We are pleased to share some research done for a client this week.
After the market meltdown in late 2008, many individuals sought safety in money market deposits. Our clients have deposited millions with us, into these accounts, as they work through our GET SAFE AND STAY SAFE process.
We offer our clients guarantees, with tax effective strategies to conserve capital on investment income, and at estate distribution.
One of our clients made a deposit of $1,250,000 into a money market account. Our research confirms that there are currently 355 funds offered in the money market sector. The general public thinks that a money market account is a money market account; that it is a low interest rate account, with safety of capital, the primary objective.
For the clients of Wernham Wealth Management, they know that there is a difference and we are going to share that difference with you, because it will make a difference of thousands of dollars in your future.
Deposits made into a money market account that are segregated funds come with unique guarantees. Because you can name a beneficiary in these accounts, the transfer of these funds through an estate could be probate free. That is a big advantage as we will illustrate for you, soon.
There are tax effective ways that you can receive the earnings of this program as well.
For most of the public, that is much a difference as there is. However, we are pleased to share with you the benefits of our most recent research.
After we determined how many money market funds are being offered on the market, we then analyzed the funds to determine the largest of these funds. The largest segregated fund in Canada's money market sector has $853,000,000 on deposit, at one of Canada's largest insurance companies. Our research has proven that bigger is not better. This fund has a management expense ratio of .41%. If you make a deposit into a money market fund in exchange for lower interest rates, you are hoping that there are low expenses. And if there is a management expense ratio fee you would hope that the managers are working to increase your return in exchange for their fee. More about that result when we reveal our research .
The largest money market fund in the country, is over $4,000,000,000 and is managed by one of the largest Canadian banks. Does that money market fund have an MER? It does as well! However, because this fund is not a segregated fund, the segregated fund estate advantages of no probate fee, no administration fee, and no executor expenses are not available.
Now, if I was going to make a deposit into a money market account say for $250,000, making that deposit into the largest fund in the largest bank should make sense. Wait till we share the results with you!
And if I was interested in the estate advantages and the tax efficient treatment of the earnings of a money market fund, it would make sense that I would make my deposit into the largest segregated money market fund with one of the largest life insurance companies in Canada. Wait till we share the results with you!
The money market funds that we offer to our clients have no MER's, that's right, 0%! NONE. They also have all the advantages of segregated fund protection, with no probate, admin. or executor fees at estate transfer, and with all the significant tax efficiency advantages that can be applied to the earnings on that fund.
So when we hear individuals say that they've had their deposits in money market funds, we know that we can help them immediately.
For an individual who made a deposit of $250,000 on January 08, 2009, to GET SAFE AND STAY SAFE, the results between the 3 companies are unsettling.
Had you made this deposit with the largest segregated money market fund in Canada (by assets on deposit) with one of the largest life insurance companies in Canada, you would have earned $688.84 as at September 22, 2010.
Had you not knowing about the benefits of segregated funds, and made your deposit into the largest money market fund in Canada (by assets on deposit), with one of the largest Canadian banks, you would have earned $3,327 as at September 22, 2010.
Had you called Ted Wernham, and asked him to research the opportunity for you, you would have made a deposit into a segregated money market fund with a life insurance company that he represents, with all the advantages of estate transfer and efficient taxation, into a fund with a 0% MER.
And you would have earned $13,008.91 as at September 22, 2010.
Same deposit, same term, big difference from Ted Wernham.
In my client's case, a $1,250,000 deposit into the segregated fund money market account we recommended, would have earned for him $65,044.
Had he walked into the nearest bank branch of one of the largest Canadian banks to make a deposit into the largest money market fund in Canada, he would've earned $3,,327.00. And guess what the probate fee on that amount would have been on estate transfer. It would be $3,799.90, more than the earnings over the period.
There are money market accounts, and there are money market accounts that Ted Wernham recommends.
We are pleased to confirm that as of today, our money market account is paying 1.4%.