Jason Heath — Ontario, Canada

Jason Heath: Index Advisors For Canadian Expats

Jason Heath is in a tough business.  He provides objective financial planning but doesn’t receive a dime in commissions.  The Markham, Ontario based CFP and income tax specialist doesn’t earn annual fees based on his client account sizes either.  So how does the guy make money?

Jason charges consultation fees for broad financial planning: everything from estate planning, to budgeting, to retirement goals and investment allocation. Because he doesn’t benefit from investment purchases or client account sizes, he advises with no strings attached.  In fact, the strings are nowhere to be seen. His firm has an in-house accountant and estate lawyer.  And Jason isn’t too proud to use external resources when it makes sense to do so.

 “I was disillusioned by the mainstream financial industry,” he says, “so I wanted to do something different.” Few investment advisors could survive such a lean, transparent compensation structure.  But Heath builds a client base through heaps of credibility. He writes a column devoted to financial planning for the National Post, one of Canada’s two national papers.  Such a platform gives him plenty of exposure.

“I have clients in Canada, Brazil, Europe, the U.S. and Africa,” he says.  Jason’s services are perfect for Canadian expats building portfolios of low cost index funds.  “If they open accounts with an offshore discount brokerage [like TD Direct International, Saxo Capital Markets, DBS Vickers] or a non-resident account with TD Waterhouse, I can assist them with portfolio allocation after providing comprehensive short term and long term retirement, children’s education and asset allocation strategies.”

Heath spends plenty of time constructing financial planning goals with clients.  He charges anywhere from $1,500 to $4,500 for a plan.  “Some of my clients have relatively simple goals and asset distributions,” he says. “But other individuals might have assets all over the place:  a home in London, investment accounts in Asia, RRSPs in Canada, college funds in a RESP. “My job is to negotiate strategies to best utilize these resources with tax efficiency, while aligning with the clients’ goals.  And as they invest each month, they can call me up and I’ll ensure they stick to a logical investment allocation.”

Jason’s services are worth the money.  Consider someone with a $100,000 portfolio paying 2.5 percent in Canadian actively managed mutual fund fees.  They would pay $2,500 each year ($2,500 is 2.5% of $100,000). Those with $500,000 portfolios would pay $10,000 a year in hidden expenses.  Advisors stuffing client accounts with such products aren’t objective.  Canadian actively managed mutual funds are the world’s most expensive.  Those selling them benefit nicely. With Jason, however, investors could pay as little as $1,500 once, before getting on track with their plan and their ultra low cost portfolio of index funds. 

jason-heath

 

  • Company Name: Objective Financial Partners Inc.
  • Certified Financial Planner:  Jason Heath
  • Fee-Based Advice Consultations
  • Website:  http://www.objectivefinancialpartners.com
  • eMail: info@objectivefinancialpartners.com
Andrew Hallam

Andrew Hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School (Wiley 2011) and The Global Expatriate’s Guide To Investing: From Millionaire Teacher to Millionaire Expat (Wiley 2015). My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions. However, please read the Terms of Use.

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22 Responses

  1. Graham says:

    Hi Andrew,

    I just read through both books just over a day. I’ve already lined up to open a brokerage account with DBS Vickers in Hong Kong. The advice you’ve provided is exactly what I’ve been looking for the last few years. I finally feel that I can make it work with a young family living overseas.

    The one question I haven’t figured out is whether it’s in my interest to file Canadian income tax as a non resident in order to continue with my contributions, however small, to Canadian pension plans. Do you have an idea about that?

    • Hi Graham,

      I don’t know your full financial situation. But if you can invest much more money living abroad, you shouldn’t miss the small extra that the government pension will eventually deliver. CPP is not in the same league as a defined benefit pension. Please have a look at my expat book’s first chapter (or intro), again, to see what typical government payout is for Canadian retirees. Even if you ended up receiving $5000 less per year in CPP benefits, a $120,000 extra surplus in your investment portfolio (remember that 4% withdrawal rate) would be enough to compensate for that. Plus, as a non resident, depending on your jurisdiction, your money could grow, capital gains free, if you domiciled it in a non capital gains free zone.

      On a congratulatory note, I’ve never heard of anyone reading a book as thick as the expat book in a single day, never mind coupling that book with Millionaire Teacher as well. That’s an extraordinary skill I would love to have!

      Cheers,
      Andrew

  2. Lin says:

    Hi Andrew, Canadian expat here about to open an account at TD Waterhouse. I am planning on reading your book very soon. Can you explain what you mean by “domicile it in a non capital gains free zone.”

    • Hi Lin,

      If your brokerage is located in a capital gains free jurisdiction (Luxembourg, Singapore, Hong Kong etc) you won’t have to pay capital gains taxes on the profits you make. In a sense, it’s even better than a RRSP. Make sure you read the book carefully. It’s writing simply and clearly.

      Cheers,
      Andrew

  3. Fred says:

    I’m a bit confused! I thought the capital gains tax free status depended on where we are domiciled in terms of tax as opposed to just where the brokerage is located. For example, I am a French expat in Dubai and I am domiciled in Dubai in terms of tax (where is there is no capital gains tax). However my brokerage with SaxoBank is domiciled in Denmark. As far as I know I won’t be subject to capital gains tax, as long a I am domiciled in Dubai. (Although there is capital gains tax in Denmark where the brokerage is located). If I was to move to a country where capital gains tax is applicable, then I guess it becomes more complicated.

    • Yes Fred, it could become more complicated. If you move to Australia, for example, you might be evading tax laws by having an offshore account.

