Check out our new documentary DEBTASIZED.

Check out our new documentary DEBTASIZED.

How to Find a Credible Financial Planner

How to Find a Credible Financial Planner

Did you know that in Ontario, anyone can call themselves a financial planner? With this in mind, how can you make sure that you are getting expert and unbiased advice on money management? Should you trust the financial planners who work at banks? Are they credible or do they just want to sell you mutual funds?

My guest today says that if you want an honest assessment of your finances, you should speak to an advisor who doesn’t sell products, but rather, advice.

Jason Heath is a Certified Financial Planner (CFP) and a fee-only financial planner, which means:

I sell my advice for a fee. Lately I’ve started to use the moniker ‘advice only.’ Some people will call a fee-only financial planner, a fee-for-service financial planner.

The key difference between him and financial advisors who work at banks is independence:

I don’t sell investments. I don’t sell insurance. I’m not a mutual fund salesperson as most financial planners are.

Finding a Credible Financial Planner

As it can be confusing to know who to trust, Jason recommends taking the following steps to ensure you are getting helpful, unbiased advice:

  1. Make sure they are certified by the Financial Planning Standards Council and have a Certified Financial Planner (CFP) designation.

    There’s people who call themselves wealth planners and wealth advisors and all these crazy names that you really don’t know what they do. It’s a big problem in this country and certainly in this province.

  2. Avoid banks. If you don’t want to be sold a financial product, but just need an honest look at your financial picture, it may be in your best interest to avoid going to a bank for financial advice.

    If you walk into a bank and you ask for financial advice and the only way that person gets compensated is selling TD Bank mutual funds, there’s a pretty good chance you’re going to get sold a TD mutual fund even though debt repayment may be a better option.

  3. Do your homework. Before visiting a Certified Financial Planner, take a look at your own finances and figure out the questions you want to ask. When you see a fee-only or advice-only financial planner, you are essentially paying for their time, as you would a lawyer, for example. Therefore, to make the most of your visit, get a sense of what you would like to learn about in advance. What’s more, ask if your financial planner has experience handling a situation like yours.

Related: Bankruptcy advice should come from a Licensed Insolvency Trustee

What Income Do You Need to Work With a Financial Planner?

Fee-for-service financial planners charge for their time. So can you afford one?

Jason says that big investment firms do often cater to high income households. Often you need a minimum investment to participate. With a fee only, or fee for service financial planner you are paying per hour, much like you do a lawyer or an accountant. You don’t need a minimum net worth to get advice.

I’ve seen more average people, more young people reaching out to people like myself and even the industry I think has felt a gap. There’s a lot of my competitors quite frankly out there who cater towards millennials and cater towards people that may not have otherwise been catered to before.

Be Cautious When Using Investments to Pay Down Debt

A common question from indebted Canadians is whether they should use their RSPs to pay off their debt. Jason believes it can be a very expensive decision:

In order to pay off $50,000 of debt, it’s not as simple as pulling $50 000 out of your RSP. You have to pay tax on money that you pull out of your RSP. So you might need to pull out $100,000 to be left with $50,000. I think it can be short-sighted sometimes to look at an investment account like an RSP and say “Well, I might as well just pay it off. Pull money out and pay off this debt.”

Instead, it might be wiser to file a consumer proposal, where you not only repay less than what you owe on your debts, but you also get to keep your investments. According to Jason, sometimes people with the best financial intentions and good financial positioning get themselves into trouble without realizing it. This is why it’s important to make informed decisions and to know that you are meeting with a neutral advisor.

To learn more about how to find a credible financial planner, tune in to today’s podcast or read the complete transcription below.

Resources Mentioned in the Show

FULL TRANSCRIPT – Show 198 How to Find a Credible Financial Planner

how to find a credible financial planner

Doug Hoyes:    I wrote a book; Straight Talk On Your Money. You probably heard me mention it once or twice on this podcast. When I sent the manuscript to my editor, she read it and told me that all of the chapters made sense except for one where I talked about investing. She said it was outside of the theme of the book. I disagreed, we had a lively discussion back and forth, and in the end my editor prevailed, and I shortened the chapter – chapter 16 for those of you who are following along at home. In that chapter I made the point that before worrying about investing you should reduce your debt, minimize your expenses, develop a savings habit and start reading books and articles on learning about investing. It was a short chapter. Only six pages. So, I published the book and since then I’ve given talks at places like libraries and invariably, after every speech I give, someone asks me about investing. “What should I invest in?” I don’t give specific investing advice so I refer them back to chapter 16.

