Find a Wealth Manager in Canada

Work with the Best Wealth Manager for You

Written by Tiffany Woodfield, Associate Portfolio Manager, CIM® CRPC® and John Woodfield, Portfolio Manager, CIM® CFP®

Is it time to find a wealth manager in Canada who can help you with your specific wealth management needs?

When planning your retirement or "work-optional life", you need to partner with a wealth management team with expertise in precisely what you need. For example, if you are a wealthy retiree, you need to seek an experienced portfolio manager to set up an estate and financial plan.

If you are a professional at the peak of your career, you will need to understand strategies to invest and minimize the tax impact. If you also have cross-border needs because you hold assets in Canada and the U.S., you will need an advisor licensed in both countries. Dual licensing is necessary for your wealth manager to advise on tax-deferred investments such as IRAs or Roth IRAs.

TABLE OF CONTENTS

1. Wealth Management Services
2. Wealth Management for U.S. Citizens in Canada
3. Wealth Management for Canadians and Residents
4. Wealth Management for Canadians in the U.S.
5. Private Wealth Management in Canada
6. Wealth Management at Big Banks such as TD and RBC vs. Independent Firms
7. High Net Worth Wealth Management in Canada
8. What Is the Best Wealth Management Firm in Canada?
9. Which Bank Has the Best Wealth Management in Canada?
10. Is It Worth It to Pay a Wealth Manager?
11. How Much Money Do You Need to Be a Wealth Management Client?
12. Summary of Key Events>

Wealth Management Services

At SWAN Wealth, we are the quarterback for your wealth management plan. It would help if you had an advisory team that meets your needs and has the necessary qualifications and experience to be of service to you. SWAN Wealth Management and Raymond James Ltd. consist of financial planners, portfolio managers as well as estate, tax services and licensing teams based in Canada and the U.S. This combination of licensing, qualifications and the years we have worked with clients allows us to provide superior wealth management.

When choosing a wealth management team in Canada, you should look for this array of qualifications and services.

In this article, I will cover the services you should expect when working with a wealth management firm and the common questions people ask about wealth managers in Canada.

If you need urgent advice or assistance with a cross-border move, please click below to schedule a call with one of SWAN's cross-border experts.

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Wealth Management for U.S. Citizens in Canada

U.S. citizens and Green Card holders in Canada often have U.S. tax-deferred plans such as IRAs and Roth IRAs. With a licensed cross-border advisor, these can be actively managed and held on a tax-deferred basis while you live in Canada.

While there are other options for dealing with IRAs and Roth IRAs, they are often not as favourable. You could cash out your plan, which would mean full taxation on the proceeds. You could move the plan to a Canadian RRSP, but this is rarely a tax-neutral choice. Or you could potentially keep the account with the U.S. brokerage firm. When you keep your account in the U.S., it is essentially frozen. You are also at risk of getting a letter from your brokerage firm stating you have 30-60 days to find a new advisor as they cannot help non-residents. 

In addition, there are complexities for a U.S. citizen living and investing in Canada. If you aren't careful, it is easy to fall into common tax traps. Some of these tax traps include investing in what your accountant considers to be passive foreign investment companies (PFICs). PFICs include Canadian mutual funds, Canadian ETFs and Canadian money market funds. Also, it is crucial to understand that Canadian trusts do not work the same way as U.S. trusts. In Canada, estate planning as a U.S. citizen is more complex, so you'll want to ensure you understand the tax impact of all your decisions.

Wealth Management for Canadians and Residents

Residents of Canada, no matter what country they are from, may be able to invest in Canada and use a variety of tax-deferred plans such as RRSPs, RESPs and TFSAs.* Canadian residents can structure regular investment portfolios through SWAN Wealth Management. SWAN and Raymond James will issue appropriate tax receipts for the CRA and the IRS.

Some of the biggest questions we get regarding wealth management when someone is close to a work-optional lifestyle are:

1. How much money do I need?
2. When can I stop working and never run out of money?
3. Where is it best to draw money from first?
4. How can I make sure my legacy is protected?
5. How can I pass along appropriate assets to my heirs? Is there a strategy around this that minimizes tax?
6. What happens if something happens to me?
7. Can I give to charity?

