 50 largest Canadian equity fund products is 1.9%4. Other studies, including one by Lipper, looked at the entire universe of no-load passively managed funds and found the average expense drag to be 0.83%.

According to SPIVA Canada5, based on asset-weighted returns for the period 2008-2012, the majority of actively managed funds failed to outperform their comparative indexes in all seven fund categories covered. On average, active managers underperformed their benchmarks by 2.85% per year across the seven categories during the five-year period studied, said SPIVA Canada.

This is no post-financial crisis phenomenon either. According to A Case for Index Fund Portfolios6, an in-depth study covering a 16-year period from 1997-2012, index fund portfolios outperformed 82.9% of actively managed portfolios. [Note: The study looked at three index funds managed by one provider against randomly drawn actively managed portfolios drawn from 5,000 actively managed funds available to U.S. investors.]

Dealing With Advisors and Naysayers
Unfortunately, some investors take this data to mean that they don’t need anyone advising them. While putting a large portion of your portfolio in index mutual funds or index-based ETFs can be a good start, constructing a personally tailored and diversified asset allocation can be tricky. This is where the advisors can earn their keep: helping investors structure their index-based portfolios to reflect their goals, income and liquidity needs, age and investment time frame, and risk tolerance.

Further, an advisor who understands your taxes intimately can advise on U.S. and domestic investments with a view toward tax efficiency and can enhance your returns through the reduction of your tax liability.

Naysayers are quick to point out that that actively managed funds can outperform their passive counterparts. However, carefully scrutinize the time frame cited; you will often find that most active management outperformance occurs on a short-term basis.

And in the exception-to-every-rule department, actively managed funds in select niches, say emerging market small cap stocks, may consistently do very well. When looking at the Active vs. Passive universe, it is normally assumed that the Passive portion (and most of the studies cited) are looking at broadly diversified multi-asset class portfolios and/or predominantly large cap stocks.

Furthermore, some critics will note that there are no true index funds because indices are purely hypothetical, and some funds diverge from the index more than others. In fact, they are right on this count. Not all index funds are identical. Any two may purport to mimic a standard benchmark, e.g., the S&P 500, but almost no fund owns all of the stocks in the index. Instead, they will maintain a “basket” of representative stocks. And no fund, active or passive, can maintain the same weighting as their benchmark index because the underlying values and weightings are constantly changing.

These two arguments, while noteworthy and material, do not convincingly discount the overall better performance of passive versus active funds. Perhaps more importantly, they underscore the value of an advisor who can recommend select niche products as an adjunct to your portfolio. Lastly, your advisor understands that diversified security selection paired with appropriate risk can help achieve a client’s long-term goals.

1 Tim Shufelt, GlobeAdvisor.com (November 14, 2014). Actively managed funds vs. the index: once again, no contest. Web site: GlobeAdvisor.com
2 Bloomberg News (November 15, 2014). Why did active fund managers do a bad job picking stocks this year? Web site: Investmentnews.com
3 Wall Street Journal (November 4, 2014). Investors Flee Active Stock Managers. Web site: www.wsj.com
4 Rob Carrick, Globe eBooks (2014). Rob Carrick’s Guide to ETFs. Web site: theglobeandmail.com
5 Standard & Poor’s Indices Versus Active (SPIVA). SPIVA Canada Returns. Web site: standardandpoors.com
6 Vanguard Research (April 2014). The case for index-fund investing. Web site: vanguard.com

Advisory services are only offered to clients or prospective clients where the independent Cardinal Point firms and its representatives are properly licensed or exempt from licensure. Each firm enters into client engagements independently. Past performance is no guarantee of future results. This information is provided for educational purposes only and should not be considered investment advice or a solicitation to buy or sell securities. Investing involves risk and possible loss of principal capital. Copyright © 2015 Cardinal Point. All rights reserved.

Spreading your eggs across many baskets: Why drop in oil should be a lesson to diversify

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Eggs-in-the-basketThe rate at which energy prices have fallen has caught many by surprise. Oil prices alone are down more than 50% since June 2014. While the drop in oil has lowered the gas bills for many Canadians, there are other impacts affecting households throughout the country. In Alberta for example, there have been layoffs in energy-related jobs and a housing market that has reversed course and is now falling in value. What’s more is the very real impact to Canadian investors.

