Page 26 - Newcom

holistic planning
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The situation
Natalia Meyer* didn’t go back to teaching high school. Before her maternity leave ended, she started a master’s in education part-time; by the time her second child was born, she was enrolled in a PhD program. Lionel is now 13 and Barbara is 11. Since completing her studies, Natalia has been a senior administrator at a local college, earn- ing $120,000 per year. She bikes to work from the duplex she bought for $1 million with her common-law partner, Wilson Eto, before Lionel was born.
Wilson’s company, which sells men’s grooming products directly to consum-
ers online, was recently acquired by a multinational consumer packaged goods company. His $200,000 annual salary as the brand’s managing director with the multinational was almost double what he made as vice-president with the boutique. However, after a year in the role, Wilson has been deemed redundant. He receives a $250,000 severance package.
Through her college, Natalia has the opportunity for a one-year secondment at a
university in Mendoza, Argentina. Her late father was born and raised there before moving to Toronto as an adult. Natalia sees it as an opportunity to connect with her roots, and for an adventure before the kids start high school. While Wilson is nervous about being out of the job market for a year, he reluctantly admits it’s a chance to consider his next steps from a distance.
After talking it over with the kids, Wilson and Natalia decide to do it.
This
article is the second in a four- part series following Natalia and Wilson through continuous life stages
Financial planning for a year abroad
Lining up a job is the easy part. The experts help with budgeting, tax planning and maintaining resident status.
by Suzanne Yar Khan rent out their own house in Toronto.
Between mortgage payments of $2,500 per month and Natalia’s years at school, they haven’t added to their savings since they bought the house. They still have an unpaid mortgage amount of $400,000**.
How can the family prepare for a year abroad?
*These are hypothetical clients. Any resemblance to real persons is coincidental.
**Based on a five-year fixed mortgage at 2.89%; 30-year amortization
Natalia’s salary in Mendoza won’t change, and will go farther given the cost of living, which is about $2,600
per month for the family. Still, they’re worried about living on one income, especially since they want to use the opportunity to travel. The family will need to find a rental; they plan to
David Harris
Investment advisor, Cumberland Private Wealth, Toronto
Marvin Khoshkhassal Tax partner, MK & Associates Tax Services Ltd., Vancouver
James McCreath
Portfolio manager, BMO Private Wealth, Calgary
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JUNE 2020
Answers have been edited for length and clarity