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Slip into something more comfortable and delve into personal finance with Josh Sheluk and Colin White, experienced portfolio managers at Verecan Capital Management. Each episode demystifies complex financial topics, stripping them to their bare essentials. From investment strategies and financial planning to economic headlines and philanthropic giving, delivered with a blend of insight, transparency, and a touch of humour. Perfect for anyone looking to understand and navigate their financial future with confidence. Subscribe now to stay informed, empowered, and entertained.
Verecan Capital Management Inc. is registered as a Portfolio Manager in all provinces in Canada except Manitoba.
Welcome to Barenaked Money, the podcast where we strip down the complex world of finance to its bare essentials with your hosts, Josh Sheluk and Colin White, portfolio managers with Verecan Capital Management Inc.
Colin White:Welcome to the next edition of Bare Naked Money. Josh and Colin here with you. We're gonna talk to you today about how we look after elderly people and how that affects our financial situation. And some some of this is a big topic. So this is some of the issues that you may want to consider or as I like to call this, how Josh is gonna look after Colin one day podcast.
Colin White:So, you know, no pressure, Josh. But, you know, I'm looking at this through the eyes of somebody who needs to be looked after at some point, and you're just with the generation that's gonna do it.
Josh Sheluk:You got 2 kids, Colin.
Colin White:I know. I know. But, you know, kids,
Josh Sheluk:all that are unreliable? I know your kids. They're pretty good kids.
Colin White:Yeah. They are. But, you know, the strength in numbers. You know? If I had one more option, you you'd be it.
Colin White:Okay.
Josh Sheluk:Back up plan. Always good to have a backup plan.
Colin White:Absolutely. So where did you wanna start with this, Josh? You put together, I think, some interesting statistics on aging just to kind of maybe point out to our listeners, how how big the boat is and the number of people in the boat with them, which they may may don't under maybe not understand.
Josh Sheluk:Yeah. I'll run through some of that just so we all have an idea of what the context is here. I think we've all heard these these stories or these data points mentioned about how fast our population is aging or how many people we're gonna have in this cohort or that cohort in in the next 5, 10, 15, 20 years, whatever it is. But here's some numbers for you. So as of 2021, there were over 7,000,000 Canadians aged 65 and older.
Josh Sheluk:So that's a pretty substantial number if I think our population is is around 40,000,000 right now. So that, represented about 19% of the population. And that number is going to continue to grow. I think this is a a pretty steady trend across most developed countries around the world that the older population is growing as a percentage and as a raw number. So they're projecting that by 2031, seniors, so those 65 and older, will make up about 23% of the Canadian population.
Josh Sheluk:So roughly a quarter of everybody, one of the 4 people in Canada will be, considered a senior over the age of 65 by the year 2031. So that that's kinda what we're dealing with in terms of the the population that we need to care for, longer term. It's not to say that everybody over the age of 65 needs care and nobody under the age of 65 needs care.
Colin White:But Good save, Josh. Good save, Josh.
Josh Sheluk:Yeah. It's good save. Yeah. I just had to add that caveat in there. But if we start to think about the raw numbers, it does get a little bit daunting, if you wanna call it that.
Josh Sheluk:And then you start to look at okay. Well, again, not everybody in that that cohort is going to need care, but the numbers also suggest about 80% of seniors over 65 have at least one chronic condition. That could be arthritis. It could be diabetes. It could be heart disease.
Josh Sheluk:So these are, again, kinda aiming more directly at the the cohort of the population that's gonna need a little bit more care. And then even beyond that, about 30% experience, some sort of disability. And, again, that that that doesn't mean that these people are going to need care necessarily. It doesn't mean that the financial situation is is, changing really whatsoever. But you start to get a sense of there was going to there's going to need to be a lot of people that are caring for a lot of other people at some point.
Colin White:Well, I but I think it's important to differentiate here because we're not those people that use numbers to scare. I mean, I think there's a lot of things in motion here. There's many more people choosing to work past 65, live way more active lives past 65 and life expectancy is going up and the health healthcare solutions are getting better for some of those conditions and whatnot. So this isn't a straight line prediction of the doom is around the corner for sure. But it still is you know, this is a meaningful issue.