Energy’s role in the Canadian economy
Canada ranks as one the world’s five largest energy producers1 with energy being Canada’s top export. In fact, energy represents 26.1% of the dollar value of exports and the equivalent of 13.4% of the GDP2. When it comes to jobs, energy represents about 5% of direct/indirect employment in Canada3, and energy-related jobs tend to pay higher than the average salary. Some areas of the country are much more heavily dependent on the industry – Alberta, for example – and the employment impacts are much more pronounced.

While the drop in energy prices on employment are obvious, less understood are the wide-ranging ramifications to other sectors, including finance. Banks may find themselves burdened with loans from failing (or underwater) energy producers. And as employment in the energy industry declines, consumer loans (e.g., credit cards, mortgages, and vehicles) may take a hit, further affecting Canadian banks’ balance sheets.

The one-two punch on energy and finance is already obvious in the trajectory of the overall stock market. In the last six months of 2014, the S&P/TSX Capped Energy Index returned -23% and the S&P/TSX Capped Financials Index returned 1%.

Home-Bias Investing: Buying what we know
Real estate agents have long touted, “Location, location, location!” A same adage is true when it comes to investment portfolios. The stock market can be unpredictable, and it is important to establish a diverse, global investment strategy that tempers potential losses in a bear market. Unfortunately, many Canadian investors fail to act in their own best interest when it comes to developing and maintaining their investment portfolios. Many investors tend to overweight their portfolios with Canadian stocks, funds and ETFs. This lack of a global approach to investing can lead to volatility and reduced returns – precisely the opposite of what investors expect when “buying what they know.” Further, it is important to remember that the Canadian economy only accounts for approximately 3% of the world economy as measured by its GDP. Investing solely in Canadian companies limits U.S. and global investment opportunities. For example, as of the end of 2014, the U.S. S&P 500 had a cumulative five-year return of more than 67% while the Canadian S&P TSX had only generated an approximate return of 24% over that same time period. It is important to remember that Canada’s two biggest sectors – Energy and Banking – represent over 60% of the Canadian S&P TSX index. Therefore, owners of mutual funds or ETFs that invest solely in the broad-based Canadian market, by default, receive substantial exposure to the oil and gas industry.

With the energy sector so prominently embedded in the economy and (often) in investors’ work lives, Canadians tend to invest a disproportionate amount of their retirement funds back into energy company stocks or funds. Those who are employed directly by oil and gas companies should explore investing their savings in areas of the market that are outside of the energy sector. For those individuals that receive stock options and shares from their companies as part of their compensation packages, a strategy should be put forth to divest themselves from their concentrated stock positions.

A Diverse Approach
Diversification is nothing new, though many are at a loss for how to actually attain it. Below are some ways in which Canadian investors can protect their assets and help reduce risk.

  • Look for variety: Diversification does not mean having a lot of investments. It means having a lot of different kinds of investments. Consider different asset classes that diversify by geography (Canada, U.S. and International), style (growth vs. value investing) and capitalization (small cap, mid cap and large cap investing). Each asset class will perform differently and can help to manage overall risk.
  • Spread your eggs across several industry baskets: Don’t put all of your money into one sector, whether it be tech, life sciences, or energy. This strategy helps protect your financial plans from derailment when one market is hit.
  • Understand your tolerance for risk – and reward: Risk and reward go hand-in-hand. Once you determine your own risk tolerance, this information will help you to build the right target mix for your investments. This investment mix will not only manage your risk-reward tolerance but can potentially improve returns at your level of risk.
  • Don’t set it and forget it: It’s important to review your accounts on a quarterly basis to make sure that investments aren’t too heavily weighted in one asset class or another. If needed, rebalance to ensure that your investment mix is aligned with your financial goals and strategy.

The optimal strategy is one that is prudent, agile and responsive, and it will be best equipped to offset risk when the market takes a sudden turn. Or as sports enthusiasts might say, a good offense is the best defense.

