Global Fortunes Where in the World Should You Invest Your Clients’ Assets?
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’ ADVISORCANADA’S MAGAZINE FOR THE FINANCIAL PROFESSIONAL • JANUARY 2001 S E D G E Global Fortunes Where in the world should you invest your clients’ assets? Success stories from 12 outstanding advisors How to find some prosperous prospects PLUS Seven technology mistakes you can’t afford to make Canadian Publications Mail Product Sales Agreement #1280341, Sales Agreement Product Mail Publications Canadian Inc., Media Rogers 777 Bay St. Toronto, Ont. M5W 1A7 CONTENTSVolume 4, Number 1 January 2001 Features 19 Advisors of the Year Wondering what it takes to be an award-winning advisor? Check out the profiles of the winners and finalists of the Advisor of the Year Awards. By Harvey Schachter, Deanne N. Gage and Lisa Machado 38 Mining for Prospects Prospecting for clients is only as successful as your strategies.These three steps will open the door to new business. By Duncan MacPherson 43 Global Fortunes From paranormal predictions to portfolio manager musings, the experts take a look at what the future holds for global investing. By Lisa Machado Cover photography by Greg Holman Departments 7 INSIDE EDGE KNOW YOUR CLIENT 53 Web Designs 61 Quest for Excellence Why advice will never A Web site is a great with Nick Murray become a commodity. 16 Holiday Hangover way to attract prospects, As the new year begins, How do you help your but be sure to build it it’s the perfect time to 9 LETTERS clients when holiday right. renew your commitment Another solution to shopping leads to credit to adding value to your special-needs planning. card madness? 56 Ask Julie with clients. Julie Littlechild 11 THE PLAN PORTFOLIO Understanding your 62 NEWSMAKER Les Wiens uses inter- clients’ wants and needs John Kenneth Galbraith generational planning 47 Mutual Watch is as simple as an annual shares his thoughts to help his clients with Scott Mackenzie survey. on globalization, maximize their estates Today’s market volatility economic growth and while they’re alive. has the bear waiting in 56 The Value of Advice greedy nations. the wings. Have you with Sandra Foster prepared your clients? When the market drops, do you call your clients, CHANGING GEARS 49 Tax Break or do you leave them 58 with Gena Katz to listen to the media’s There’s tax relief ahead “advice”? for Canadian resident shareholders who receive 58 My Edge shares from a foreign Being a great advisor is spin-off. like mountain biking, says Mike Andrews (right). YOUR BUSINESS You’re always pushing yourself to do better. 51 Seven Deadly Mistakes Hoping to use the 59 Managing Internet as a successful with Harvey Schachter business tool? There Managers generally oper- are seven critical ate according to two mistakes that you theories, but only one DEBT MADNESS 16 can’t afford to make. inspires empowerment. JANUARY 2001 5 INSIDEEDGE Human touch You are the reason advice will never become a commodity. reminding me that I had agreed to a 65-year-old small business owner guest appearance as author of this builds a $1 million business. The month’s Inside Edge—the page you problem? His partner is his brother. are now holding. They don’t get along, they don’t trust My credentials are that I used to each other and, as a result, cannot write a magazine column. For many agree on a succession plan. years I wrote about the dog, the kids, A 64-year-old university professor the weather, Leo, my favourite barber, marries a 45-year-old colleague. It is and occasionally I stuck to the sub- the second marriage for both ject, which was mainly investments partners. The husband is planning to and economics. retire in a year. But there are a host of But that was another millennium. financial problems relating to the Leo turned in his clippers and went previous marriages. on to a career as a mutual fund sales- These are just two of the winning man. My oldest daughter moved out case studies in this year’s Advisor of the The financial advisor to her own apartment, taking the TV Year Awards featured on page 19. and most of the contents of the How were these challenges dealt community is the freezer with her. The dog sleeps all with? Our award winners have in most scolded body of day. common determination, resourceful- Today time is money. Or more