Colin White:And on a day to day basis, this means more and more people are on one side or the other of this. In this podcast, I think we're gonna try to aim at both sides of the equation. We're gonna talk from both lenses as from an aging, parent perspective and from a a child perspective because I think there's there are some definite points to be made on both sides of that. Would that be fair, Josh?
Josh Sheluk:Well, yeah. For sure. I think you can look at this conversation from 2 perspectives. Either you are the one being cared for at some point down the road, and that's something worth planning for, or you are going to be the caregiver at some point down the road. And that's something that is also worth planning for.
Josh Sheluk:I know that the numbers again are are suggested here that about 70% of the care that that seniors receive, that elders receive is in the form of something informal. So it's not a formal PSW. It's not a nurse. It's not a medical professional. It's a son or a daughter or a cousin or a niece or whatever it is.
Josh Sheluk:So that's pretty significant. That's impacting a lot of people. And and it was interesting. One of my clients who hadn't heard this this term before, but he said, I'm part of the sandwich generation. He's a bit younger than you, a bit older than me.
Josh Sheluk:But what he meant means by that is he's currently taking care of his aging parents and his wife's aging parents and their young children at the same time. So they're sandwiched between, 2 slices of bread or they're they're taking care of both at the same time. It's it's challenging just just from a a time and effort, perspective.
Colin White:And I think it's the first real point I would like to make for those who's listening who are, you know, planning their lives and excluding this as an eventuality because there's many people who sit down with their financial plan and say, okay. I'm in my thirties. We got 2 kids, and this is how life is gonna play out. And they don't necessarily give enough credit to the fact that at some point they could be providing support to the parents. And, you know, there's 2 sets of parents involved there, so there's 4.
Colin White:But 4 seniors that could have a meaningful need of time and or resources. And, you know, it's very seldom. I mean, although I will talk to clients about it when we are planning as to what they feel the likelihood of this is happening. But as with most things, we're really bad at judging, you know, the the percentage chance of something happening. But, you know, if you're not considering the fact that you may need to be allocating time and or money to support your parents at some point, then, you know, you you might wanna revisit that because it's way more common than many people would think for sure.
Josh Sheluk:Yeah. And I think you and and your wife, Renee, you both have seen firsthand the care required for aging parents over the past several years. Right?
Colin White:Yeah. Exactly. So I went through my mother getting sick with cancer and ending up in hospital. And, yeah, that was a big deal that disrupted you know, I'm not begrudging it for a second, but all of my plans went sideways for a number of months because that's what had to happen. And, again, it's not something you need to plan for necessarily, but it's something you need to allow for.
Colin White:You know? You need to and whenever we're talking about planning and expectations, we always talk about leaving slack in the system, you know, so that if a curveball comes at you. Because this is a this is a curveball. It's a funny shape. It could be monitoring.
Colin White:You know, there could be a monitoring aspect to it or it could be a time aspect. Either one of those things could be called for. You know, maybe you're not providing the resources yourself, but you're gonna have to be there and be an advocate. You're gonna have to be filling out paperwork. You're gonna have to be present for appointments, perhaps your power of attorney, the administrative issues that come along with this.
Colin White:So there's many, many different angles to it that, you know, you can't anticipate in any kind of meaningful way. So living a life that allows this for a possibility is is very important.
Josh Sheluk:Yeah. So that's a lot of the sort of the soft stuff, but we're here for the finance side of things. They do call the show bare Naked Money for a reason, I'm pretty sure.
Colin White:So Oh, you're you're bringing me back on topic. Okay. Thanks, John.
Josh Sheluk:No. No. No. All this stuff's relevant. But we're we're trying to to tackle the financial end, today, or at least give some advice on that side of things.
Josh Sheluk:So in your experience, both as a professional and personally, where are some of the financial challenges and considerations coming in, when caring for agent parents or agent family members or agent whoever?
Colin White:Well, typically, in that dynamic, in most cases, the the wealth is with the parent. You know? So the the the most of the complications lie there, and that's where the low hanging fruit is from the perspective of, you know, being able to affect things. So it it can be difficult. No.
