Financial Adjustments A paradigm shift n 2003 I attended a financial conference in the United States that changed the way I think about financial planning and building wealth. As I listened to the financial strategies being presented that week some- thing clicked. Could the people presenting really be on to something? As they proceed- ed to unveil what they called an innovative wealth replacement strategy, I became in- trigued. As I began to understand fully what was being proposed, I realized the impact this concept could have on my own personal financial situation, and also that of my clients. Upon returning from that conference I found myself spending many more hours I trying to understand why this wealth-building approach was so powerful and different from anything else I had learned. It was certainly contrary to the traditional plain vanilla advice provided by most financial institutions and investment companies. SO WHAT EXACTLY HAPPENED THAT WEEK? To my surprise and good fortune, I learned a life-changing wealth strategy that has since benefited my own family – increasing my overall wealth and future retirement income by more than 35 per cent – and many of my clients and friends. I made a change to my financial plan that will: 1. Protect my investment portfolio from inevitable stock market dives and volatility such as we just experienced in the financial crisis of 2008. Paul Philip, CFP, CLU and Nancy Philip,CFP,CLU are a dynamic sib- ling team who have been advising hundreds of chiropractors across Canada since 1992. Their firm, Fi- nancial Wealth Builders, is located in Toronto, Ontario. To learn more about building your wealth, visit their website at www.fwb-inc.com or contact Paul or Nancy at 416- 497-0008. 2. Allow me to spend my investment principal in retirement instead of living off only interest, as is most common for many in their retirement years. This strategy enables me to safely enjoy a higher income while I am around to benefit from it. 3. Increase my retirement savings simultaneously. 4. Erase the fear that many of us have, that my money will run out before I die; and 5. Provide a sizeable, tax-free, guaranteed death benefit to pass along to my wife and children and ultimately my children’s children. This wealth replacement strategy is actually a very creative use of an old, conservative financial vehicle, the original purpose of which was to protect, financially, from prema- ture death, act as income replacement for a surviving spouse, provide instant liquidity to pay for debt and taxes and fund children’s educations, buy/sell agreements and other important obligations. The concept centres around guaranteed permanent life insurance. When integrated within a retirement plan, this effective tool will serve as a wealth replacement strategy that will provide me with three key benefits while I am alive: flexibility, financial freedom and peace of mind. Prior to hearing about this innovative strategy utilizing permanent in- surance, a common insurance strategy was to “buy term and invest the difference.” How- ever, drawing from several years of experience in the field, I have seen firsthand how mediocre, at best, the results of this concept actually are. The reason for this mediocrity is that most people don’t invest the difference – they spend it. (Anyone who actually did “invest the difference” in the last 10 years probably wishes they hadn’t, after 2008 hap- pened.) The biggest challenge with term insurance, however, is that the policy itself usu- ally expires or is left to lapse, due to very high costs as one gets older, leaving no benefit 28 • CANADIAN CHIROPRACTOR | JUNE 2010 www.canadianchiropractor.ca This edition of Financial Adjustments is by Paul Philip. Nancy Philip, CFP, CLU Paul Philip, CFP, CLU feature
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