ness, and the ability to work with professionals in the than money. Today we have conver- others on behalf of their clients. gence. Or consolidation. Today finan- They leave no stone unturned. They “country, with the cial advice is in danger of becoming are dogged, pay attention to detail a commodity. Kind of like wheat, or and are exhaustive in pursuing exception of the maybe beer. We have derivative prod- solutions. They are passionate. Montréal Canadiens. ucts, tools, and functionality. And Larry Short, Sheila Munch, Brian today we have relationship managers. Mallard and Brant Taylor received It all sounds so daunting. So dry. their awards at a lavish gala dinner at t is morning—early morn- It’s not really fodder for columnists. Toronto’s Royal Ontario Museum. It ing—in a Calgary hotel I mean, you try writing 500 words on was a fitting venue. Just as the relics I room. The phone is ring- convergence. and antiquities on display at the ing. It is 5 a.m. Must” be the wake-up I suppose I could hector you. But ROM endure, so do the human call. I’ve decided the financial advisor qualities of the Advisor of the Year Award “Hello?” community is the most lectured and winners. “Good morning, Paul. You asked scolded body of professionals in the Financial advice in danger of me to remind you that your column country, with the possible exception becoming a commodity? Get real. is due.” of the Montréal Canadiens. I will not It is not the wake-up call. It is harangue you. I will praise you, PAUL WILLIAMS Deanne Gage, the indomitable however. Or some of you. EXECUTIVE PUBLISHER managing editor of Advisor’s Edge Consider these challenges. A [email protected] JANUARY 2001 7 LETTERS Special needs The Preferred Beneficiary Election is also very important when advising clients with special needs read with interest the article on financial planning children. for clients who have children with special needs This strategy allows for the set-up of an inter vivos I (“Special needs,” November 2000, page 22). trust in which the funds earning investment income are It is true that a person with disabilities can receive an taxed at the beneficiary’s tax rate, not the high marginal inheritance or insurance settlement up to $100,000 (in inter vivos tax rate, even if the beneficiary doesn’t Ontario) without impacting government benefits. This is withdraw the funds. (This is only applicable for persons known as a Disability Expenses Trust. with disabilities.) You use the example of parents who have $1 million that they wish to leave to their two disabled children. The Paul Cuddy, financial advisor advice is to leave $100,000 to each child and set up a Great Pacific Management Co. Ltd. discretionary trust with eight other beneficiaries. Burlington, Ont. But a simpler and safer solution, and one which would be far less expensive to execute, is to set up a Henson Trust Letters wanted (insofar as Ontario is concerned), which is an absolute discretionary trust in which an unlimited amount of We would love to hear from you! Send your ideas, questions and letters to the editor money can be set aside for the beneficiary without having to [email protected]. an impact on the government benefits. Deanne N. Gage Managing Editor (416) 596-5991 (dgage@) Lisa Machado Associate Editor (416) 596-3564 (lmachado@) David J. Heath Art Director January 2001, Volume 4, Number 1 (416) 596-5059 (dheath@) Editorial Advisory Board Contributing Editors: Harvey Schachter, Peter Robert Fleischacker CAIFA Boisseau and Bert Vandermoer Sandra Foster CaratConnect ADVISOR’S EDGE HOTLINES Glenn Lightfoot RBC Life Insurance Paul Williams Editorial (416) 596-5991 Executive Publisher Ian Niven BMO Harris Investment (416) 596-5959 Financial Services Group Management Inc. Subscriptions (416) 596-5248 (pwilliams@) Scott Mackenzie Morningstar Canada Advertising (416) 596-2662 Kori Kobzina Associate Publisher Stephen Clarke AIC Fax (416) 596-5940 (416) 596-2662 (kkobzina@) Dan Thompson National Bank of Canada Garth Thomas Account Manager Thane Stenner Merrill Lynch Canada Inc. Reprints (416) 596-5856 (416) 596-5564 (gthomas@) Jim Rogers The Rogers Group Maryse Gauthier [email protected] Montreal Account Manager Financial Advisors Ltd. (514) 843-2126 ([email protected]) Lynne Triffon CAFP (B.C.), R.M. 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