Colin White:Sorry. It is difficult to simplify things because you live your life accumulating. You live your life expecting you're gonna be here forever. Then one day, you realize you're not. And, you know, what I would say to the, you know, to that group of people is and and many people automatically go there.
Colin White:Simple is better. You know, if you have a family cottage you're planning on leaving to the family, make sure the family wants it because many times that is not something the family is prepared to take on. And, you know, so have some open conversations about it and everything you can do to simplify your financial world, the, you know, the better it is for everybody. It'll reduce everybody's stress. Now that's very it can be very anxiety provoking for people at that age stage to give up things, and it's for some of them, it's kind of a recognition that the end is near or I'm about to die.
Colin White:So there's all kinds of things that go with that, but if you want to talk about money and talk about being practical, the more liquid and simple things are when these kind of issues come to pass, the easier it is to react and deal with the situation. But, you know, for but the the other side of that is that conversation between the younger and older generation. You know, having an open conversation about everybody's expectations and trying to come to a consensus. I like using the expression everybody gets to write their own movie. So I hope that when I'm a senior and I'm having this conversation, I'm given the latitude to kind of write my own movie and call the shots as much as is possible on my way out.
Colin White:Dignity of choice is the phrase that I've heard bandied about, but that can be very taxing if that puts a burden on the younger generation. And you you do have to balance those two things as I don't think it's it's not gonna lead to the best outcome to be very demanding. It's it's gonna be a much better outcome if everybody has a conversation and reaches a consensus. But family's talking about money and and the delusions of people saying, oh, no. You got 20 more years, mom.
Colin White:And mom's 85. And she's going, no. I don't. Yeah. And the the you know, all all of that plays into it too.
Colin White:Right?
Josh Sheluk:Yeah. Okay. So couple things there to take away. So simple is better when you're planning for sort of long term estate priorities, financially for sure. And I definitely second that.
Josh Sheluk:And communication is key, which we say time and time again, I think this is maybe the most overlooked planning strategy. Like, if if if you're just communicating what your wishes are or where everything is or what the plans are longer term, that's gonna solve a whole lot of problems in itself. So that's another great suggestion, and more people should take you up on that. I guess when I think about as well the financial challenges and considerations, there there's more of a direct cost potentially to elder care. Right?
Josh Sheluk:So you're talking about the state planning. So how how does everything get settled at the end of the day? But before I get there, I might need additional care in my home. I might need to move, quite frankly, to a different home to get additional care. All kinds of considerations on that front.
Josh Sheluk:So when you talk about direct financial circumstances or challenges for those that are aging, what have you seen there?
Colin White:Well, it comes some of that comes back to the advocacy, and it's gonna be difficult on this pod to get too granular because each province is a bit different. You know, all of the home care services provided in Canada are done at the provincial level, and each one has a little bit of a different rhyme to it. But, generally, there's an assessment process that you can apply to it. It's very bureaucratic and it's it's one of those ones that it's an urgent situation, but it's a bureaucracy. So nothing's urgent in the bureaucracy.
Colin White:So that's what I my earlier comment on advocacy. But I think it's important for both sides of the equation to do whatever they can to be as up to speed on the resources available in their community. And this can be different. It is different from province to province and it can be different from one city to another as to what's available because some of it's government, some of it's nongovernment. Yeah.
Colin White:But being aware of all those different programs and make sure you put yourself in a position of knowledge so that, you know, the day that you need to go into a nursing home isn't the 1st day you Google nursing homes in my area. Like, don't do that. Like, that's that's not gonna lead to the most optimal outcome. So make yourself aware of the of the resources. Now that can be anything from Meals on Wheels bringing you meals.
Colin White:That can be somebody comes in and cleans your house a couple times a week or once a week or does your groceries for you. There's lots of different services at lots of different price points, and most municipalities will have a system based on your income as to what you pay. So they're based on ability to pay. But again, there's a whole assessment process there. So none of these things are And
Josh Sheluk:that this is you're specifically talking about the publicly funded retirement facilities or care facilities. Right?
Colin White:And also some of the community groups. Now there's there's an income requirement, like, you know, they're help they're helping under no. So that is part of the equation for some of them. Right? So just be aware of that.
