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COVID-19 and Your Investments

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You cannot turn on the media without hearing news of the Coronavirus. World markets have seen quite a bit of movement as fears of the virus spread. While we can’t specifically say when this volatility will end, we can tell you that the Watermark team excels at navigating clients through market turbulence. So, we’ve compiled 5 tips to help you steer through COVID-19 and your investments.

Keep your head

It’s so easy to get anxious with all that is happening around the world right now. While it’s important to check in on the news periodically, disconnecting is also important. In December we shared 4 tips to remain grounded with you. Keeping your head during these trying times is difficult. I think #2, Focus on your Health, is especially important right now.

Remember that market turbulence isn’t new

In May of 2008 Stewart Istvan, Chuck Magyar, and David Lyon banded together to build what’s become Watermark Wealth Management. We’ve weathered these four instances of market turmoil together, we can get through this, too.

  1. The Great Financial Crisis (2008–2009)
  2. European sovereign debt crisis (2011)
  3. Oil crash of 2015–2016
  4. Q4 2018 interest rate panic

Did you know that these 4 periods share one thing in common? They were followed by dramatic rebounds.

Our friends at iA Wealth have created a report – The Storm Before the Calm. It shares some data-driven perspective on COVID-19 and your investments, and outlines why it makes good sense to keep a positive outlook. It also reminds us that when markets run into turbulence, we need to take a step back, tune out the noise, and regain our footing.

Invest periodically

A great way to respond to the market turbulence we’ve been experiencing is to start Dollar Cost Averaging – investing a fixed amount of money at regular intervals. Most of us get paid twice a month, why not set up an automatic withdrawal from your bank account on the day after you are paid? Putting your savings on repeat lets you ease into the market, ironing out the ups and downs of fluctuating prices.
Franklin Templeton created the below charts that outline the benefits of Dollar Cost Averaging:

Dollar Cost Averaging During a Rising Market

In a rising market environment, your investment is worth $1,819, from 79 units purchased at an average cost of $15.17. That’s less than the average unit price of $16.67 over the same time period without using DCA. Over time, you pay less per unit, while your investment continues to grow.”

Dollar Cost Averaging During a Volatile Market

In a more volatile market, you have purchased 244 units at an average cost of $4.93 and your investment is worth $1,949. Over time, your investment value increases using the DCA strategy.”

It is NOT the end of the world

There’s a quote from Anne of Green Gables that I remember in trying times – “the sun will go on rising and setting whether I fail in geometry or not”.

Our friends at Dynamic Funds shared the below chart with us in 2016. It’s amazing how many times we’ve turned to it for solace during unpredictable periods since then. You may want to have a look and then realize that no matter what COVID-19 brings, the sun will come up tomorrow.

It is NOT the end of the world
Source: Zyblock, Myles “U.S. Election Results: A Trumpocalypse?” Dynamic Funds 8 Nov. 2016.

Stick to your plan

When you create a financial plan you figure out two numbers; how much you need to save every year, and what rate of return you need your investments to achieve. Keep focused on your number, and it will be easier to filter out the noise. Meeting with your advisor periodically to make sure you are on track to achieving your wealth goals will help you sleep more soundly.

As we navigate this new world it’s important to stay connected. Know that we are here for you. Give us a ring if you have questions about COVID-19 and your investments, your financial plan, or if you are simply feeling anxious about how COVID-19 is affecting you. We’re here.

Watermark Wealth ManagementCOVID-19 and Your Investments
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Watermark Wealth Management is here for you

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Watermark Wealth Management is still here during these difficult times…

As we enter a new week of unknowns, we want you to know that the priority of your Watermark Wealth Management team remains the same – committed to you as our valued client.

We are here to help and want to keep you informed of our plans to do just that.

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Financial Well-Being of Canadians

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Ever wondered how your finances rank against other Canadians? The Canadian Payroll Association (CPA) recently published an 11-year study on the financial well-being of Canadians.

As I’m reading the study, all I can think about is David Chilton’s book, The Wealthy Barber. What a great title for a book, eh? That simple title lets you know what this study is basically telling us, it’s not how much you earn, but how much you save.

The study shows that the financial well-being of Canadians has room for improvement. It provides insights into how much (or little) Canadians save. I know we’re financial nerds here at Watermark Wealth Management, so perhaps our interests are a bit skewed, but the findings were really interesting! For instance, we’ve all done it. Heard the salary of a friend or neighbour, and thought:

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Delivering Meals on Wheels

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For the 4th year in a row your team here at Watermark Wealth Management will be volunteering with the good folks at Dixon Hall Neighbourhood Services. The entire team (Stewart, David, Chuck and Kate) will be participating in the Meals on Wheels program December 18th. In lieu of sending holiday cards to you, our wonderful clients, we’ll spend the day delivering meals to those that need some additional help.

Watermark Wealth ManagementDelivering Meals on Wheels
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4 tips to remain grounded

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The world can be a busy place and carving out time to simply exist can be difficult. Can we try to shift the focus and be better off? We sure can. We have some tips to share on how to remain grounded.

Can you believe it? November is here! How 2019 seems to have flown by!

Halloween has now come and gone, we have all eaten way too much candy (perhaps) and now we are going to be subjected to 2 months of dizzying pressure to buy gifts for the holiday season. Christmas and Hanukkah…all rolled into one huge, pressure-filled, buying frenzy, celebration.

Can we avoid this? Can we remain grounded and not be swept up into the commercialism of this upcoming holiday season? Here are a couple of tips to keep in mind between now and the end of the year:

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Allowance in a digital age

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Should you be paying your child’s allowance digitally? We explore cash vs. cashless technology and how best to teach your kids about money using their allowance.

According to an analysis by Forex Bonuses, Canada is the top country for embracing cashless technology. And the trend goes all the way down to our kids. A 2018 study by TD found that “nearly 68% of parents said their children are more or just as comfortable using digital payments as they are handling cash”.

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Break these 10 bad investing habits

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Bad investment habits can hurt us financially, so we’ve come up with a list of 10 bad money habits we think are worth noting. Hopefully you don’t see yourself in any of them, but if you do, maybe you’ll think twice next time and recognize these in yourself. I think in time we can all break these 10 bad investing habits for better investment results.

Reaching for returns

A risk discussion is one of the most important conversations to have with your advisor, both when you first open your account, and when you experience significant life events.
Investors get into trouble when they go outside of their comfort zone. Investments that provide remarkable positive returns in rising markets can also have great dips in falling markets. When markets are rising, you can feel like a genius, but when markets take a tumble, the losses can send you on an emotional roller coaster. This often causes investors to panic and sell into a dropping market – not ideal for long-term investing.

Watermark Wealth ManagementBreak these 10 bad investing habits
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Are you retirement ready?

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Are you retirement ready? We’ve compiled 8 items to consider and review with your advisor 1 to 2 years before you officially retire.

Know where you stand

Meet with your advisor one year before retirement. Bring statements for all of your assets (and your debt) in order to create a comprehensive retirement plan. Don’t forget your insurance policies!

In the perfect situation you would bring your budget, having tracked your expenses down to the dollar for an entire year. This way you won’t be guessing how much you spend – you’ll have a true reflection of your annual expenses. Dynamic Funds crafted a Retiring Budget worksheet that allows you to compare your current expenses with your expected retirement expenses.

Watermark Wealth ManagementAre you retirement ready?
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