When someone is at the peak of their career, the questions usually are:

1. What are the best tools to save for the future?
2. How can I save tax on investments?
3. What do I do to protect my family?
4. When is work optional?
5. What is the tax impact of my decisions?

 

The answers to these questions will be specific to your situation. Please schedule a call if you'd like to begin optimizing your investments and solidifying your wealth management strategy.

*Please note that TFSAs and RESPs are still considered taxable accounts for U.S. citizens, so you will need to speak to your accountant before you put money in these accounts. 

Wealth Management for Canadians in the U.S.

When Canadian citizens move to the U.S., they can maintain their RRSPs and use U.S.-based tax-deferred plans such as IRAs and Roth IRAs. 

When you become a non-resident of Canada, you usually don't have to pay taxes and file a tax return to Canada. However, if you receive income from sources in Canada, you will have an obligation to report it to the Canada Revenue Agency. In addition, you may owe tax. For example, if you have a rental property in Canada while you are living in the U.S., there will be withholding taxes you must pay in Canada. Likewise, when you take money out of a retirement account while living in the U.S., Canada will also withhold taxes.

When you work with a cross-border financial advisory firm, your team will know how to invest and create an income stream based on your country of residence. They will also understand what types of investments can be transferred easily back to Canada and the U.S. This is important as you may want the flexibility to move back.

In addition, it is essential to know if you can invest in Canadian and U.S. currency on both sides of the border, as this isn't commonly a service offered at most firms.

Private Wealth Management in Canada

The concept of private wealth management can be confusing to clients. Many packaged products, like mutual funds, offer a basic way to diversify and have professional management. Individual private wealth management involves having a portfolio manager who tailors your investments to meet your needs. Your wealth manager will look at your entire financial picture and create a plan considering taxation, estate planning, insurance, and your values, all in addition to your goals.

If you have over $2 million in investable assets, you may find it beneficial to work with a team of portfolio managers. They can create a diversified portfolio that suits your particular situation.

 

Wealth Management at Big Banks such as TD and RBC vs. Independent Firms

There are many investment firms in Canada, but they can be divided into two camps: bank-owned or independent. The bank-owned firms are large and relatively rigid, while independent firms can also be large but tend to be more flexible.

Most independent firms are 100 per cent focused on asset management, which is only a small part of the major banks' business. Thus, one could argue that independent firms' interests are more aligned with the investment needs of their clients.

At an independent firm, the advisors focus on managing the assets for clients rather than introducing the clients to other banking arms. In other words, your advisor at an independent wealth management firm isn't trying to sell proprietary products or a second mortgage.

In recent years, independent firms have attracted top advisors from banks who feel that the independent structure is a better fit for their affluent clients. Clients have access to all the critical services such as estate planning, financial planning, tax consultation and wealth management and aren't feeling the pressure to buy any proprietary products.

High Net Worth Wealth Management in Canada

High-net-worth individuals are exposed to a greater risk of high taxation. The more you earn and the greater your wealth, the more critical tax planning strategies become.

For wealthy individuals and couples, financial planning needs go well beyond simply investing. We have found at SWAN Wealth that our clients with assets of $5 million or more in investable assets require advice on using trusts, corporations, insurance, gifting strategies, and how to transfer wealth efficiently. Taxation is at the core of most decisions because keeping your wealth is an integral part of building your wealth.

In addition, there are often cross-border concerns and a desire to donate to charity. 

Common Questions about Wealth Managers in Canada

What Is the Best Wealth Management Firm in Canada?

The best wealth management firm in Canada is the one that meets your needs most effectively. However, it is challenging for a client to assess what the best firm is since most people don't have a rubric with which they can easily judge a firm.

It would be best to consider your needs and what is most critical to you. While this may be easier said than done, my advice is to check out the firm's website to see if you get a feeling for its expertise and values. Determine if the language they use is a fit. Next, schedule an introductory meeting to ensure they have experience working with clients like you.

If you are satisfied with their expertise, then schedule an appointment with one of the advisors to have your critical questions answered. While most wealth management firms have many financial advisory teams, you need to understand these teams are run differently and likely specialize in different areas.

It is important to understand whether you like and trust the firm and your wealth management team within the firm.