Colin White:Like, if you're going to go asking for something. Like some people get all upset because they apply to go to a nursing home. And one of the things that they do is they do a financial assessment. Well, that's none of your business. Well, it is their business actually because if the province is gonna pay for it, then they're gonna pay for it based on need.
Colin White:So, you know, you're gonna have to go through because the other choice you can make is I'm not going through the financial assessment. They say, well, that's great. It's gonna cost you $6,000 a month. Here's where the money needs to go. And if you wanna take that route, fair enough.
Colin White:You know, you don't need to do a financial assessment. But if you're gonna wanna apply to these programs, oftentimes there's a level of financial disclosure that goes along with it. Mhmm. And people get really kinda caught up in that, and it causes a lot of anxiety. So it's one of those ones that knowing ahead of time, you know, we get caught up in I could speak better to Nova Scotia and to a little bit of BC.
Colin White:I've had a bit more experience there. But there's there is a mandate at the from the social services that they if there's a husband and wife and one needs to go into care, they wanna make they wanna leave a situation where the remaining member can remain in the community because that's better for everybody. Right? So there there are some sensitivities built into the system. It's not as draconian as some people.
Colin White:Like, they're not gonna come in and seize your house to sell your furniture and all that kind of stuff. It is a little bit more human than that for sure. But there is a requirement for financial disclosure. Because typically in most situations, there's 2 assessments. There's a medical assessment that qualifies you for care, and then there's a financial assessment which qualifies you for how much you're gonna pay for it.
Colin White:And those 2 very important steps and can take some time and may need some specialists. And, again, which is why very early on having those conversations. I can circle back on one other thing, an example of communication because I had a meeting with a client and her son and, you know, she was had resources that she was looking to leave to the grandchildren. And she brought her son with her because her son was was her POA. And so we're sitting having a conversation and she was, like, wanting to set up trust funds for the grandkids.
Colin White:And I was kinda confused. I said, well, your son's your power of attorney. Right? Yeah. Is he making good decisions on how to allocate money for the kids?
Colin White:Oh, he's doing great. K. So maybe we don't need to set a formal trust structure up. You know, if you trust him and you've always to trust him because he's your POA, then maybe you just need to have a conversation with him as to how he should allocate the money. And she said, well, I hadn't thought of that.
Colin White:I thought I had to formalize it. You don't have to, you know. And so in that particular case, and it's worked out tremendously well, exceedingly well actually, But in that case, we saved a whole bunch of time expense and we saved for making things overly complicated which life doesn't go in a straight line. So that never ends up better. So that's just one example about how how having a conversation with an adviser who can ask you a couple of questions and maybe challenge some of your assumptions can lead everybody to a better spot because a moderated conversation with a good financial adviser, it can be really, really good at uncovering inconsistencies like that.
Colin White:Because people get something in their head like, oh my god. I have to set these trust funds up. They completely lose sight of what the actual goal was until somebody asks, well, what are you trying to get done? Oh, oh, well, there's an easier way to do that, and you can save them a lot of time, effort, energy, and money and make it more effective.
Josh Sheluk:Yeah. So that goes back to the simplicity concept as well that you talked about Yeah. At the outset. So just circling back on the the the the options that you have for residents or care perspective. So you mentioned some of the public options and kinda how it works, how the assessment is is done.
Josh Sheluk:But you have private options too where you could say, you know what? I don't wanna be in a public facility, period. So I'm just going to pay whatever the the rent is, if you wanna call it that, for, the care that I need from a private facility.
Colin White:And that's sometimes not as out of reach as people think because they they take a look and say, oh my god. It's gonna be 5, 6, 7, $8,000 a month or whatever it is. And not to use statistics because this seems to be a really cold morbid way to use statistics, you're not going to be there forever. So maybe I think the average say is like 2 and a half years or something less than 3 years when you go into assisted living is the average. So if you're selling a home for 1,100,000 and you don't need the home anymore, Well, that's a lot of months this is in private care.
