Retirement Planning
for the
Canadian Investor

Home Page


Client's Comments

Associated Sites


Financial Commentary

Tax Strategies

Borrowing to Invest




Design by
CY7 Computer Services


September/October 2012

Commentary - Hans H. Mathisen

How to teach your children financial independence - LIFE LETTER for September contains the basic rules to accomplish this. I have personally used this strategy with two of my grandsons, so I know the process works.

Insurance needs for small business owners - is the topic for the October issue of LIFE LETTER. Both Disability Insurance and Life Insurance may be even more important than Fire Insurance.

LIFE LETTER MATURE -"You Don’t Necessarily Need to Wait to Give it Away"points out various ways seniors can use to distribute their wealth to their children and grandchildren while they are still alive."Avoid the ‘Boomer-Widow’ Financial Syndrome"gives the future ‘Boomer-Widow’ a few suggestions about how to be a widow.

THE STOCK MARKETS - September 28 was the last day of business for the third quarter of 2012, and the S & P TSX was up 3.03% year-to-date. The Dow Jones stood at +9.98%, and the S&P500 at +14.56%, while the Nasdaq recorded +19.62%. In Europe, Germany’s DAX was up 7.75%; France’s CAC down 11.83%; and England’s FTSE 100 was shrank 2.68%. In Asia, Japan’s NIKKEI was down 13.28%, and Hong Kong’s HANG SENG fell 9.53%.

What have I learned about the market and investing since the collapse of Lehman Bros. and the start of the financial crisis in the fall of 2008? It’s more a confirmation of old knowledge than new discoveries.

Stick to the basics:

When you look at each component of the different funds you are invested in, you will see that the great majority of the companies are Blue Chip Stocks. These top Blue Chip Stocks are still some of the best investments now, as they have proven they can weather any economic environment and continue to pay steady dividends and grind out long-term share price returns.

This group includes companies like TD Bank with dividends at 3.32%; Bank of Nova Scotia at 3.85%; Trans Canada Corp. at 3.71%; Enbridge at 2.78%; Thompson
Reuters Corp. At 4.53%; Talisman Energy at 4.34%; and Shaw Communications at 4.73%.

Your funds invest in solidly run Canadian companies that can make it in good times as well as bad. And if markets remain volatile, patience is the key.

We have to think of ourselves as part owners of these wonderful businesses, then ignore daily price fluctuations and think long term.

Now is also a great time for me to thank you, my client, for introducing me to your friends and family members throughout the year. This is a tremendous compliment and a huge responsibility and something I will never take lightly.

Hans Mathisen





How to teach your children financial independence

Now may be the perfect time to teach your children about financial independence. There are plenty of real-life examples in the media of how Ďnotí to manage your finances. To really teach children money management skills, they must learn to handle money personally and to make consequential decisions on how to manage it.

An allowance is an ideal way to set a solid financial belief system for your children that will have a lasting effect well into adulthood. Money management requires discipline obtained through practice, trial-and-error and observation. Itís also learning to balance desire and practicality when it comes to financial issues.

Not everyone agrees on whether you should pay your child an allowance based on services rendered, such as the completion of chores, or whether it should be given freely with chores being an unpaid necessity of family life. Positives are seen in both options. The following are tips to start your children on the road to financial mastery:

Teach them how to save. There are many formulas used in money management to facilitate saving. Consider using a 10/10/10/70 system. Under this system ten percent of income is used for savings, investing, and charity. The remaining 70% is used for everyday expenses. This method can also get them into the habit of paying themselves first.

Teach your children about relative value. Letís say your child wants to purchase a video game priced at $50 and theyíre receiving a $10 per week allowance. Show them, using your financial management formula, how long it will take to purchase the game.

Help them develop financial self-discipline. Teach your children that for every purchase, something must be given up. Help them determine the difference between needs and wants.

Let them make some mistakes. Life is about choices. If we donít always make the right ones, how can we expect our children to? Allow them to learn painful financial lessons while they are dealing with small amounts of money and not the larger amounts they will be dealing with as adults.

Allow them to find a solution to their financial missteps and resist the temptation to "bail them out."

Teach them how to invest. Invest in something interesting and exciting. An investment in Savings Bonds will not hold the interest of the child (or earn much interest these days). Look towards a purchase of stock in a favourite company, perhaps a sporting goods, technology or entertainment company for which the child has a particular connection.

Self-discipline is the key to success in life and a successful money manager will need to develop this attribute. Experts agree that teaching kids to save, invest and make wise spending decisions will go a long way towards ensuring they prosper as adults. An allowance can be a powerful tool for teaching children lifelong money management skills.

Teach Financial Independence - because it's the right thing to do. Call today!

Call Hans Mathisen today at (306)242-7042.
or email -

Copyright © 2010 Life Letter. All rights reserved

[Top Of Page]






Insurance needs for small business owners

For many small business owners, what began as a bright idea or an innate desire to exercise their entrepreneurial spirit turned into a new enterprise with the promise to provide for them and their families. Even the most successful small businesses are significantly reliant upon the continued health, vision and skills of the business owner or a key person. Without the owner or key person, the likelihood of the business continuing is greatly diminished. It can mean instant death for the business with devastating consequences for the owner, employees and their families.

Instead of putting money in savings or investments, many business owners are more apt to plow it right back into their business. When contingencies arise, they either need to borrow money or sell business assets. The bottom-line for many small businesses is that, if any unexpected interruption in their cash flow occurs, they may lack the resources needed to sustain them for even short periods of time.

Business owners are usually very adept at planning for business risks such as competition, market changes, and operational problems, but very few plan effectively for such risks as their own disability or death. While their business is prepared to recover from anticipated business risks, their business and family is left financially vulnerable should the owner fail to show up for work. Protecting a business and a family against the possibility of the death or disability of a business owner or key person is the cornerstone of any business plan.

Disability Protection - What would happen to your business and your family if, due to an accident or sickness, you couldn't show up for work for an extended period of time? A disability income insurance policy protects against the loss of income due to a disability, and a business overhead expense policy can cover many of the expenses associated with keeping the doors open for a period of time.

Life Insurance - Similar question, what would happen to your business and family if you had died last night? Life insurance can protect you and your business in a number of ways:

First, it provides the capital your family will need to meet their immediate cash and income needs.

Second, life insurance can protect your business from the loss of a key employee without whose special expertise or skills would cripple the ongoing operation. By having insurance on the life of the key person, the death benefit provides a lump sum, taxfree, that can be used to replace lost cash flow and fund the cost of finding a replacement.

Third, if you are a partner in a business, life insurance is essential to protect the business in the event of the death of a partner. Life insurance proceeds can be used to buy the partnerís business interest from their family. Otherwise, the family could insist on the sale of the business or an ongoing income in order to receive their interest.

On the surface, insurance is a simple concept Ė a promise of future capital for a small current premium. However, when used to address business needs, additional tax and legal implications need to be considered. Structuring insurance policies within certain business arrangements requires careful planning and implementation.

Small Business Owners Insurance - because it's the right thing to do. Call today!

Call Hans Mathisen today at (306)242-7042.
or email -

Copyright © 2010 Life Letter. All rights reserved

[Top of Page]

[Home Page] [Services] [Financial Commentary] [Tax Strategies]
[Associated Sites] [F.Y.I.] [Client's Comments] [Biography] [More Info]

Mutual confidence is the power that binds together all harmonious human relationships.

Mathisen Financial, Inc.
335 Redberry Road
Saskatoon, Saskatchewan S7K 4W5
Bus. (306) 242-7042 Fax. (306) 242-4314