But it’s a good question; if you take my advice and deal with your debt and you balance your budget and start saving money, what should you do with your savings? One answer is to hire a financial advisor but how do you know who you can trust? Is the person at the bank a financial advisor? What about someone selling you mutual funds? Are they a financial advisor or are they just a salesman who makes their money selling you something? Am I right about debt? Is debt a problem heading into retirement or with low interest rates is that something that you don’t need to worry about? I’ve got lots of questions and today I’ve travelled to Markham Ontario to interview a guy who can answer those questions and more, so let’s get started. Who are you and what do you do?

Jason Heath:     Hello Doug. My name is Jason Heath. I’m a fee-only financial planner and to clarify what that means is that I don’t sell investments. I don’t sell insurance. I’m not a mutual fund salesperson as most financial planners are. As a fee-only financial planner, I sell my advice for a fee. Lately I’ve started to use the moniker ‘advice only.’ Some people will call a fee-only financial planner, a fee-for-service financial planner, but it’s a financial planner who doesn’t sell products, he sells advice.

Doug Hoyes:    So, let’s contrast then the two different types though. So, you know, I go to my bank and I talk to the bank person there and they say “Oh you need to buy this mutual fund.” How does the bank make money?

Jason Heath:     Well, generally when you invest in any financial product including a mutual fund, there are fees that are embedded that get paid to the investment firm and to the advisor. Quite frankly, oftentimes working with someone in a bank you’re not even working with someone who is a certified financial planner or even a financial planner for that matter. They might just have a mutual fund licence and a little bit of training so it’s hard in Canada quite frankly, to tell exactly who you’re talking to and what professional competencies they have.

Doug Hoyes:    So, I want to get you to clarify that but let’s finish off then on, you know, an advice-only planner or a fee-only planner, and the other kinds. So, I buy a mutual fund from the bank or my investment advisor, whatever, they’re getting compensated by the mutual fund company then?

Jason Heath:     Yeah, more often than not when people are working with a financial advisor, they’re getting paid based on the products that they’re purchasing or the investment or the insurance that they own.

Doug Hoyes:    Got you. So, if I go to the bank, the bank has a suite of funds that they can sell me but it’s not a suite of every fund, it’s only the funds that the bank deals with.

Jason Heath:     Exactly.

Doug Hoyes:    And if I go to ABC mutual fund company, well obviously they’re only going to sell me ABC mutual funds, they’re not going to sell me anything else.

Jason Heath:     Yeah.

Doug Hoyes:    Okay, so I get that and I can see that there’s kind of a bit of bias there then because if I’m the person selling ABC funds, I’m only going to sell ABC funds. I’m not going to sell you any other kind of fund but I’m also perhaps not going to sell you , you know, stocks or bonds or real estate or . . . I don’t know; cryptocurrency or whatever the latest thing is. I mean, we’re recording this in June of 2018, right? Have I got my years right?

Jason Heath:     You got it.

Doug Hoyes:    The big thing in the news right now is all these cannabis stocks. That’s the latest thing. Cannabis, cannabis, you know, these are where all the stocks are. Well, the mutual fund companies don’t have any of those yet because well, as we record this in early June it’s not fully legal yet and so they don’t want to get into it. So, you’re somewhat biased in what you’re getting but then there’s the whole fee aspect of it. So, explain that to me then. So, you said you are a fee-only financial planner so how – I just pay you then; is that how it works?

Jason Heath:     Yeah, I mean we operate not unlike a lawyer or an accountant who charges a fee for their services, who sells their time. Whether it’s on an hourly basis, whether it’s on a project basis. Sometimes we charge annual retainer fees. So there’s different ways to pay for financial advice. This is one of the least common ways to do it but I think the example you gave of the mutual funds salesperson with a bank is a great one. If you walk into a bank and you ask for financial advice and the only way that person gets compensated is selling TD Bank mutual funds. There’s a pretty good chance you’re going to get sold a TD mutual fund even though debt repayment may be a better option, even though investing in your business may be a better option, even though something other than a mutual fund may be a better option. So, you know, they say when you’re a hammer, everything looks like a nail and that’s part of the problem with the financial industry. It’s one of the reasons that I love what I do because we’re indifferent, we don’t have a certain outcome that we’re looking to achieve, we just sell advice and whatever advice applies to this specific client, we can give it with no strings attached.