Colin White:Now, again, people get caught up in my goal was that I'm leaving the house to my kids or my grandkids or what have you, and that's perfectly legit. But to take it off the table and say I can't afford those options, that's a stretch. You know? You you can make choices to afford it in some instances that people because people forget, you know, if you're going into lawn care, what do you need anymore? A house.
Colin White:Okay? So you're not gonna be paying property tax. You're not gonna be paying insurance. You're not gonna be paying utilities maintenance, and you're gonna have, you know, a wad of cash sitting in your jeans. So, yeah, I think it's more in reach for some people than they they give it credit for because they just take a look at their bank account and say, I don't have $5,000,000, so this is the out of reach for me.
Josh Sheluk:Yeah. A lot of times when I'm doing financial planning, it's hard to your point to plan for when am I going to need the extra care, when am I going to be in a retirement facility or assisted living of some sort. So if if we can show that the house will be the asset that's sort of the cushion where it's like, okay. If you spend every other dollar and now you need assisted living while you sell the house, and that's gonna fund you for the rest of your life. That's a very comfortable position to be in for a lot of people.
Josh Sheluk:But I think people don't really understand. A lot of people that are going through this planning exercise, they don't really understand what the cost could be if you were to put a range on what you've seen for assisted living from, like, the, lowest cost public option to the highest cost private option. What have you seen?
Colin White:I've seen it, and it it depends on level of medical care as well. But does the sticker price anywhere for 3 to $10,000 a month? So if you have advanced Alzheimer's and you're under 24 hour care with with a lot of medical needs and big urban centers, that can get pricey. I haven't quite seen 10, but I've seen it approach.
Josh Sheluk:Yeah. I I I've certainly in those scenarios that you're talking about, I I've certainly seen 10 around here, for sure in Southern Ontario. And e even a little bit more than that, if you get into, like, again, Alzheimer's, some truly 24 hour care facilities.
Colin White:Yep.
Josh Sheluk:That and and these are nicer facilities with with good quality people and good quality care. But to say it would be in the 10 to 12 range, I don't think you're out of the out of the
Colin White:question. Yep. No. No. I I would absolutely I'd absolutely believe that.
Colin White:But the other the other side of the coin, again, we have to allow human nature in this. Right? Because there's gonna be those, I paid in the Shishta my whole life. Damn it. The government's gonna pay for me.
Colin White:I mean, I put on the voice for effect. So some people are sitting on the money who could afford. In fact, it would be easier if they just went and paid for it, and they would be happier if they just paid for it. Wouldn't be happier because they would leave the government with all that money they gave them all that time and, goddamn it, they're gonna get their piece of it. So, you know, that goes back to writing your own movie.
Colin White:Like, we're talking about the range of possibilities. And quite frankly, when you get to that agent stage, rational thought doesn't often rule the day. Like, you have some ax to grind. You have some particular way you prefer to do things, and it's either all about I have the money and I can buy the convenience or it's my money. You can't have it, and how cheap can I get this?
Colin White:And Yeah. They're gonna play the game different ways.
Josh Sheluk:Yeah. And I I think you kind of alluded to it before, but I just wanna mention there's degrees to sort of this assisted living term that we're using. Assisted living does not necessarily mean you're selling your house and moving somewhere new. You could have some type of assisted living in your current residence, whether it's, to the extent of a PSW or something like that coming by on a daily basis or even just hiring someone to mow your lawn or deliver your groceries. So, again, you get to you there's there's quite a bit of flexibility and quite a bit of control, and you can kinda ease your way into I'm having more help around the house, to the point where, okay, I'm actually having a I'm at a point where I'm selling and or or leaving my residence on my own and and going somewhere else.
Colin White:Yeah. And it's really important, you know, to recognize that money is options. Like, when I'm talking to younger people or I'm talking to people who are planning to spend their last nickel, if you're 40 or 50 years old, you're going, I'm spending my last nickel. That's fair enough. That can be you, but money is options.
Colin White:So you get later in life when you're feeling a bit more vulnerable and you don't feel as in control. You can buy yourself an extra couple years of independence by having the money and resources to purchase some in home care. You know? Like Josh says, low end of the of the spectrum would be, you know, someone to shovel your driveway, mow your lawn, and do your yard work, then you can move up into having a cleaning person come in a couple times a week or getting meals delivered or, you know, having a personal care worker come by, you know, once a month to do things. I mean, if you have money at that point in your life, then you have options and you can actually buy yourself some independence.
