A 42 year old married client with two children (ages 3 and 11) and an annual income of $92,000 has come in for some financial planning advice. His wife is a stay at home mom. He recently immigrated to Canada (4 years ago). He has basic drug and paramedical employee benefits with his computer programing firm for which he has been employed on a full-time basis for the last 3 years. His company being a small independent firm does not offer short or long term disability or critical illness insurance. He just purchased a new home with monthly combined mortgage and property tax payments of $1,450.00 monthly. 1. He is wondering what would happen if he got sick for an extended length of time as he does not have additional any coverage? a. Explain how much he could receive through employment insurance, for how long and what the qualifying period would be and discuss why he may want to purchase additional insurance and where would he get this? Recommended resources: https://www.canada.ca/en/services/benefits/ei/ei-sickness.html https://www.canada.ca/en/financial-consumer-agency/services/insurance/ disability.html#toc0 b. What if he becomes so ill, that he cannot return to any work whatsoever? What is the definition of disability within the meaning of CPP? How are benefits calculated and what are the typical and average annual amounts for CPP disability benefits that he may qualify for? Recommended resources: https://www.canada.ca/en/services/benefits/publicpensions/cpp/cpp-disability- benefit.html 2. He and his wife were childhood sweethearts. He says they are the best of friends but not so much lovers anymore. They have been married 22 years. His wife has a degree and worked before coming to Canada, but has not worked since coming to Canada and she has limited English skills. She has been dependent financial for the last 4 years and is the primary caregiver to their children (one of which was born in Canada) and they agreed to this before moving to Canada. She has sacrificed her career to support his endeavours and expanding their family in Canada. He states that he has no immediate plans to separate or divorce but is wondering about some general financial advice. After advising him that you are not giving legal advice and recommend that he seek this out ( and recording that you have done so!) . . . a. What is the basic level of child support that he may have to pay as a non-custodial parent? Recommended resources: http://www.justice.gc.ca/eng/fl-df/child-enfant/look-rech.asp or https://www.childsupportcalculator.ca/ontario.html#calculator (one point) (note: spousal support may also be payable . . . the amount differs if there is child support attached. To give you an idea there is also a spousal support calculator available online https://www.mysupportcalculator.ca/ remember child support can also go up from the basic amount if your child requires extra support (dental, tutoring etc.)) Divorce can be financially devastating. b. His father is ill and he is in line to receive a substantial inheritance. What general advice would you give him especially if he feels he may divorce or separate in the future? Recommended resources: Family Law E-lesson https://www.attorneygeneral.jus.gov.on.ca/english/family/divorce/index.php 3. He is concerned about his debt, especially his high credit card debt. Between his line of credit and his two credit cards he has an additional $80,000.00 in debt and has been only making minimum payments. He occasionally finds himself paying bills with his credit card. He has been trying to put some money in an RRSP and has $10,000.00 saved and has not started saving any money for his children's education. He wants some information about bankruptcy and wondering if this is best to start a clean slate. He heard something in an advertisement about consumer proposals, and bankruptcies and is wondering if he will be able to keep his home and his car (he has paid off $10,000 of his $25,000 financing agreement for his car) and the advertisement said he could keep more than $30,000 of his assets and get rid of his credit card debt. After stating that you are not giving legal advice you advise that he should seek more information from a License Bankruptcy and Insolvency Practitioner if he wishes to further explore filing for individual bankruptcy or a consumer proposal and to stay away from anyone who says they can fix your credit for a fee (this is illegal in Ontario for more information see here https://www.ontario.ca/page/credit reports#section-7). Recommended resources: https://bankruptcy-ontario.org/ https://bankruptcy-ontario.org/avoiding-bankruptcy/ https://bankruptcy-ontario.org/avoiding-bankruptcy/debt-management-plans/ a. Explain the differences and discuss the general advantages or disadvantages of a consumer proposal vs. bankruptcy vs. debt settlement for this client and how they may affect his credit rating. What is your opinion as to his best course of action