Doug Hoyes:    So, at what level of income or assets does it make sense to start dealing with someone like you? I mean if I’m a 17 year old kid with a paper route – well I guess there’s no such thing as paper routes anymore – and, you know, I make 20 bucks a week, then that’s probably not – I’m probably not dealing with you but at what point does it make sense to have a conversation with someone like you?

Jason Heath:     Yeah it’s a good question. I can say when I look back – I’ve been doing this for 16 years now – and certainly in the early days most of my clients were high net worth individuals. People with lots of money, people with high incomes; I’ve seen my own practice evolve over the years where I have a lot more young couples that I work with, a lot of people with more average situations who are looking for financial advice. It’s tough sometimes because a lot of the advice out there is catered towards people who have lots of money. You can’t write a check to certain investment companies who may have a $500 000 minimum investment but you might have great questions that a fee for service or fee only, advice only financial planner can answer. So I’ve seen more average people, more young people reaching out to people like myself and even the industry I think has felt a gap. There’s a lot of my competitors quite frankly out there who cater towards millennials and cater towards people that may not have otherwise been catered to before.

Doug Hoyes:    So, is there a dollar value you can put on it?

Jason Heath:     No, really there isn’t because at the end of the day when we’re charging for time somebody might only need an hour of time, they can pay for an hour of time the same way they would with a lawyer or with an accountant. So, they don’t need to have a minimum net worth or a minimum income or anything like that. I think that is one of the best thing about the fee for service industry. It’s really expanding to be available and accessible to everyone.

Doug Hoyes:    So, obviously this is a podcast about debt so a lot of the people who listen to this podcast have gone through either a bankruptcy or a consumer proposal and now they’ve come out the other end. So before they dealt with their debt, they might have had monthly minimum payments of $1 000, $2 000 a month on all their credit cards and bank loans and everything like that. So, now that their debts are taken care of, well that freed up a huge amount of cash. All those minimum payments they don’t have to make. So, using the example of someone who had a couple of thousand dollars a month in minimum payments which sounds like a huge number but that’s actually fairly typical of what a lot of my clients are dealing with, it doesn’t free up $2 000 of cash because a lot of that they were just using their line of credit to make the minimum payments. But in a lot of cases yeah, they are a $500, $1 000 a month farther ahead than they were before they went through the process.

So, is that the kind of person who should think about reaching out to a financial planner or should they wait a certain period of time until they’ve got a certain amount of money in the bank before thinking about something like that?

Jason Heath:     I would say it depends. I would say that it relates to, you know, it necessarily relate to money you have or money that you can invest or anything like that. It’s more related to questions you have, any answers you are seeking. You can buy an hour of a financial planner’s time and sit down and ask, you know, “Should I be putting money in my RSP or should I be putting money in my Group Defined Contribution Pension plan. Should I be putting money in my TFSA? How does a RESP work? Take a look at my financial situation and give me some direction.” We certainly work with lots of clients that we build very comprehensive in-depth financial plans for or people that we work with year in year out on an ongoing basis. But there is plenty of people out there that just need an hour of time to get answers answered quite frankly. Sometimes it’s not stuff you can find in a book or on the internet and it’s nice to have someone who’s not trying to sell you something, give you a little bit of advice. So, I think it can work out well for people in a situation like you described.

Doug Hoyes:    And my book only had 6 pages on it so you’re right, you’re not getting a whole lot of answers on that specific topic in that book. So, you do have clients who say “Okay I’ve done a bit of research and I understand these things called TFSA’s and RSP’s and thisses and thats but I don’t fully get how it works for me. So, I write out my list of questions, I come in, I sit down with you for an hour or two or whatever” and then, you know, “Here you go here’s your – ”

Jason Heath:     Take notes and ask the questions that you want to ask. Sometimes it may require some follow up but that’s not unlike going to another professional and getting some advice. Sometimes we even describe it as – it’s almost like going to a doctor for your finances when you work with a financial planner or not a financial planner that sells mutual funds and insurance but a true professional financial planner. You go, you do a financial health diagnosis, you have a prescription that is written and a prescription that is not tied to an end product and that’s the problem with a lot of the financial industry. You’re getting prescribed things that are biased and not objective. This is a way to ensure objectivity.