Colin White:And at that point in life for people, for many people, that's very valuable. So all those glib people out there say, I'm not gonna need any money by the time I'm 75 because I won't care. I know 75 year olds. They care. You know?
Colin White:So don't don't sell the 75 year old you down the river quite so fast because the 75 year old you may have may be in a situation where they had a couple $1,000 that their situation would be way better.
Josh Sheluk:Yeah. That's for sure. Now I'm not super familiar with the Nova Scotia health insurance plans or drug plans or anything like that for for seniors. I know here in Ontario, a large portion of the pharmaceuticals that those over the age of 65 would need are covered. And now we have this this dental plan for certain segments of the population that's in place federally.
Colin White:Is
Josh Sheluk:it is it something similar in Nova Scotia that
Colin White:It is. Yeah. Each province is slightly different, but they in in my experience, I haven't been in a situation where I was dealing in a province where it didn't have something. Yeah. But typically government aid or government support comes with some kind of financial assessment.
Colin White:And I really wanna drive that home because people get really clamped about their privacy and all that kind of stuff. And worse, they get into the situation, they try to lie, and then they put themselves behind the 8 ball because if the agencies don't cannot trust you or do not believe what you're saying, then you you you've you've caused yourself unnecessary trouble. So just manage your expectations when you go into these. If you're looking for any kind of assistance and you're looking for it at a good price, you're looking for it for free, then there's probably gonna be some level of financial disclosure required.
Josh Sheluk:Yeah. All this discussion about costs, it kinda brings up the idea of, well, how do you cover them? Right? I think the easy answer is while you save and have some assets set aside for things that might come up cost wise. But the other path that you could go down is some type of insurance policy to cover some of these costs.
Josh Sheluk:Is that something that you find yourself recommending often, or is it a little bit more niche
Colin White:y? Well, the challenge with the way you're, I think, basically referred to as long long term care coverage. So the insurance industry a while back launched a product that was a long long term care. But the problem is is that the the the the definitions change over time and what governments will and will not pay for change over time. So it became a very conditional type of insurance and it also came with premiums that weren't guaranteed long term.
Colin White:So they basically have a reset where they can change the premium based on experience because the insurance companies like to work off 100 of years of mortality and they don't have that. And moreover, the shape of people's later years is changing dramatically with medication, and the shape of government is changing to bash that. So it doesn't lend itself to something that's a 100% knowable and guarantiable. So in my experience, it hasn't normally been a strong offering. I put a couple in place, but they were in addition to already having resources.
Colin White:I've never treated them as the answer to the problem. Yeah. You know, they can play a role. If there's some surplus cash flow that you're you're trying to figure out, it can per perhaps form part of the solution for sure.
Josh Sheluk:Yeah. Now they usually have caps on how much they'll pay out on a monthly basis as well. Right?
Colin White:Well, you bought you you're buying a benefit. Like, there's there's no there's no policy out there that's like, hey. 100%, we got you. We'll put you in care whenever you need it. That doesn't exist.
Colin White:You know, you can buy something that has a certain daily amount that will pay under if you meet certain criteria. You know? So there's a medical component you have to qualify for it and then it'll pay a certain amount out. And then there's a an institutional versus private care, you know, delineation within them and stuff. So it's a complicated product.
Colin White:It's a product that the insurance companies have difficulty putting out and and I haven't even looked at one in the last couple of years so I couldn't tell you what the most recent product looks like if it's still out there, but it's not something this is not something that's quantifiable enough to be insurable because there's a really wide range of outcomes. So this is one that really, you know, you need to have. But one of 2 things, either you built enough slack into your plan to deal with something like this or when it happens, all your plans just go out the window and you're in and and just react about. So the other thing I I would I would, you I guess what springs to mind for me is just to be flexible because we have these pictures in our head that things are a certain way. Well, if you get to a certain point in life and things look different, yeah, things look different.
Colin White:You know, with new information, make a new decision, and and don't get too tied up in sticking to something that you thought was important.
