Profiles – The Value of Advice
The Globe and Mail, Lori Bamber, October 2013
It might seem counter-intuitive, says financial adviser Andrew Guilfoyle, but it is a mistake to assume that a family with a net worth of $5 million or even $10 million has realized financial security. For example, he says, "One family recently sold their business, and they couldn't sleep at night for worry about what they were going to do with their money."
The sense of responsibility and uncertainty about how to manage a nest egg that had taken most of a lifetime to accumulate was affecting their health, says Mr. Guilfoyle.
"They told us afterward that what was supposed to be a very happy time in their life was instead one of the most stressful periods they'd ever been through."
The reason, he explains, was that "they had had a certain income from their business for over 40 years. It was very difficult to adjust to that no longer being the case."
Through a series of long-term planning exercises and re-allocations, Mr. Guilfoyle and his team were able to help the couple reach a point where they were very comfortable with their financial affairs and could begin to enjoy their retirement.
For another high-net-worth family who recently sold a part of their company, Mr. Guilfoyle's team set up a life insurance plan that serves the purpose of a corporate tax-free savings account to leave a legacy for the third and fourth generations.
"The compounded rate of return is greater than they could get in today's fixed income rate environment, on a fully guaranteed basis. But as well, a detailed communication plan has also been implemented, and all three generations are completely aligned with it," he says.
The plan enables the family to achieve their shared significant charitable objectives as well as corporate objectives over the coming decade.
"Many of our clients feel similar to Warren Buffett: they want to leave their children enough to do anything, but not to do nothing. Wealth can be a blessing and a privilege or a curse," says Mr. Guilfoyle. "We're fortunate to be able to assist our clients in having their wealth work for them over multiple generations, to help them achieve their life dreams."
Andrew Guilfoyle holds the prestigious chartered accountant (CA) and chartered financial analyst (CFA) designations, and acts as a personal chief financial officer for wealthy Canadians.
This article appeared in The Globe and Mail in October 2013. It is reprinted with permission.
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