Doug Hoyes:    So I pay you a few hundred bucks, you give me some advice and as my wealth increases, well maybe I am paying you a few hundred bucks every month but maybe a once of year kind of thing.

Jason Heath:     Yeah, maybe maybe not and we certainly, I mean we’re biased, I always tell people our sole conflict of interest; we sell time we’d like to sell as much as possible, we’d love everyone to be a lifelong client but some people just need a meeting. Some people just need an hour of time and have some questions. Some of those people may come back in the future, they may not, but we try to describe to clients “Here are the ways in which we can help. You tell us if one of them’s a fit.” Not “You need to sign up and we need to meet once a year and you need to write a check every year.” Yeah, that’s our bias but not everyone needs ongoing financial planning. Some people just have a few simple questions.

Doug Hoyes:    Now, you mentioned the term financial planner and so my understanding is that that’s – and you are going to correct me if I am wrong here but that’s a made up word because if I am in Quebec or if I am in different provinces, I can call myself a financial planner because it’s just a word. I may be a chartered accountant, what we now we call a CPA, well that’s an actual thing. I’ve got initials, you know, you can’t just call yourself that. You can’t just call yourself a medical doctor; there’s actually stuff you’ve got to do. But is it true that in certain places in Canada I can call myself a financial planner?

Jason Heath:     Yes, I mean Quebec is the only province in Canada where there’s really any restrictions. In Ontario and all the other provinces, and territories for that matter, anybody can be a financial planner.

Doug Hoyes:    So, I could call myself a financial planner?

Jason Heath:     Absolutely.

Doug Hoyes:    My mechanic could call himself a financial planner.

Jason Heath:     Absolutely.

Doug Hoyes:    Okay, but I’m guessing there’s more to it from your point of view.

Jason Heath:     Yeah, absolutely. And, you know –

Doug Hoyes:    What should I be looking for then? Anyone can call themself a financial planner.

Jason Heath:     It’s something that in Ontario, there’s a lot of work and consultation being done to try to figure out who should be allowed to use the term financial planner. I think it’s really important, you know, I am a certified financial planner, I am a CFP, that’s my professional designation. Again, I’ve got a bias to say that that should be their gold standard but it’s concerning to me and it should be concerning to consumers that you really don’t know who is a professional and who has the proper credentials. There’s people who call themselves wealth planners and wealth advisors and all these crazy names that you really don’t know what they do. It’s a big problem in this country and certainly in this province.

Doug Hoyes:    If I work at a bank selling mutual funds, how much training would I get?

Jason Heath:     In order to get a mutual fund designation to be licensed to sell mutual funds there is not a lot of training that you need to do. There’s a course you need to pass, you could probably do it all in a couple of months. You have knowledge in mutual fund products, you certainly don’t have knowledge in financial planning. I may also go so far as to say that there are a lot of people out there that have professional financial planning designations that they’ve been given that sort of, you know, do the hard work up front, get the designation and then might have 20 or 30 hours of ongoing continuing education they need to do that doesn’t need to be too in-depth or complex. I’ve seen a lot of financial planners, including certified financial planners whose advice leaves something to be desired, quite frankly.

Doug Hoyes:    So, what is involved to become a certified financial planner; a CFP?

Jason Heath:     You know, it’s funny you ask now and I am not sure exactly how much it’s changed over the years but you need to take courses. There is a number of courses you need to take, pass successfully, there’s exams you need to take. I think now at this point there are two exams you need to take to become a certified financial planner. Then you need to do a certain amount of time working in the financial industry – I believe its two or three years. So there is courses, there is exams, there’s professional experience, then there’s ongoing continuing education that needs to get done. I think that the Financial Planning Standards Council and the CFP designation in my opinion is their gold standard but the financial planning standards councils also have been very honest I believe with consumers. I’ve seen marketing that they’ve done to say that “Look, not all CFP’s, not all certified financial planners are created equal.” And that’s kind of interesting to see that from a professional body to say “Look we are confident in what we put out there.” But not all CFP’s are all the same, I think that is really important for consumers to remember.

Doug Hoyes:    Well, I guess that’s the same as saying not all chartered accountants or not all CPA’s are the same.

Jason Heath:     You got it. Absolutely.

Doug Hoyes:    You don’t want to come to me for detailed corporate tax advice because even though I studied it 20 years ago that’s not my area of expertise. So how then should someone listening go about trying to hire a financial adviser or a financial planner.