Josh Sheluk:Yep. And then there are I think it's worth mentioning as well several government, tax related incentives. If you wanna call them incentives or credits that are available to those that have experienced higher expenses due to assisted living or long term care medical expenses or something along those lines. There's tax credits available for those with medical expenses. And Mhmm.
Josh Sheluk:Often a lot of the assisted living, maybe not a lot, but a portion of the assisted living expenses can be considered a medical expense for medical care. Yep. So there's some tax benefits there that, are worth thinking about as well. And then I think one thing that's often underutilized, at least I found many opportunities to suggest an application for the disability tax credit with clients. A lot of people think, oh, I need to be, like, truly physically disabled where I can't walk or something like that to be eligible for something like this, but it's a much broader definition of disability that the tax code takes for it.
Josh Sheluk:So that's a pretty significant benefit that a lot of people are overlooking today, I believe.
Colin White:Well, it's you know, but it also brings to to to to light that, you know, one of the things you're dealing with here is increased complexity. So maybe you've done your own tax return for the last 20 years. We turn a corner and all of a sudden there's all of these things that have come up and maybe it's worthwhile paying to have somebody do your taxes now because it may have exceeded your ability to keep track of things because these things do change on a fairly regular basis, and there's nuances to look for. So it's it's not as simple as just, you know, getting your t four from work, your RSP slip, you throw it in a tax return and you're done. There can be a lot more to this.
Colin White:And the stakes can be merge material. Like, you you can have a situation where it's plus or minus 1,000 of dollars. So it's just another one of those complexities maybe that creeps up on you and your confidence for having done your tax return on your own for the last 20 years gets in the way of, hey. Wait a second. I think I'm getting out of my depth here.
Josh Sheluk:So you're saying that $150 for a professional to do a tax return could be worth it?
Colin White:I would most certainly think that that would be worth the savings and aggravation and for the peace of mind. That wasn't very subtle, Josh.
Josh Sheluk:I try my best. The reason I joke about it is because we've seen so many scenarios where people come in and say, you know, I had H and R Block just to throw somebody under the bus, do my tax return. It was $60. Or I did this on my own, and we look at it and say, this is this is wrong. Like, you you've cost yourself a 1,000 plus dollars by trying to cheap out this way.
Josh Sheluk:So sometimes it's doable. Other times people are overlooking something and, can be very significant, the savings that, that they're overlooking.
Colin White:Yeah. And what's germane to this topic is don't underestimate the complexities that creep in on the tax side. You know, even if you were adequately handling it up for a certain point of a certain amount of time, don't count on it staying the same. It's gonna be more complicated.
Josh Sheluk:How often are you recommending that clients or anybody really is reviewing their wills, power of attorneys, and documents like that that are really down the road extremely crucial to having things managed financially and otherwise in a quarterly fashion?
Colin White:I mean, it's different for different people. I mean, I bring it up very regularly when I'm talking to clients and we record. You know? And if it just comes to top of mind that, know, do you think what's in your will is still current? You know, if that thought crosses your mind, like, a once a year basis, that would be more than enough.
Colin White:Probably what if something materially changes in your life, right, like the kids leave home or you sell your house or you change the shape of your estate, those are good times to go back and look at it. But other than that, every year or 2 is plenty. And it's not necessarily you gotta pull it up and read it. But just remember, like, who was my executor and how's and this is where I always advocate for simplicity. Sell everything, split it in 2, and you're done.
Colin White:That will probably doesn't need to be reviewed as much as one that names certain properties to certain people and and, you know, put some guardians for kids and, you know, there's a trust fund. And, you know, the more complicated it is, the more more often it should be thought about. But please, for the love of God, if you give any kind of care for the next generation, don't make it too complicated.
Josh Sheluk:And tell people where to find this stuff too. Make may
Colin White:Show show your love by keeping it simple.
Josh Sheluk:Yeah. The not only for the documents be simple, but don't have 15 bank accounts at every credit union in every province of the country. That gets to be a mess to try to deal with.
