Your business is thriving and the funds are rolling in. It’s a good predicament to have, and one that today’s guest helps us through.
Gerry Steckler is founder and president of Bridge to Prosperity, a holistic wealth management and business strategy firm in Burnaby, B.C.
On his LinkedIn page, he shares that money is an uncomfortable subject for most people.
“Don’t sit on the sidelines and fear asking a question,” he writes, explaining that not seeking professional advice can delay you in reaching your goals and cost you more in the end.
It’s easier than you might think to manage your current and future financial opportunities, says Gerry, and he guides us on how to do just that.
So, before you book that trip to Cabo, take note of Gerry’s tips for making your hard-earned money work for you.
Business owners tend to immerse themselves in their businesses, which is understandable as it’s that focus that brought them to where they are, says Gerry. But at some point, they need to take a step back and think about where they want to be in five, 10 or 15 years.
“Not next year, not in six months, but a much further horizon,” Gerry explains, adding that it does take time and effort to consider but it’s worth it. “They may not have any idea because they haven’t explored that.”
People have an innate fear of investing, according to Gerry, as they think they’re going to lose money. He shares an experience where he worked with a client who assumed she might lose 60 or 70% of her money if she chose to invest it.
“If I thought that would be the case,” he says, “I wouldn’t be investing money for anybody because I don’t think that’s realistic.”
He refers to the Morningstar Andex chart, which shows how different investments perform over time. It tends to ease clients’ anxiety over investing, though he notes that market corrections do happen. Still, when you purchase sound investments, predominately you will experience a moderate if not significant gain over time—and that nagging fear tends to lessen.
“Do you remember the first time you went out and drove after you got your licence?” Gerry asks. “You might have been terrified.”
Five years later, he says, you drive to the store and you don’t even remember getting there.
“All the fears and all the risks were still there,” he says, “you just got used to them.”
“Warren Buffett will tell you that all the time,” Gerry says, of the uber-rich American business magnate.
He mentions that none of his clients decided to sell when the COVID-19 pandemic hit, despite the market plunging. They may have lost a portion of their investments in the process had they sold, Gerry explains, though “everything has since rebounded,” he says.
Every day isn’t going to be a successful day for your investment portfolio, but that doesn’t mean your portfolio won’t be successful.
“We might not make 20% every year,” Gerry says, but our goal is to ensure that the client has a comfortable retirement based on their lifelong savings.
As a safeguard, it’s a good idea to start investing several years before you plan on leaving or selling your company, so there’s time for the market to correct itself and your portfolio to even out.
Gerry is a big believer in corporate life insurance, calling it a “good, safe way to invest money.”
Though starting with a term policy is budget friendly, opting for a permanent solution—even down the line—means you can borrow against your policy should you ever need to, say in your retirement.
There are also tax benefits to investing in life insurance, depending on the kind you buy, making this strategy a great way to shelter excess funds.
Gerry takes us through other options for investing, from independent pension plans to segregated funds, and offers reasons on why you might choose one over the other.
“It’s not a question of how much will this cost me,” he says, “it’s question of how much more can I invest?”
The sooner you start investing, the sooner you start earning on your investments—and they don’t have to be high-risk to make money.
Compound interest works over time to build your investment, and depending on the type of investment you choose, you could be left with a sizeable amount in the years after you’ve stepped away from your business.
“If you take advantage of that … At the end of the day, you will have this wonderful nest egg that you never thought possible,” Gerry says.