      As for the Saxo account, you would open it in a non-capital gains free jurisdiction, like Singapore or Hong Kong. If opened in a capital gains jurisdiction, such as Denmark, you may be entitled to pay Danish taxes.

      Keep in mind that a Danish brokerage, offshore, doesn’t have to abide by Danish tax laws. Much the same applies with TD Direct International. It’s a Canadian brokerage. But you can open an account with the offshore arm, which is in Luxembourg.

      • Wilco says:

        How does this work with tax on dividends? Is that dependent on where your broker is located, in which stock market you invest or in which index fund you invest?

        • Yes Wilco, it depends on all of the above. I don’t know your nationality. But I will give an example. Assume you are Canadian. Dividend taxes with countries that have a treaty with Singapore will be 15%, if your money is invested in a Singapore brokerage. If you live in a country without such a double taxation treaty with Canada, you may have to pay 25% on dividends.

          • Wilco says:

            Hi Andrew,

            Thanks for your reply.

            To give it a bit more context: I’m a Dutch national living in the UAE.

            Except the cost differences, do you see any benefits of TD int./ saxo/ DBS vickers Singapore?

            And then which stock exchange would you recommend?

            Thanks

      • Mark says:

        Hi Andrew, Can you please clarify the statement as I am in the same position as Fred. I am a Canadian living in Dubai. My Brokerage is also at Saxo Bank which is based in Denmark. I opened my account using the Dubai Branch however the account domicile is in Denmark. If I remain in the UAE, am I subject to Denmark Capital gains tax?

  4. Wilma says:

    We are Canadian expats living in the ME. We are trying to open an td Luxembourg investment account however, they insist my husband needs to rescind his American citizenship (he was born in the US but is not a citizen, both parents Canadian and e has always lived in Canada. Any advice?

    • Wilma,

      This is unfortunate. How about putting the money in your name? As a Canadian, with no ties to the U.S., you will be able to open an account with TD Direct International. And if you have no plans to live in the U.S. your husband may want to think very seriously about that citizenship. The IRS will want his money, no matter where he lives. Legally, he also has to file and pay U.S. taxes, no matter where in the world he lives. It makes little sense…but that’s U.S. law.

      Cheers,
      Andrew

  5. David says:

    Hi Andrew,

    Being the first of the month today, I have put some fresh money to the lowest performer of my 3 indexes…

    This particular index has had its worst run in 4 years, which for an investor is fantastic…

    My question Andrew that I have for you today is should I add extra fresh to poorly performing indexes (I can feel the greed taking over) or is it simply about keeping a balanced portfolio…

    Thanks Andrew!!!

    By the way mate, you are OUTSTANDING!!!

    • Thanks David,

      To answer your question, there’s nothing wrong with buying extra components of the falling index if it has been nicely crushed. Just don’t go beyond about 10% of the goal allocation.

      Cheers,
      Andrew

  6. S Marsden says:

    Hi Andrew,

    Just finished reading your book it was great, I was wondering tho do you see any harm in using two different styles of portfolios for example having 50% in a couch potato model and 50% in a Canadian-style fundamental model

    Thanks
    Scott

  7. S Marsden says:

    Thanks Andrew for you help with that also I was wondering what kind of portfolio have you made for your self using the horizon Canada ETFs and is the amount of tax you save on your dividends a substantial amount over the long term

    Thanks
    Scott

    • Hi Scott,

      My portfolio has a blend of traditional indexes and Horizon ETFs. Dividends, from Canadian sources, are taxed at 15%. So yes, the tax savings is substantial.

      Cheers,
      Andrew

  8. Wilma says:

    I am wondering what you think about using an hsbc global investment account (as an expat non resident Canadian)? Thanks for your thoughts.

  9. Jean Lamadeleine says:

    Hi mr Hallam, I am almost done reading The millionnaire teacher, title that got my attention since I have been in education in Ontario since 1998. I also like construction and renovations.I flipped a house this summer and made a nice profit. I am now looking at making more money out of what I made with the sale of this house. Investing in mutual funds was a possibility until I accidentally found your book. I am looking at various options on how to get started with index funds but I am not sure were to start. I compared what Scotia bank, TD, BMO and RBC have to offer but I dont understand everything. Although now, I can make sens of some of it thanks to your book. I have a nice pension setup with my carreer but I want to get more money for other projects I might want some day. I also want to teach my 3 kids how they can start investing early and pass on what I have learned in your book . Do you have another book to suggest or could you point me in the right direction so that I can learn what I must to get started? I seem to have lost a little confidence in the bank’s financial advisor I was consulting. Thank you for your time.

  10. Mike says:

    Hi Andrew,
    I’ve read both your books, the second one twice, and convinced my wife who has no interest in financial matters to read Millionaire Teacher.
    So now we’re ready to start moving our money out of mutual funds to low cost index funds.
    We’ve started setting up an account for her with Vanguard (she’s American) and at TD International for me (I’m Canadian). My question is this: Is there any advantage to splitting our money or should we just simplify things and invest both of our investment contributions via TD Int’l in a joint account?
    Thanks for your help.

  11. Hi Mike,

    Because your wife is American, you won’t be able to put her name on an account with TD Direct International. Such an account wouldn’t attract capital gains taxes. Legally, as an American, she must pay capital gains taxes on any account, in her name, that are not tax deferred. An IRA account would be tax deferred. But as an expat, unless she earns about $110,00 USD or more per year, she can’t contribute to an IRA. This puts her money in taxable accounts only.

    Cheers,
    Andrew

    If you have a moment, and you wouldn’t mind doing a quick review of my book on Amazon, that would be super. Thanks! http://bit.ly/globalexpat

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