Jason Heath:     I’ll be frank, I’d like to give you a good answer, but I don’t have a good one. I have people asking me sometimes even “How do I pick an investment adviser?” It’s tough because there is no designation in my opinion that can adequately describe a person’s level of knowledge. I come across people who are not certified financial planners who have very strong financial planning knowledge. I come across other CFP’s who are really good at, you know, whatever company they work for knowing their mutual funds in and out but know nothing about tax or estate planning and other components of financial planning. So, it’s hard, I think at the very least I would look for a professional designation but I think it’s also important to ask questions and just know what you’re looking for. If someone is looking for complex tax and estate planning advice, definitely not all CFP’s are created equal. If you’re just looking for someone to, you know, write an insurance policy or something then that requires a different skillset.

Doug Hoyes:    So, ask questions, “Here’s what I think I need, you have that expertise” then I guess, you know, asking around too.

Jason Heath:     Asking around kind of sort of helps but the other thing I’ve found over the years, a lot of clients we work with who say “I’ve got this great investment advisor you know. I’ve worked with him for 20 years” and you sit down and you look at their investments and you say “This isn’t very good.” Sometimes people don’t have good perspective on what good is. We do. So, even asking a family member or a friend “Do you have a recommendation” you might get a recommendation they think is excellent but isn’t. And it’s one of the reasons why I think government regulation, particularly here in Ontario where they are looking to restrict the financial planning designation and provision for financial planning advice, is super important because it’s so broad what you get out there.

Doug Hoyes:    Well, and I’ve always been a big believer in you have got to look after yourself. So, that’s why you know in the six pages of the book I did address this issue, I did make the comment that I think it is a good idea to read books, get some vague understanding so that when you are interviewing a potential advisor you at least have a vague clue what to ask. I mean if I’ve got a medical issue then I mean I am going to go to the internet and look it up and I will obviously misdiagnose myself because I am not a doctor but at least I know a few questions to ask “Hey doctor, do I have this because it looks like my symptoms be it.” “No, you’re not pregnant Mr Hoyes. I don’t you think you got the wrong [unintelligible 00:14:54] you know. At least you got a bit of a baseline as to where to start. So okay, it’s difficult. I mean that’s what you saying. You’re going to have to do some due diligence here and I guess the more important your money is to you and protecting it to you, then you’ve got to put some effort into it.

It’s not really realistic to say “Well, I’m going to spend ten minutes a year thinking about my money and my investments and everything” you’re going to have to do a little bit more than that and find someone who can help you through it.

Jason Heath:     Yeah.

Doug Hoyes:    Okay, so this show is about debt so I want to ask you some questions about debt. You write for a number of publications; is one of them and in that one you answer questions from readers and there was one question that you answered a few months ago and I’ll put links to this in the show notes over at, but the question was and I am going to quote it here; it’s from a guy named Art. I am not sure if that’s his real name or not, but let’s assume it is, “I’m retiring, single male, 65 years old, with $850 000 total in RSP’s and a DCP where I currently work.” What’s a DCP?

Jason Heath:     That’s a Defined Contribution Pension plan, so sort of like a group RSP effectively.

Doug Hoyes:    Got you and a Defined Contribution one.

Jason Heath:     Yeah

Doug Hoyes:    So, he’s got assets, he’s got retirement assets. “I have no debt, I owe $50 000 on a $500 000 home. I pay $730 a month. Mortgage is due May 2019, penalty would be minimal. Should I pay it out in 2018, my first year ‘unemployed’” meaning retired; “What are my options?” So, that’s Art’s questions. Now, I personally think it’s great that Art says “I have no debt, I owe $50 000 on my home.”

Jason Heath:     Mortgage isn’t debt.

Doug Hoyes:    Yes, exactly. So I’m not really quite sure – you could have no debt but owe money. But anyways, I guess what he’s talking about is unsecured debt. He’s talking about debt not secured by a home. So, before we get to Art’s question, do you find it common that people don’t think of mortgages as debt?

Jason Heath:     Yeah, absolutely. Frequently people say “I have no debt but I have a $500 000 mortgage.” People don’t and I think particularly in recent years, particularly in Ontario, particularly in the Toronto area. I mean, a mortgage is a means to an investment. Being real estate that just continually rises until this year. So, yeah, I see that all the time and I think it’s a misnomer. It is.