1 Source: U.S. Energy Information Administration
2 Source: Department of Numbers and Macleans
3 Source: Natural Resources Canada (NRCAN)

Advisory services are only offered to clients or prospective clients where the independent Cardinal Point firms and its representatives are properly licensed or exempt from licensure. Each firm enters into client engagements independently. Past performance is no guarantee of future results. This information is provided for educational purposes only and should not be considered investment advice or a solicitation to buy or sell securities. Investing involves risk and possible loss of principal capital. Copyright © 2015 Cardinal Point. All rights reserved.

9 Essential Elements of Cross-Border Transition Planning

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united-states-canada-flags“How do I move my financial life to another country?” It’s a question we hear from many clients as they begin making a cross-border transition. Whether you are making the move to the U.S. or Canada, you want to transition your finances smoothly and seamlessly while saving time, headaches, and every dollar you possibly can.

Much like financial planning, transition planning is a process and not a transaction or an end in itself. And like financial planning, the most effective transition planning hinges on a clear understanding of what you want to achieve in terms of lifestyle both now and in the future.

One of our key roles as cross-border financial planners is to learn where you are trying to go (aka, your goals and objectives) and then design a detailed plan to test the viability of your goals/objectives and ultimately get you to your destination. After all, without a flight plan, how can you know which direction to go?

Our firm’s Canada-U.S. transition planning focuses on 9 key areas that should be considered when making a move across the border:

  1. Customs Planning: This element addresses the process of relocating your assets to Canada or the U.S. Transporting belongings such as cars, pets, guns or other valuables across the border brings up specific issues that need to be sorted out ahead of any move.
  2. Immigration Planning: Whether it’s temporary or permanent, moving to and living and working in Canada/U.S. has legal ramifications. Immigration planning covers all the legal means of crossing the border.
  3. Cash Management Planning: This area includes the development and analysis of your net worth statement and an assessment of your cash inflow/outflow during your move. Our team can look at the ownership of your assets (whether between spouses or between the U.S. and Canada) and calculate a variety of financial ratios to see what challenges or opportunities arise. Your net worth statement is a benchmark from which we can analyze the impact of your move over time. We can also focus on the cross-border transition of cash and offer strategies to simplify your financial life before your move. This includes developing a prudent, purposeful and ongoing approach to currency conversion and foreign exchange.
  4. Income Tax Planning: When making a cross-border move, a comprehensive review of your current and prospective tax situation is crucial as it can reveal strategies to reduce your tax liability before and after your move. Effective tax planning reviews various techniques that may apply to your situation—including tax planning strategies that are state and province specific—all with the aim of curbing your tax liability.
  5. Independence Planning: Will you have enough money to sustain your retirement lifestyle through the decades? Independence planning uses current assets, income, and expenses to create detailed projections that help determine the long-term achievability of your financial and lifestyle objectives. Such analysis can provide valuable insights into which actions, if any, may be needed to attain your goals.
  6. Education Planning: This element looks toward the future to determine: how much is required, at what point in time, and what you need to do to fulfill future education goals. This planning can also include a review of your cross-border education savings options and what to do before a move.
  7. Risk Management: Catastrophic events such as fire, theft, illness, disability or death could devastate what has taken a lifetime to build. Risk management looks at your current exposure for risk and determines the most prudent course of action to address such risk. There are numerous differences in the way risk is managed in the U.S. and Canada. When making a cross-border move, it is vital to ensure you will be fully covered.
  8. Estate Planning: Estate planning assists in establishing order to your affairs so that you can: 1. continue to control your property while alive, 2. provide for the needs of loved ones should you become disabled, and 3. leave what you have to whomever you want, in the way that you want, and at the lowest overall cost.
  9. Investment Planning: This area focuses the investment objectives you established in your financial plan and then develops an investment portfolio to achieve your desired rate of return while also managing for tax liability. An essential part of the transition planning process is developing a properly structured and integrated investment strategy that includes your investment accounts on both sides of the border.

Are you ready to begin the transition planning process? Whatever your goals and needs are, the experts at Cardinal Point Wealth Management can help ensure a smooth road to your cross-border destination.

Terry Ritchie is the Director of Cross-Border Wealth Services at the Cardinal Point, a cross-border wealth management organization with offices in the United States and Canada.  Terry has been providing Canada-U.S. cross-border financial, investment, tax, transition, and estate planning services to affluent families for over 25 years.  He is active as an author, speaker and educator on international tax and financial planning matters. www.cardinalpointwealth.com