Colin White:This is sounding like Josh is triggered a little bit here. I think we've we've we've we've hit a different
Josh Sheluk:Not not personally, but we did have a client pass away last year. And I asked him, about this before he passed because he had what was most likely a terminal illness at the time. And he kinda shrugged it off, and then his wife called me and said, I'm finding accounts and loans and stuff all over the place that I didn't know existed after he passed. And so I'm calling companies that I said, I've never talked to you before, but I'm calling on behalf of so and so. I'm trying to see if there's still an asset or a liability here.
Josh Sheluk:Can you tell me? And the the crazy thing is they won't. They they can't tell you anything. I and there is one thing I I I called the company, and I said, look. This was at one point, there was a loan here.
Josh Sheluk:I know that for sure. And at one point, the former adviser in this office was on record of that loan. Here's the loan number. Here's the individual's name. Blah blah blah.
Josh Sheluk:Can you tell me if there's still any amount outstanding? No. Okay. So how are we gonna find out if we owe you money, if the estate owes you money? Weren't very helpful with that.
Colin White:The the the this is where wisdom kicks in. Like, if you don't want me to pay you back, I guess this is the end of the conversation. I can say I've tried. I'm not upset about this.
Josh Sheluk:But you can't say that. You can't say because at some point, they're gonna say, well well, you should have paid me back. I'm gonna sue the estate or whatever it is.
Colin White:Maybe.
Josh Sheluk:Maybe. It's not
Colin White:gets rid of all the time.
Josh Sheluk:Right? I I guess so. Yeah. I guess so. But, yeah, that that's the type of frustration that can can arise for these survivors that are trying to settle this stuff if it's not done in an organized orderly fashion.
Colin White:Yeah. But, listen, you know, in defense of the guy who was the terminal illness, maybe he just didn't give us crap. You know? Like, this is like, I'm done. I've looked after all you all my whole life.
Colin White:I've given you everything you ever wanted. Figure this shit out. I'm I'm a peace out. Right? Alright.
Colin White:If that if that's if that's the movie you wanna write, then that's that's the movie you write. Just get, you know, this side down tattooed on your forehead so the world can kiss your ass and be done with it. Okay. Okay.
Josh Sheluk:Yeah. You do get to write your own movie, but that movie is impacting a lot of other people in your orbit.
Colin White:So Oh, I know. I know. And, you know, I'm being a little facetious with it. But I mean, again, at the end of the day that's why communication is important. I think it would be it would be tough for someone to look at the next generation and say that out loud.
Colin White:You know? So, you know, if you put them in the same room and they go, oh, okay. Fair enough. Here. Here's all you need to know to sort this out.
Colin White:I'm not sorting it out, but I'll let you know what it is. I mean, that's normally, that's not too big of a bridge, to get over. So
Josh Sheluk:Yeah. So for wrapping it up and summarizing all this, it's I think the the moral is there can be very material impacts to your financial situation. Very material costs. If you're going through an elder care assisted living type of situation, these costs and burdens are gonna fall on all kinds of people, not just those going through the the process of finding that assisted living or needing that elder care. It's gonna fall on multiple generations and multiple people in your orbit.
Josh Sheluk:And I guess if we're given a few takeaways, Colin, it's be simple, be organized, be communicative. Any other things that you should be if you're planning for this?
Colin White:Use use an adviser because a moderated conversation with family about money is without question more effective than having a conversation about money without a moderator.
Josh Sheluk:Are those conversations not a little bit scary sometimes for you as the moderator?
Colin White:Terrifying. Absolutely terrifying. But it's it it does lead to a better outcome. People are are are a little afraid to to be their true selves maybe in in in front of a stranger. So maybe some quieter some quietness can persist and allow a real conversation to happen.
Colin White:So this is one of those good times to use an adviser, have them in the room, have a multigenerational conversation in front of an adviser.
Josh Sheluk:Yeah. We embrace the terror.
Colin White:That's right. Feel the fear. Do it anyway.
Josh Sheluk:Yeah.
Colin White:If you're breaking a sweat trying to figure out what your financial adviser is talking about, you're not getting the service you need. You probably hate trying to get an answer from them, but you also think moving your accounts will be a headache. And it might be. But working with don't rock the boat wealth planning dot com or dot RU isn't exactly stress free, is it?
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