Doug Hoyes:    Yeah, it is debt. I mean maybe it’s not as damaging as payday loan or maybe it is. I mean, we can perhaps talk about some of your client experiences but . . .Okay, so let’s break Art’s question down into two parts. So, I think what he’s actually – he’s talking about secured debt; his mortgage. But let me ask you first what’s your opinion on carrying unsecured debt into retirement. So, I’m talking about debt like credit cards and payday loans and things like that.

Jason Heath:     Well, you know, I think that in a perfect world, retirees have no debt. I think in a perfect world nobody has debt, but we don’t live in a perfect world and I find it – sometimes I think it can be arrogant for financial planners to say, you know, “You can’t have debt in retirement.” Frankly, sometimes it happens, frankly sometimes people, you know, get retired earlier than they wished to retire. A severance package a few years before they want to retire. They have a child who’s sick or goes through a divorce and needs help. It happens. I think to the extent that you can try to avoid debt going into retirement makes sense but sometimes it does happen and I don’t think it’s necessarily the end of the world. Particularly when I look at Art’s case here; $850 000 in investments, $500 000 home. He’s got $1.35 million in assets and a $50 000 mortgage. It’s not much, it certainly doesn’t worry me as a financial planner on the outside looking in. I don’t know all the other factors but that’s not a big worry. It is clearly to Art though.

Doug Hoyes:    Well, okay, so let’s talk about Art’s situation then. What is your advice to him because he’s sitting there going “Should I – ” I mean he does state this in the question but what he’s really saying is “Should I cash in some of my RSPs and use that money to pay off the mortgage so that there is no mortgage when I retire.” How would you walk him through that thought process?

Jason Heath:     I think in Art’s case and in anyone’s case, I sometimes see this with people who are in their working years and say “I’ve got this debt and I want to get rid of it. Should I just pull money out of my RSP?” and my answer would be the same as it is to Art. In order to pay off $50 000 of debt, it’s not as simple as pulling $50 000 out of your RSP. You have to pay tax on money that you pull out of your RSP and Art might need to pull out $100 000 from his RSP to be left with $50 to pay off the debt. So, is it worth pulling $100 000 from your RSP to pay off $50 000 in debt? I don’t know. Particularly during your working years when you have a high income, I’d say pulling money out of your RSP to pay off debt is generally not advisable. At least Art’s retired, probably has a fairly low income, but Art still needs to pay for his other living expenses. All he has is RSPs. He might need to pull $200 000 out of his RSP in the next year to pay for his living expenses and pay for paying off this debt.

So, I think it can be short-sighted sometimes to look at an investment account like an RSP and say “Well, I might as well just pay it off. Pull money out and pay off this debt.”

Doug Hoyes:    And I guess if we were talking 10 years in the future when mortgage interest rates are, you know, 12% and you’re earning 1% in your RSP, it might be a different story.

Jason Heath:     It could change things. I mean, that’s part of it as well. If he’s got a mortgage; he doesn’t reference the interest rate but I’d be surprised with that much home equity and that strong a net worth if he was paying a higher rate. If he’s paying 3% on his mortgage interest rate and even if he’s investing at 3%, it’s at least a wash. I think it would be different if, in this case, the money was in a tax free savings account where he could pull the money out tax free or if it was a regular investment account or a savings account. That’s different. But, when you’re talking about RSPs and debt, it can be very expensive to pay off debt with RSPs and that’s something for all your listeners to pay attention to.

Doug Hoyes:    Yeah, and I guess that’s a classic example of where talking to a financial expert is a good idea because they can actually walk you through that scenario. I see this in my business all the time. I don’t have a whole lot of people of $800 000 in their RSP, but certainly people of some money and they say “Well, you know, I’m thinking of just taking the money out and paying off my debts.” Well, if you’ve got 25 000 in your RSP and you got $50 000 worth of debts, then you can’t eliminate your debt by taking the money out and when you do take the money out, like you say, you get hit with a big tax hit because it will be at whatever your top marginal tax rate is. So, in a lot of cases if you’ve got a huge amount of debt – and that’s obviously not Art’s case here because he doesn’t have any unsecured debt – but doing a proposal or a bankruptcy may be a better option because so long as the money has been in your RSP for a year, you’re not going to lose it even if you go bankrupt. So, again, I’m not saying that “Oh well, that’s definitely what you should do.” I think you and I are saying the same thing.

