Martha had decided to go back to work as a part-time teacher later in life. She had come through some serious surgery and decided to go for it, life is short. Three years later, her husband was diagnosed with cancer and shortly after in 2000, Martha was widowed.
Martha’s husband had been an executive at Sunlife and he took care of all their personal finances. The details regarding their investments was just something they never discussed, but one thing was for sure, there was never a doubt that Martha would be looked after.
After her husband’s passing, she was the one to meet with her husband’s investment advisor. She discovered that since her husband’s passing, their advisor had invested her husband’s investments into high risk investments. Without any discussion with Martha, this guy had gone ahead and rolled the dice and then told her, “that’s what your husband would have wanted you to do”.
At the time, Martha didn’t know a thing about investments and she trusted him. After all it was her husband the finance executive who had hired him. Six months later Martha’s $900,000 was down to $200,000. The advisor had lost $700,000 of her money in high tech speculative stocks. Martha realized she was in trouble and that it was time to reach out for help.
To recoup the $700,000 that her husband’s advisor had lost
To own her own home and not rent anymore
To generate an income to supplement her CPP pension income
To be independent and secure and not worry about money
Martha met with Vanessa in 2001 and they talked in great detail about her situation. She told Vanessa she was renting a penthouse apartment on Queen St. East, that she received a survivor’s pension from CPP and a small pension from her husband’s pension. (He had taken his pension out as a commuted value when he got ill. He hadn’t shared this with Martha, but without question he had the best intentions.)
Vanessa evaluated Martha’s situation after talking with her about her wants and needs, and her risk tolerance. She began teaching Martha about the different types of investments and about why they were in her portfolio. Vanessa started to manage Martha’s initial investment of $200,000 in 2001.
Plan of Action:
Vanessa told Martha that her investments had to grow for about 8 years to recoup the losses. They met regularly and re-balanced and changed the portfolio to meet the changes of the markets while meeting Martha’s goals.
Her portfolio was continuously changing, holding mutual funds, bonds, ETF stocks or GICs at different proportions at different times, depending on the current investment strategy that would move her portfolio forward.
Vanessa advised Martha she needed a part-time job, to save and supplement her current income. Martha took a position as a part-time teacher for the Toronto School Board, the same board she had started with 3 years before she was widowed.
Martha lives in the condo she bought on Queen St in the Beach area of Toronto using a down payment of $150,000 from investments in 2007
She has taken an income of $2000-$4000 a month for the last 7 years since 2010, and continues to do so. She has taken $250,000 for income from investments to date.
Her investments are at $763,000 as of August 2017