Which Bank Has the Best Wealth Management in Canada?

Banks are just one part of the investment landscape in Canada. Every bank and every independent firm use similar systems and have access to similar investments. What makes the difference in quality is the advisory team. You'll need to assess the prospective advisory team first. High-quality advisors can easily move their practices from banks to independent firms. This flexibility means they generally end up at a firm that offers the best mix of services for their high-net-worth clients.

Is It Worth It to Pay a Wealth Manager?

Whether or not it's worth it to pay a wealth manager depends on your situation. Some people like to do their money management and enjoy the challenge of keeping up with investments, taxes, and maintaining the course in an ever-changing investment market.

But in my experience, most professionals would instead focus on their work, retirement, lifestyle or families. The benefit of having a wealth manager goes far beyond investments. A good wealth management team will help you with financial planning, tax planning, estate planning and charitable donations.

I like to think of a wealth manager as a coach supporting you and providing advice so you can get to your destination, whether that is a sum of money, work-life balance or a dream of giving back.

Suppose you consider going on a holiday to an unfamiliar area in another country. Imagine you were to get a map and hope for the best. Your trip would likely be stressful. You might get lost and even miss the goal of your trip.

But if you hire a guide, they will be a resource at every step. Your guide will get to understand you and your values. They are motivated and equipped with knowledge and experience to get you to your destination.

A significant and often overlooked role of a good wealth manager is to help you avoid major pitfalls. Making a catastrophic error that costs you a substantial percentage of your wealth can be avoided when you work with a good wealth management team. One such pitfall would be selling investments during a temporary downturn. Selling when markets are down is a common issue that plagues investors who don’t work with a wealth manager that is there to prevent emotional decisions and keep you on course.

How Much Money Do You Need to Be a Wealth Management Client?

There are various wealth management options for investors, each of which has a minimum. For example, some wealth management firms may require that you have $2 million or $10 million in investable assets, while others may only require $100,000. 

Bank branches will take almost all clients, and the products they offer are generally either fixed income or mutual funds.

Newer advisors building their client list typically have minimums, but these can be very low. While seasoned portfolio managers typically focus on providing a high level of service, so they have higher minimums.

At SWAN Wealth, our minimum is currently $2 million in investable assets. However, most of our new clients come to us with substantially more than this amount.

If you are looking for a wealth management firm in Canada, we encourage you to schedule an introductory call here. At SWAN Wealth, we specialize in Canadian and cross-border wealth management. Click HERE to schedule an introductory call.

Summary of Key Points:

• With high net worth comes high potential taxation and an increased need for planning strategies. For this reason, working with an excellent wealth management team is critical.
• As a U.S. citizen living in Canada, it is essential to get advice from a firm with expertise in working with clients similar to you.
• There are key differences between banks and independent firms. Focus on finding a team you trust and have experience working with people like you.
• It is crucial to understand whether hiring a wealth manager is worth it. If you have $2 million or more in investable assets, working with a wealth management team is likely the best choice.

 

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Next Steps

If you’re a Canadian resident or are planning on moving to Canada and need help with moving and optimizing your investments, estate planning, wealth management and portfolio management, please get in touch. At SWAN Wealth, we specialize in Canadian financial planning, cross-border financial planning, and cross-border wealth management.

About the Author

Tiffany Woodfield is an Associate Portfolio Manager licensed in Canada and the U.S., and the co-founder of SWAN Wealth Management, along with her husband, John Woodfield. Tiffany advises clients who live in Canada and the United States and want to simplify their cross-border financial plan, move their assets across the border, and optimize their investments to minimize their tax burden. Together, Tiffany and John help their clients simplify their cross-border finances and create long-term revenue streams that will keep their assets safe whether they live in Canada or the U.S.

John Woodfield is a Portfolio Manager, Financial Management Advisor (FMA), a Chartered Investment Manager (CIM), and a Certified Financial Planner (CFP). In 2007, John was inducted as a fellow of the Canadian Securities Institute (FCSI). As a portfolio manager and CFP®, he works with clients across Canada. John’s clients are families, individuals, and business owners who understand the importance of a comprehensive wealth and investment plan driven by the lifestyle they want to lead.

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