Jason Heath:     Consider it, yeah.

Doug Hoyes:    There are options either way, talk to someone who actually knows and decide from there.

Jason Heath:     Absolutely. I think it’s really important whether it’s a listener who is in this situation or even their advisors. I think it’s something that a lot of financial advisors, financial planners, wealth planners, you know, whatever you want to call them, have to consider as well. I mean, they may have a client who’s in a good position financially because they have a lot of investments but get in trouble, spending too much money and find themselves in need of your services.

Doug Hoyes:    Now, we’re sitting in Markham Ontario here where the real estate market has been very strong over many years because we’re basically on the northern tip at Toronto. Do you have clients who are heavily invested in real estate? Is that a concern of you? What’s the typical profile of – what kinds of things are you seeing?

Jason Heath:     Yeah, you know, we work with all different kinds of clients whether in Toronto or elsewhere in Canada or even the world for that matter. So, we see a pretty big cross section. But I certainly do come across more and more people these days who are taking on large amounts of debt to move into larger homes, you know, modelling out long-term financial plans. We’re showing them “Look, you’re never going to pay this debt off. Downsizing is going to have to be part of your retirement plan so to speak.” One of the things that worries me a lot is when you have two high income earners who take on a huge amount of debt. What happens if one of them loses their job, what happens if one of them becomes disabled and doesn’t have adequate disability insurance. It’s pretty easy to get yourself into financial difficulty but I see a lot of people putting a lot of hope on higher real estate prices; buying rental properties. It is concerning because it doesn’t take much, whether it’s real estate whether it’s life, whether it’s losing a job, whether it’s death or disability to really change things this just like that. So, I think sometimes people with the best of financial intentions and in a good financial position can get themselves into trouble.

Doug Hoyes:    Yeah, and I think that’s probably a good place to end it, that you have the best of intentions and, I mean, we’ve talked to – I had Rachel Berube on the show talking about real estate and everyone of her clients – she’s a property manager – is putting in money every month to support the condo that they’re renting out. So, you know, “Great, I can rent it out for 2 000 a month but my mortgage payments are 2 500 bucks a month.” So, it’s not an investment in the traditional sense unless real estate prices keep going up. So, I guess that’s where a financial advisor who’s completely unbiased can take a step back and say “Well, okay, I understand exactly what you’ve done but let’s sort of stress test it. What if real estate prices don’t go up, what if the stock market doesn’t go up, what if you lose your job?” I assume that’s a big part of what you do.

Jason Heath:     Yeah, absolutely. A lot of what we do is just providing a sounding board for clients and it’s not our job to say “This is the way the you should invest your money” or “This is how much money you should spend on wine or restaurants or whatever.” It’s more to say “Here are some of the financial factors you should be considering in your life” trying to educate people, help them make smart financial decisions and what might be the best decision for one person may be very different from what it is for someone else. That’s the key with what we do and we’re not biased and trying to steer people in any one direction. It’s kind of nice to have someone who’s not motivated to put you into a certain type of product so that’s where we pride ourselves.

Doug Hoyes:    Excellent. Well, I think that’s a great way to end it. So, how can people find you?

Jason Heath:     Well, website’s I write for MoneySense and The Financial Post and Retire Happy and try to put out great content there for people that are looking to educate themselves about personal finance. Yeah, so I’d be glad to help if we can be of assistance to any listeners out there.

Doug Hoyes:    Excellent, and Twitter, what are you on Twitter.

Jason Heath:     @JasonheathCFP; Certified Financial Planner @JasonheathCFP.

Doug Hoyes:    So, what I will do in the show notes is I will put links to your profiles on MoneySense and Financial Post and so on as well as to your website, objectivefinancialpartners and your link on Twitter and people can track you down there.

Jason Heath:     Yeah, good stuff.

Doug Hoyes:    Jason, thanks very much for being here.

Jason Heath:     Thanks for having me.

Doug Hoyes:    That was Jason Heath, a fee-only or advice-only financial planner with objectivefinancialpartners inc and a frequent media commentator. As always, as I said, I’ll have links to everything we talked about today including links to find Jason if you’re looking for a financial planner and a full transcript of today’s show over at That’s H-O-Y-E-S .com. Thanks for listening. Until next week, I’m Doug Hoyes. That was Debt Free in 30.

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